Size Does Matter: For Charities, Staying Small Works

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“Evolution has always benefitted smaller creatures over larger ones.”

One of the biggest mistakes I made as a first-time executive director (ED) was getting too cocky. I knew I was a strong fundraiser and I was on a very good streak in my first 5 months on the job. I took over after a multi-month gap with no executive director and the organization was losing money. It was also in debt and then the national economy collapsed around me. This was August of 2008.

 

I quickly engaged my network and found the money to pay off the debt, stop the hemorrhaging, and ensure that we were stabilized. But I was too ambitious. I knew that people were worried about foundation and individual giving falling off a cliff in 2009 but I believed we were stronger than that. I needed staff support so I added a development person, thinking he would be able to grow the organization. It didn’t work.

A paralyzing fear came over me one day when the financial statements showed (incorrectly) that we only had a few weeks of money left in the bank (I later realized, it wasn’t so dire). I was terrified I was going to have to fire one or two people. I was stunned and angry at myself. How could I have been so foolish and not been more cautious? I worried that I had failed at my first Executive Director job and everyone would know it.

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Luckily, just as I realized we had 3 months of reserves, not three weeks, two employees were made offers elsewhere and left. This eased the cashflow problem and gave me a moment to pause and assess my own leadership. What lessons could I learn from this?

One of the biggest lessons I took away, was immediately useful in my next ED position. Size isn’t everything. In fact, a peer told me, “Stay small. Evolution has always benefitted smaller creatures over larger ones. By staying small you can pivot, adapt, and not be held hostage to an expensive central staffing structure.” It doesn’t mean you shouldn’t raise more money, but it did mean there was a different way to grow your team. Like a tortoise, instead of a hare, I have adapted this lesson in every small organization I have led.

It seems like most nonprofits and businesses want to grow or “scale.” That is a totally understandable impulse but it is NOT the only model and not the only way. If you want to reduce stress and still focus on reaching your mission, consider being a smaller player with a vital niche to fill until the resources are available to grow. Don’t feel like your small size is a failure of your fundraising or prowess. Making a decision to be small can be just as strategic as deciding to grow.

Funders should take this perspective into account because too often they are the ones pressuring organizations to scale before they are ready. Nonprofit leaders should also give themselves a reprieve from always feeling like they have to be Sierra Club, or United Way, or the American Heart Association. You don’t have to be them and maybe you shouldn’t. That’s OK.

I would love to hear your stories of stress and success around issues of scale and size. Message me at Sean@MindTheGapConsulting.org

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