Building High Impact Organizations: Creating Financial Sustainability for Social Enterprises and Nonprofits

by Hannah Jang, Chief Blogger 

Are you finally ready to tackle the question of financial sustainability for your nonprofit or social enterprise? If you’ve been putting it off, here’s your golden opportunity to work on one of the key elements in building a successful enterprise with a group of game-changing professionals in the social good space. Join the “Green Breakfast Club” and "Social Innovators Collective" for their 5-part workshop series. We speak with Danielle Lanyard, Founder of Third Rail Ventures and the Green Breakfast Club, to hear about the successful kick-off meeting as she lays the groundwork for the entire series.

Why is it important to address financial sustainability?

Addressing financial sustainability is important for a few good reasons. The first is that most startups of any kind fail, whether they are nonprofits or for profit ventures. The second is that mission driven organizations often focus on the social and ecological bottom line while ignoring the financial bottom line. The last reason is that one needs to be financially sustainable in order to carry out one’s mission.

What are the factors influencing the financial sustainability of social entrepreneurs and nonprofit founders?

I think the factors are many, the approaches varied, but the key components identical for achieving financial sustainability. These include a clear knowledge and usage of available support resources, a strong brand and awareness in how to actively tell the story of this brand, and then an understanding of the best options to support and execute your business model. These can be anything from what corporate structure to use, what design thinking can do for your brand and prototyping, and how to craft the art of the pitch and the funding strategy to generate revenue or raise capital or donations for your venture.

How do you avoid the challenges you may encounter?

I read as much as I can about other people’s mistakes, lessons learned and domain expertise, whether it is Fred Wilson’s AVC.com blog to the tweets coming out of FailFaire and industry conferences that offer knowledge transfer. I’m a klutz, both in life and in business, so I assume I’m going to trip up a bit. So, I read the success stories of others, and pay attention at events and conferences when keynote speakers tell you their stories, for these are the real gems that help you not make the same mistakes.

Which specific resources do you recommend?

I recommend spending as little as you can to make as much as you can, as leanly as you can while you are developing your idea into a clearly developed, financially sustainable, mission driven organization. I recommend taking free entrepreneurial training classes like Fast Trac, or applying to business incubators that provide mentorship and support services for founders. I’d also shamelessly promote the set of resources I outlined in the first part of our workshop series:

            bit.ly/GBCSICGAWorkshop

What kinds of impact do you seek to have with this workshop series?

I’d like to see more ventures succeed, more founders launch well thought out mission driven organizations, and more people applying these principles within their existing organizations. I’d like to see attendees helping each other and supporting each other's initiatives, and I’d to like to hear from these attendees on what gaps they think need filling in this innovation ecosystem. Lastly, I’d like to start thinking of better ways we can measure the impact of mission driven organizations themselves, and how this can improve their financial sustainability.

 

Danielle Lanyard's life and work experience blends environmental study, community action, and business development. Her work began as a child and spans two decades and four continents, including early coursework in Environmental Studies at The Evergreen State College and a B.A. in Psychology from UC, Santa Cruz. Rather than enter the workplace, Danielle chose to travel, living out a lifelong dream to see the rest of the world, where she bartered her way around the globe and got the first inklings for the idea of a barter as a business. Back in the US, she became a serial social entrepreneur, launching startups, Travelcology and Open Venture Society, small businesses still in business today.  She is the founder of Third Rail Ventures, an organization to support and seed startups for social and ecological change, including these events and a documentary film project on electronic waste, E-Wasted. When not running around town getting these ventures going, you can find her tweeting away at @ecoblips.

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