Nonprofit Finance Fund dedicates a great deal of time to advocating for well capitalized
organizations, many nonprofits in the arts and culture sector are still wrestling
with how to create and sustain revenue streams to support operations. When we talk about “well capitalized,” we mean
a fully funded operating platform (staff, infrastructure, and assets necessary
to run successful programs) and the appropriate amount of reserves to create a
healthy balance sheet (sometimes referred to as capital structure). These reserves can serve as working capital
to cover cash flow, support repair and maintenance costs for facilities, or
provide resources to test new programs without undercutting current services.
Where do these reserves come from? While capital campaigns and investments of philanthropic equity are common sources, many organizations must fund reserves incrementally, over time, by generating operating surpluses. With the economic downturn still challenging the nonprofit sector and limited staff resources a continual challenge, what can nonprofit leaders do to access and generate new sources of revenue?
This year, two arts service organizations, the Arts & Science Council (ASC) of Charlotte, North Carolina, and the Greater Pittsburgh Arts Council (GPAC) are launching initiatives to support arts and culture leaders’ efforts to bring in new dollars to support their organizations. In Charlotte, the program is titled power2give and is described as an online cultural marketplace designed to connect donors with projects they are passionate about. The site allows cultural organizations to promote projects in need of funding, and invites donors to contribute directly to the projects that most intrigue them. This platform, devoted to supporting arts, science, and history initiatives, allows cultural patrons to help the organizations they love meet their needs. With tools and resources for both donors and nonprofits, power2give.org, which goes live in July, aspires to make posting, donating, and promoting projects convenient and engaging.
In Pittsburgh, they are launching the “Pittsburgh is Art Day of Giving” on May 11th; a 24-hour donor match campaign that covers 10 counties and allows arts organizations to pre-register to receive matching funds for online contributions. Sponsored by the Greater Pittsburgh Arts Council and supported by the Heinz Endowments, the Pittsburgh Foundation, the Hillman Foundation, and other funders, the goals include:
- Increasing individual giving to arts and culture nonprofits.
- Drawing attention to Pittsburgh's diverse and vibrant arts and culture community.
- Attracting new donors and new dollars.
With an anticipated match pool of $500,000 (the fund is still under development) the Pittsburgh is Art Day of Giving will ensure that every organization that receives contributions during the 24-hour match period will receive a (pro-rated) portion of the match.
Nonprofit Finance Fund’s 2011 survey, released in late March, tells us that 87% of nonprofits feel that the recession has not yet ended. Bank of America Charitable Foundation President, Kerry Sullivan states, “In this economic environment, it’s imperative to do what you can to help nonprofits keep the lights on while they are supporting such an increased demand for the most essential, basic services.” Our colleagues in Charlotte and Pittsburgh are using new technology, community wide efforts, and innovative approaches to increase the pool of available donor dollars. In short, they are generating access to revenue; this in turn may translate into improved operating performance and increase the likelihood of a healthy balance sheet.
|Arts, donors, Pennsylvania, Pittsburgh, revenue|