I’ve called this post: “What got you here won’t get you there” because when it comes to scaling your organization in a sustainable way nothing could be more true
Which of these sounds like you:
You’ve been growing your organization but you’ve plateaued…
You feel like what you’ve been doing was working but somehow you’re not growing anymore… or it’s getting harder. Maybe the people who were the right ones for the team are not such a great fit anymore…
You’re running at greater capacity than you can sustain and you and your team are slowly burning out…
Your programs are growing – and great – but you have the staff you’ve always had, and you’re all maxed beyond capacity…
Funding is coming in but it’s lumpy and feels uncertain…
Your income comes in inconsistently, and you feel like you’re starting from scratch every few months. You’re constantly worried about how to secure the next couple of checks. Maybe you’re super reliant on one or two key foundations or donors, and that’s scary too…
You’re overwhelmed and everything seems urgent…
You sometimes feel like you can’t catch up – your organization is running you instead of you running it.
No matter which of these fit your situation, you’re in what I call a “gear shift” moment — between where you were and that next impact horizon for your organization.
It’s like when you’re riding a bike and you shift gears. For a moment everything feels just a little chaotic before the new gear catches.
Nonprofit growth is just like that.
In each stage of growth, organizations hit a point where they can’t grow any further using their existing set of skills and knowledge, and systems. They have to shift gears if they want to keep growing.
This is what I call The Gear Shift Moment. And it happens time and time again, at every stage of growth.
Here’s the key: A $1.5M organization is not simply a $600K organization with more money.
As organizations grow they become different organisms. Each phase of growth requires a different type of design, different ways of spending your time, different approaches to money, and even different leadership mindsets. If you’re going to grow your organization, you must be willing and ready to do things differently than you have done them.
“I actively looked for and invited a new way of leading. I asked so many questions and was willing to unlearn what no longer served me. My org is a different org & I’m a stronger leader!” — LeAnne (Accelerator Student)
So I’d like to invite you to do a little thought experiment. Close your eyes and picture what your own organization looks like one year from now if it’s having the impact you want it to have.
- Picture your bank statement – what does it say?
- What does your staff look like, to support the type of work you’re doing?
- What IS the work you’re doing? How many people or communities?
- What role is your board playing?
- Who else is in your network and how are they supporting this impact?
- How do you FEEL as a leader?
That vision you saw when you closed your eyes is your why. That is what motivates you to keep pushing through the messiness of your gear shift moment. It is why making the gear shifts that I’m sharing here is so absolutely critical.
Shift One: Understand where you are in your nonprofit’s lifecycle
The nonprofit lifecycle is the process by which organizations grow and decline through specific changes in systems, processes and elements.
This is one of the most critical shifts because it frames literally everything about your growth. Knowing your current and next stage is critical: If you want to grow your organization the right way, without wasting time and money, and without overwhelm, you have to do the right thing at the right time.
There are 10 stages and each phase has specific characteristics and benchmarks.
Knowing the hallmarks of your stage will help you determine where you are, and where to go next.
Idea/ Birth/ Launch:
During this phase, you’ve identified a problem and are developing a solution or vision. Most funding and staffing is personal, and friends and family. Many groups do not move beyond the idea stage into the formal “start-up” stage.
This phase is marked by high energy, limited funding, and a newly acquired legal status. This may be 501c3 status, this could be a B-corps or some other social enterprise format. Many organizations are playing with different corporate structures. The key is that you’ve formalized the institution and are racing to do the work of the organization and survive.
Child/ Post-Start Up
This is where the organization begins to walk and talk on its own – that is, separately from the founder. There is more stability at this stage, but you are still figuring out how to actually be an institution. Who and how to hire; Who should be on your board and what a board should do; How to systematize your program model… How to separate the institution from the founder.
Teen/ Early Growth Stage
Generally, as the organization hits its stride, becoming a growth-stage operation, it focuses on standardizing and deepening programs to meet the needs of its constituents, turning its board into a true governance board, and formalizing its structure and processes to ensure organizational vitality. Growth almost always outpaces capacity, systems, and money. This stage is often marked by a focus on calibrating expansion with funding, right-sizing workflows, and communication.
Young Adult/ Late Growth Stage
Growth stage organizations are often lumped together. But really there are two phases here. A late growth stage organization is growing steadily and wants to ensure that it remains stable and anchored in its values and mission. Here, the leader is learning to get out of the weeds and to work ON the organization not just in the organization. Most systems are set up, but now it’s about refining and learning to use them.
