Springboard for the Arts, the nonprofit where I work, just gave away its oldest program and most reliable earned income stream. We took the curriculum from our artist-entrepreneur training course, packaged it into a free toolkit, and we’re giving it to anyone who wants to start and customize their own program.
We did it to increase our impact. A community and economic development organization run by and for artists, our mission is to help artists make a living and a life, and to help communities connect to the creative power of artists. Our programs include Community Supported Art (CSA); Artists Access to Healthcare; Irrigate artist-led placemaking; and Work of Art, the artist-entrepreneur training course mentioned above. Conventional nonprofit wisdom says we should monetize our programs by getting other people to pay us to implement the program in their community. The reality, though, is that this strategy usually fails to generate heaps of income for a nonprofit; additionally, it creates no permanent infrastructure or local ownership, limiting the impact for both the nonprofit and the community.
So after countless conversations about scale, competitive advantage, franchising, and growth, we concluded that rather than seeking to create an empire, we should be in the business of creating change. In that spirit, we are embracing abundance and rejecting the prevailing scarcity culture of the nonprofit sector. Essentially, we are trying to make sure that what we offer is available to as many people as possible, and we are not going to be intimidated by the idea (so prevalent in nonprofit culture) that behaving like a for-profit corporation is the path to success.
I believe in our new approach. In fact, I believe that all nonprofits can build new systems of investment and support and new economies based on local knowledge and exchange by sharing proven tools and mechanisms for addressing community challenges. In other words, by creating a sharing economy that actually shares.
What the “sharing economy” can and should be
The “sharing economy” (also known as “collaborative consumption”) is commonly defined as an economic model in which people “share” access to goods and services with one another, often through an online platform that facilitates the peer-to-peer transactions. Described this way, it implies a sense of equity, community, and connection that our economy sorely needs. But a lot of what has been called “sharing” really isn’t. A quick look at the facts behind many of the highest profile sharing-economy businesses reveals the same (and sometimes worse) inequities and disparities usually associated with other corporate interests. Increasingly, the “sharing economy” is also linked with anti-labor practices, opposition to progressive taxation, and other not-so-noble outcomes.
Meanwhile, nonprofits have been strangely absent from the conversation about the sharing economy—even though the term ought to describe most nonprofits’ aspirations. After all, isn’t nonprofit work, at its roots, about increased economic equity and engaged community participation?
Nonprofits have an opportunity now to repurpose the phrase "sharing economy" to mean what it should: shared resources and shared ownership. We should take that opportunity; in fact we should lead the way to a real “sharing economy.”
To that end, we need to think differently about some commonly held best practices. Here are three ways to start:
Share programs and tools. In part because of the influence of business leaders on nonprofit boards of directors, the nonprofit sector has adopted wholesale many for-profit practices and has largely accepted as fact the need to be competitive, to protect ideas and uniqueness, and to generate revenue. Nonprofits win points with funders by showing earned income because it means their work is more “sustainable.” Fundamentally, though, solid fiscal management is critical to nonprofit success, but it is a means, not an end. A nonprofit’s mission is to make change, not to make money.
In that spirit, we can and should share what we know more freely. By sharing the roadmap for proven solutions, these successes can be replicated and multiplied. Learning from those who replicate the programs also creates reciprocal value—allowing us to see our work in a larger context and gather useful feedback, modifications, and ideas from a wider field. We can make the case to funders and partners that the benefits of this larger impact contribute much more to the sustainability of solutions than an overly monetized approach. The success of models like Community Supported Agriculture demonstrate the potential for ideas to spread quickly if information and resources for replicating them are widely available and not guarded by a single organization.
Share governance. One of the most important critiques of the for-profit sharing economy is that the businesses at the forefront of the trend are most often not owned by the people who are running them. They are built on a model that relies on sharing or exchange, but the businesses themselves don’t share their profits.
Shared ownership should be an easy idea for nonprofits to model. In a nonprofit organization, the profits support programs that serve a specific mission. No one can own a nonprofit; it belongs to the public trust. I believe a nonprofit’s board should be the tool that puts ownership of an organization and its mission and vision in the hands of the community. To do so, the sector needs to challenge accepted wisdom that the primary qualification of nonprofit board members is that they are high-wealth individuals. That approach too often leaves out any representation of an organization’s clients, customers, or stakeholders at the highest level of leadership.
What would nonprofits look like if, even for the largest organizations, the people an organization hopes to serve govern the board? Programs would look different if they were accountable in this way to the people most directly impacted by the work. Organizations could take different risks if they weren’t motivated by not losing their largest donors. Nonprofits would have access to new, different and more relevant thinking if they could look beyond the corporate, financial, legal, and business sectors for leadership on their boards. Many nonprofit experts espouse the idea that we should measure a board’s effectiveness by the percentage of the budget that board members donate. I challenge this notion. Instead, let’s measure the percentage of board members who are participating (or have recently participated) in the organization's programs. For example, the youth-serving organization Youthprise demonstrates its accountability by highlighting the number of youth who serve on its board of directors.
Share solidarity. Nonprofits are traditionally taught to specialize and to avoid “mission drift.” On the surface, this advice makes sense because we trying to address enormous challenges with very limited resources. But this practice often leads to individual organizations working in a silo, disconnected from other sectors and causes. Nonprofits need to organize and collaborate across these divides to find the bigger connections in their work. After all, the challenges we’re trying to address don’t exist in a silo. If the disparities and problems that communities face are all connected, then it stands to reason the solutions are going to need to be connected, too, even if individual organizations devote their work to a certain aspect of the solution. Consider the New Economy Coalition, which includes people from the economic, environmental, food, health, cultural, education, and policy sectors. This sort of joint approach is what will help nonprofits address the interconnected roots of the problems they are trying to solve.
Beyond broad and formal coalition-building, nonprofits can simply commit to showing up for each other in practical and tangible ways. Attending other organizations' events— learning and participating in causes outside of their own silos and comfort zones—provides valuable context and helps people identify opportunities for collaboration.
Without a shift toward abundance, nonprofits risk getting pushed to the margins while projects and models that speak the language of entrepreneurs and companies aiming to become cornerstones of a new economy take the lead. Through sharing, nonprofits can build a bigger team and a bigger movement. By sharing tools, governance, and solidarity, we can increase the potential for social impact work to grow and make real system change. This is the scale necessary to challenge the private sector for the leadership and repurposing of the “sharing economy.”