Social Startup Success - Vignesh Prasad

## Highlights - Social startups face a vexing catch-22: funders want to see proof of an organization’s success before offering grants, but nonprofits need funding to get their ideas off the ground. The lack of seed funding is one of the biggest differences between growing a nonprofit organization and a for-profit business. - IDEO, for example, has developed a rigorous step-by-step method for nonprofits through its nonprofit spinoff [IDEO.org](http://ideo.org/). It offers a Field Guide to Human Centered Design for free download. - A strong connection with the needs of your targeted users, and an open-minded commitment to listening to their input and responding to it, will gain you the support and engagement of those you seek to serve, the insights to improve your results and, in turn, the funds you need to take your organization to the next level. - Failing to fully understand these political and economic factors was a major flaw in the early planning for the project. As Fruchterman wrote: “Historically Benetech simply waved the intelligent good-guy flag and people helped us.” This time that approach fell short. - Another reason leaders are reluctant to shut down failed efforts is that we all tend to become intensely committed to our ideas, and it can be difficult to evaluate them dispassionately; we want to dig in and keep trying to make them work. - Discontinuing a program that’s been bringing aid to people in need can feel like a betrayal of one’s principles and of one’s commitment to those people—and it can exact a heavy emotional toll. But the deeper truth is that an organization will serve people best by recognizing when efforts aren’t working well and making the difficult changes that will produce better results. - In order to assess true impact, organizations must develop measures to track outcomes. - In short, a theory of change is a tool showing the causal links between an organization’s vision and its programmatic activities, detailing the intermediate outcomes and assumptions that must occur to achieve success. - Gitin slowly learned that with funders looking for strong metrics of success, targeting the most challenging cases was a recipe for lots of funding rejections. The number of clients the organization served was much lower than that of organizations tackling the low-hanging fruit cases. Gitin attributes this to what he calls the “creaming effect,” whereby nonprofits are incentivized to target easy-to-reach populations in order to boost their metrics. The other funding challenge At The Crossroads faced was that the founders didn’t want to impose their own goals on their youth, such as that clients would find employment and a place to live. But that philosophy cut against the grain of funders’ expectations. - “That experience laid bare the assumption that good intentions and real results go hand in hand: oftentimes, they don’t.” What made that moment even more difficult was knowing that students were reporting positive gains from participating—just not in the way he’d set out to measure the gains. - Despite the hype, earned income accounts for only a small share of funding in most nonprofit domains, and few of the ventures actually make money.”1 Social entrepreneurs are, by definition, working to solve problems resulting from market and government deficiencies. A purely market-based approach cannot always work. If bringing clean water to the 800 million people who don’t have access to it, or selling mosquito nets to the 200 million suffering annually from the scourge of malaria, were profitable ventures, private companies would be doing it. - He and his coauthors argue that charging appropriately calibrated fees to beneficiaries can be empowering to them, affording them the dignity of paying. They also highlight that it can be productive in helping to screen out those not getting much value out of the program, allowing you to focus better on those who are finding it more helpful. - “recasting fundraising as a dynamic relationship between organizations and their philanthropic partners that is designed from the start to be cocreative and generative.” She encourages nonprofit leaders to start thinking of foundations as part of their philanthropic team of “partners” as opposed to donors—a way to shift the power dynamic, putting the work at the center of the relationship as opposed to the money. - asking guests to walk down a fashion show–like catwalk, referred to as the “waterwalk,” with two yellow five-gallon jerry cans of water to simulate what it’s like for those who have to walk miles a day with these jugs to provide water for their families. More recently, they made five hundred virtual reality headsets available at their event so that all five hundred guests could experience “being” in Ethiopia together at the same time. - (1) continuing to play too dominant a role in the messaging about the organization and in running it; (2) failing to hire people with the right expertise at the right time; and (3) appointing the wrong people to the board. - “wise CEOs recognize that they must share power if they are to unleash and magnify the potential of their organizations. They learn to let go to have greater impact.” - “There are two ways of being creative. One can sing and dance. Or one can create an environment in which singers and dancers can flourish.” - When people are in charge of their own metrics, all of a sudden “the purpose of data isn’t some kind of pure accountability mechanism to distinguish between people who fail and people who succeed. It’s about how can we all succeed together.” - a great leader “stays behind the flock, letting the most nimble go out ahead, whereupon the others follow, not realizing that all along they are being directed from behind.” - “When you’re a social entrepreneur, the idea of prioritizing yourself feels so counterintuitive because the issues we’re trying to solve are so pressing, and we don’t want people to have to suffer. - Too many founders get so swamped by attending to the day-to-day operations that they don’t have time to think about the big picture. - CEOs who took their companies to a higher “great” level of performance “first got the right people on the bus, the wrong people off the bus, and the right people in the right seats.” - Opening up about ourselves, being vulnerable and telling our story, and importantly, why we became devoted to the cause, creates a personal connection with our audience. - Who will be in the audience? • What do they know or believe that I can build on? • What do they know or believe that I have to overcome? • By the end of my presentation, what do I want them to have learned? • By the end of my presentation, what do I want them to feel?