Prime Adult/ Zone of Maximization
Here, the organization is stable, mission-aligned, rooted in systems, and having a great impact. They’re building a reputation and have a POV that people understand as unique and impactful. This can be a happy place: Things work, systems are in place, and people know their jobs
Moving through these stages requires hitting very clear and recognized benchmarks.
As you move through each stage of your organization’s growth, you need to know these benchmarks so that you know how best to grow. Specifically: where is the next best place to aim your money, time, and attention to help you grow.
==> (I go into much more depth into each of these in my 4-part video training all about growth)
Here’s the mistake most organizations make.
They don’t pay attention to which stage of growth they’re at so they wind up aiming at the wrong goal. They don’t ask the right questions about how to staff up or how to reach new donors; They misdiagnose problems with their board; They try to institute practices that their organization is not set up to support, and running the organization begins to feel hard and heavy.
Knowing your stage tells you the key milestones to shoot for and challenges to look out for. You want to make sure that you recognize the stage you’re in so that you can set the right goals and address the right challenges. You want to make sure your goals, plans, and actions are aligned with where you are – that will help you be most effective and smooth in your growth.
Here’s an example: If you’re an infant organization with a 5-person board and you try to set up formal board committees and officers, you’re spending time and energy on the wrong goals. You’ll burn out your board and wind up annoyed at them.
Another example: If you’ve got 2 major donors each giving $10K and you set a goal of a sustainable budget of $1M in the next year, you’ll burn your staff out running fundraising campaigns that will never get you to $1M.
The key here is you must know your stage of growth so you can accurately locate yourself, and know the RIGHT benchmarks to be aiming for so that you can make the strategic shifts you need to make.
“I feel like I’ve taken the deepest breaths I’ve been able to take in the last 6 weeks. I know what to do next.” – Carol (Accelerator Student)
Shift Two: Know the true cost of your vision for growth
You cannot grow your organization if you don’t think seriously and intentionally about your organization’s money.
I know that thinking about your finances can be scary and overwhelming. But I’m going to make the case that your finances are simply another part of the story that you tell about your programming.
Your budget and financials are storytelling tools that use numbers to help people understand your vision for growth.
This is where the shift to True-Cost Budgeting becomes critical. You must have a true cost budget.
A true cost growth budget is a budget that reflects the true cost of your plans for growth
The big mistake that people make here is that a lot of nonprofit folks start with, “What did I raise last year?”
They add a little “stretch” onto that number, and consequently, they don’t have budgets that actually reflect a sustainable organization.
This really matters. Every week, I talk to Nonprofit CEOs running organizations that ARE ROCKING IT from a programmatic perspective. But, they STILL struggle with payroll at some point each year. And they don’t have enough funding to feel comfortable expanding like they want to.
This might be the number one thing I see that’s keeping people from really growing their budget and impact.
If year after year you’re creating a budget based ONLY on committed revenue or on last year’s numbers, sadly, that’s likely the amount you’ll raise again. When your budget is driven by what you’ve raised or secured, two things happen: You can’t craft a fundraising plan that will bring in what you actually need, and even more importantly, you can’t communicate your true need to your donors and funders.
A true-cost budget requires you to really ask yourself – and be honest about the answer: What is that number that you need to be raising that would fund our vision and propel our organization forward?
Whatever your concrete vision for growth and increased impact is – the number and location and scope of programs, equitable pay for my team, the expanded staffing, the partnerships, the IT needs, the marketing and communications… There are costs associated with each element of that increased impact. A true cost budget reflects the true cost of your growth vision.
This is by far one of the most transformative processes that I undergo with my students in the Next Level Nonprofit – bravely building out a true cost budget, and securing board buy-in for a new way of thinking about budgeting and next-level fundraising.
“Once we knew what we needed in order to really grow, my team and I knew what to shoot for… My confidence came from my clarity: The increasing money felt like magic money.” – Toya
==> I do a deeper dive into this whole concept of growth budgeting – an entire mini-training – in my Focus on Growth training bundle!
Shift Three: Treat your time like an asset
How many times have you thought to yourself:
“I never have time to think about the big picture because I’m always putting out fires!”
“I’m not making the new connections I need to be making and building the relationships I need to be building because I’m always in meetings or doing office work!”
