Nonprofits and the Business World

I once heard someone say that business executives on nonprofit boards too often leave their brains at the door. It’s unfortunate that some businesspeople who get involved with nonprofits can be impatient (in the same way they are with politics) and immediately bark out a list of ways nonprofits need to be “run more like a business.”

I have too much respect for the complexity of what these organizations are trying to accomplish to think in those simple terms. What’s more, I also know plenty of executives who have amassed large fortunes and then wasted small fortunes trying to “reinvent” philanthropy or start their own nonprofits from scratch.

Convinced that they have fresh approaches to old problems, they don’t do basic research and due diligence, including having frank conversations with people working in the area and reviewing case studies of why previous approaches haven’t succeeded.

Both sides can learn from each other. I had years working in venture capital and I’ve found that many of the management tips I used with startups can be used to help nonprofits. If you take the issues that most startup companies face and list them next to the management challenges many nonprofits struggle with, you would not be able to identify which is which.

  • Does your board include individuals primarily from the business world?
  • How can you gain the greatest advantage from their knowledge and experience?
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