Ken Goldstein, MPPA

Ken Goldstein has been working in nonprofits and local government agencies from Santa Cruz, to Sacramento, and back to Silicon Valley, since 1989. He's been staff, volunteer, board member, executive director, and, since 2003, a consultant to local nonprofit organizations. For more on Ken's background, click here. If you are interested in retaining Ken's services, you may contact him at ken at

Thursday, March 13, 2008

National Volunteer Week is Coming...

volunteers are beautiful people - let your inner beauty shine; volunteer

National Volunteer Week is coming up this April 27-May 3. It's the biggest volunteering event on the calendar, and it's a great opportunity for you to encourage socially minded folks (like your organization's supporters) to participate in local activities.

Head on over to the VolunteerMatch web site and read the press release to find out more about National Volunteer Week, and how your nonprofit can tie into this promotion.
“National Volunteer Week is a terrific opportunity to harness the growing, nationwide surge in volunteerism,” said Greg Baldwin, president of VolunteerMatch. “It affords a chance for individuals to reach out and discover fun and meaningful volunteer activities in their own neighborhoods.”
VolunteerMatch is helping transform the landscape of nonprofit outreach—connecting good people directly with good causes, and providing access to an entirely new generation of volunteers who are eager to contribute. Since 1998, volunteers have generated just over 3.4 million matches to the 56,784 local nonprofits registered with VolunteerMatch.
On a personal note, I generally do not use my blog to simply edit and repost press releases I receive in my email (if I did, I'd be posting three or four blogs a day). When I do pass along information from a press release it is because it is an organization or a cause that I believe in and find value in.

I have used VolunteerMatch to find volunteers for several nonprofit organizations and have found it easy to use and highly effective in recruiting quality volunteers. If you can possibly use the theme of National Volunteer Week in your recruitment efforts, I think you will find it well worth your effort.

Wednesday, March 05, 2008

Market failure and collusion in the philanthropic marketplace

That's a bit of a heady title, but stick with it and humor me for a minute or two longer. I'm going to use a lesson from basic economics 101 to explain why nonprofits are unnecessarily forced spend too much time and energy chasing dollars instead of achieving their missions.

Cast your mind back to college days. and remember that intro to economics class. Remember how the supply and demand curves are supposed to work? In a functioning market, each are at least somewhat elastic. When demand outpaces supply, shortages occur and prices rise till supply can catch up. When supply outpaces demand, prices begin to drop. In each case, the correction (either dropping prices or increased supply) brings the market back into equilibrium. Ta daa! The invisible hand at work.

When these forces fail to bring the market back to a working situation, for whatever reason, the resulting state is called a market failure. One possible cause of a market failure is collusion; where a number of players one side of the equation agree to withhold either supply or demand in order to manipulate the market for their own ends.

Okay, so now let's look at the market for foundation grants to nonprofits. It is an accepted fact of life that the demand far outpaces the number of grants awarded. We know that the rule of thumb is that only one in twelve proposals will be funded (some of us do somewhat better than that, but it's balanced by those who do worse), and that none of us who have been at it long can boast of a perfect record of every proposal funded.

Because of a low supply of grants from foundations, nonprofits pay a higher than market price for searching out, applying for, and managing what few grants are available to them. Economics 101. That higher price nonprofits pay to receive grants has to come from somewhere, so it comes from programs; from mission.

This would suggest that there's a shortage in the supply chain of charitable dollars. But that's simply not true. Foundations are sitting on massive endowments that could satisfy most any nonprofit's needs. These dollars have already been earmarked for charitable purposes and the donors have already received their tax benefits at the expense of the public treasury. So why are they not being distributed?

And that's where the collusion comes in. While the IRS requires that foundations spend out a minimum of five percent of their endowments each year, the majority of U.S. foundations have taken that five percent to be the industry standard (a few notable exception spend at higher rates, and they are to be commended).

In the face of a contracting economy, with rising demand for the social services provided by the nonprofit community matched with fewer dollars to pay for it, this collusion of foundations has become the single largest impediment to nonprofits succeeding at their missions and a danger to the public safety, health, and societal well-being.

Alright. Maybe I'm going a bit too far here. I like to exaggerate to make a point. But the fact stands: In tough times the community of foundations have the ability - and I would argue social responsibility - to step up to the plate and increase the flow of grants.

And, while we're at it, maybe they can cut some of the administrative burden associated with the process. Oops. I know. This time I've really gone too far.