People, foundations, and corporations give nonprofits money in return for something – to help fund a new cancer wing of a hospital, the start-up of a new community center for teenage mothers to continue their education, to support programs to clothe and feed the homeless. Impact is what donors and funders are paying the nonprofit to provide. It consists of the changes in the service user and/or society as a whole that are achieved by the nonprofit. In the for-profit world, this would be called a value proposition. For nonprofits, it must be the public benefit they achieve that justifies the donations and funding they receive and the tax exemption they enjoy. Owing to the widespread lack of agreed-upon metrics in the nonprofit sector (among many other factors), the inability to prove impact is often where nonprofits’ business models are the weakest. When this condition is true, the business model is always susceptible.
Posted on: Mon, 09 Sep 2013 11:00:00 +0000
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