For and Not-For-Profit Big Bang...

Wednesday, May 9, 2012 - 23:50

Two worlds are colliding and the results can only be fun.

I am sitting in the Impact Investing conference organised by the South African Network for Impact Investing (SAII) and hosted by the University of Pretoria’s Gordon Institute of Business Science (GIBS) and you can see it happening.

There are those of us from the nonprofit background (clearly visible as we don’t wear sharp cut suits or impossibly high heels) and those from the financial world, who talk a strange language of bonds and equity and use acronyms as if they are pronouns.

I often think that the jargon of business is designed to be intimidating so that those of us on the periphery are forever excluded, like little children not invited to the Top Dogs birthday party.

But this week, I had one of those moments where all became clear and suddenly it made sense. I missed the choir of angels and harps accompanying my epiphany, but it was no less dramatic.

We are all saying the same thing - just differently.

There are fund managers out there looking (yes – looking!) for social enterprises to invest in. This took a long time for the fundraiser in me to understand, as these moments are few in the nonprofit world.

These fund managers will take you through a rigorous process assessing your business, your future growth and your ability to survive independently of traditional grants and handouts. You are after all, a business. They do however, despite the sharp suits and high heels, seem to have a heart. They are just approaching us from a different angle.

So no longer can nonprofits assume that business does not understand the world of social service delivery. They bring new insights, which we must acknowledge and respect and vice versa.

So this is the Big Bang, where the world of for and not-for-profits collide.

It is a change in thinking.

We know that the traditional funding model - of dependency on finite grants, and hard-won subsidies - cannot last.
The financial stress and pressure that we all largely operate under means that we can never think ahead. We are always worrying about the now, rather than the where do we want to be.

Impact Investing may not be your thing, but the thinking of this new approach has to be explored and interrogated.
Why?

Because it encourages you to develop a social enterprise - a business wing that supports the delivery of social services. Because it is passionate about measurement and accountability. Because taking on financing  forces you out of the cushioned security of grant funding and means you have to face up to your own organisational risk: ‘Will it work?’ takes on a whole new meaning when you have to pay the money back.

And let us be honest. This is exactly what the nonprofit world has been calling for. We have just been using different phrases that ask for new funding streams, greater accountability and transparency, as well as ownership by all.

So. Sparks will fly, as our worlds slowly collide. But Impact Investing has gravitational pull and its going to be hard to resist.

- Kerryn Krige is a freelance advisor in development. She has worked for some of South Africa’s leading non-profits as a fundraiser and programme manager. She started off as a journalist and moved into the non-profit sector in the United Kingdom, working for traditional charities and social enterprise. She has worked in East and Southern Africa and is passionate about building the capacity of the nonprofit sector. You can get in touch on ayandamalindi@yahoo.co.uk.

Comments

Good article. It makes one think, hey. Thanks to the government for enforcing social responsibility among big for-profit guns. I'm doing research on 'Why NGOs come and go?' I wonder if you can help with observed hard-to-overcome challenges that NGOs face, which ultimately bring them down. Regards Bongani mthembulb@gmail.com