Which Two Nonprofit Revenue Streams Do Leaders Predict Will Be the Most Stable in 2020?

What's Really Happening with Nonprofit Revenue report on angleIn June, Gail Bower and I launched the study, What’s (Really) Happening with Nonprofit Revenue?

How do you answer this question? What do you expect to happen to your revenue by the end of the calendar year?

We learned that 74 percent of nonprofits across the United States expect revenues to decrease before year-end. Despite this sobering news, many other leaders anticipate their revenue will grow or be the same as in 2019. One leader even predicted revenue growth of more than 50 percent by year-end.

Besides revenue as a whole, the survey zeroed in on the nonprofit sector’s six cash income sources.
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Which of the six cash strains do you think causes the most concern?

If you guessed, earned revenue related to programming and admission, congratulations, you’re 100 percent correct.
We cannot conduct any of the ten programs that generate net revenue due to closures.
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What comes next after earned income from programs and services in terms of anxiety?

Was it individual donations, corporate sponsorship, government, institutional and corporate grant, and gifts, or earned revenue unrelated to your mission (snack sales, parking fees, etc.)?
Surprisingly, the answer was individual donations. (For more on the six sources of nonprofit cash revenue, see 7 Nonprofit Income Streams.) This answer intrigued us because the category “individual donations” is also the top source about leaders feel the most optimistic, as reflected in their answers and comments.
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Donors have really stepped up! We are trying to ‘front-load’ as many donors asks as possible in the year, in case the downturn in the economy later in the year makes it hard for folks to give.
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This overview leads us back to this post’s title question. Where do nonprofit leaders foresee revenue stability?

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Before you read what the participants said, what is your guess?

Give yourself a score of 100 percent if you guessed: 1.) Government and 2) Institutional and Corporate Grants and Gifts. These sources had the greatest predictability in June.
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We are receiving a large capacity grant and also seem to be on the map now of some larger well-known foundations.
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What This Data Means to You

Data helps. From it, you understand the perceptions of others swirling around you. Yet, you also know that what you do with data is what makes studies like ours valuable. Here are some recommendations.
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Three Top Take-Aways

  1. In the last quarter, the U.S. population moved ahead a decade in their digital platform knowledge. While digital has limits, it also has significant benefits. Two include its low cost compared to live interactions and geographical reach. Where will you incorporate these benefits to achieve your goals?.
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  2. Even in the worst of times, nonprofits find solutions to thrive. In the study, I discovered three leadership conditions: overwhelmed, accepting, and solving. Solving leaders focused on moving their organization from “shock and awe” to finding and connecting the dots to their future. Where and when are you and your nonprofit solving now? How can you start from that mindset more?.
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  3. Revamp your strategy. In light of the pandemic, nonprofits are resetting their strategies, that is, their master plans on how to win. Collectively, we learned that even the most tried and true revenue strategies become unstable. Given the changes we faced and face, you need a fresh look or a major overhaul of your vision roadmap. If you fail to invest here, you’ll end up exhausted and adrift with fewer resources. When will you stop focusing on pandemic fires and invest in developing your strategy?
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For more, download the study report here. Watch the video. (Each includes additional recommendations on how you can use the data.)

 

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