“I don’t have the team I need to delegate to because I’m always in the weeds of my organization…”
Enter the old adage: Growing an institution requires you to make time to work on your organization not just in it.
The big mistake that people make here is that they don’t spend their time on high-leverage activities.
That is, those activities that drive revenue and impact – you want more of your calendar to include these.
Think about it this way – you’re on a path out in a forest – your role, increasingly as your grow, is to be above the trees looking way down the path and strategizing about how to get down the path quickly and efficiently. High leverage activities are the things that are like a jet boost down the path.
There are certain high-leverage activities that you should be trying to maximize in your calendar.
- Network expansion & Strategic partnerships
- Strategic visioning and thinking and planning – big picture, deep thinking about the direction of your org
- Thought leadership – establishing your organization’s footprint and POV in the space that you inhabit
Each of these types of activities, when done correctly, has a high return on investment. That is, for every hour that you spend, the effect on revenue and impact is significant.
But here’s the secret that no one tells you: Making time to work on your organization is not just about “being better with your time.”
The key is to start treating your time like an asset – the way you’d think about money. When you think about your time like an asset, you begin to treat it like the other assets in your organization. You realize that you only have one of three options for using your time: save it, spend it, or leverage it. You are always doing one of those thing, and the more strategic you are about what you’re doing with your time, the farther it will go.
==> (One of the most powerful ways to focus on high leverage activities is to have already done models and templates – rubrics that you can plug into and execute. One of the things I’m fixated on is giving my students and clients a template or model for almost everything, from hiring plans, interview rubrics, board agendas, etc. You can get some of them yourself, and check out the templates I’ve brought together in the Nonprofit Leadership Resource Hub!)
So let’s recap:
You learned the 3 shifts that will drive your sustainable growth: Knowing your growth stage, Crafting a true cost budget, and Treating your time like an asset.
You understand why each of these shifts is so important:
- Knowing where you are in your growth allows you to be super strategic, and to ask the right questions, and make the choices at the right time – it is the foundation of your strategic clarity
- How your growth budget – while it seems like only one thing – is actually the blueprint for your growth. It frames your hiring, programming, and resource allocation, and it opens the door for a new kind of fundraising conversation that is necessary for taking you to the next level
- How to spend your time more strategically – the more you think about it like an asset, the more you’ll be able to be surgical about how you spend it and where you aim it.
Ulimately, you’re reading this blog because you’re ready to grow, and if there’s one thing I learned over the past 20 years, it’s that you can’t “reverse engineer” true growth from the outside.
It doesn’t work to just look at larger organizations and try to copy what they’re doing, or google traditional resources, all of which study more established organizations with bigger budgets.
When you’re just looking on, you can’t see the strategy and nuance and ups and downs that’s happening below the surface by looking at what you see publicly.
You don’t see the meetings, coaches, difficult conversations with staff members who aren’t the right fit, changes in how the ED uses time, shifts on the board, etc.
You can’t know the investments that organization has made in growth, and what tradeoffs they’ve made as they’ve grown.
When you’re running an organization, there is SO much cobbling things together — So much trying to see into the black box of growth by looking at how other organizations are doing it, when the truth is every organization is a unique constellation of programs, staff, board, programs, and fundraising style.
The problem is that trying to cobble it together is exhausting and time-consuming: As an ED you already have to figure so much out on your own.
It’s also not going to work: You’re not going to find $1M in magic money and suddenly have a sustainable 7-figure organization. Not without answering and navigating the questions I’ve highlighted in this post. Some organizations answer them and grow quickly – for some it takes more time.
My point is this: There is a method to the madness and seeming chaos of growth.
There is an uncluttered, not overwhelming process for growth that you can apply to your organization.
When you first started reading, I invited you to close your eyes and picture what high impact looked like. Now imagine you had the exact roadmap to get there. Imagine you had a coach as a thought partner – to help you cut through the noise and the tyranny of the urgent and know your next best step. To say: Do this first, this second, and you can safely ignore the other 2 things. Imagine you had personalized consulting help on developing the right strategic plan, growth budget, and finance plan – the trifecta bundle that you need to grow.
If this sounds appealing and exciting, definitely shoot me an email (firstname.lastname@example.org) to chat about applying to work with me through the Next Level Nonprofit!
We can go DEEP on all of this and navigate your critical gear shifts, together.