Mission + Strategy = Social Value

"Round-Up of the Week's News on Nonprofit Collaborations"

At the suggestion of a fellow blogger and friend, Celeste Wroblewski at studio 501c, I am going to add a new feature to my site: a news round-up. Every day google alert sends me news stories about nonprofit mergers, partnerships, and all things related to nonprofit strategic re-structuring. I have far more material than I have the space (or time) to write about. So instead of trashing the stories, I am going to send you the links to the more interesting alerts and let you decide which ones to read. I will still post blog entries about the evens I find interesting, too. If you like, let me know what you think of this new feature by sending me a comment. Also, let me know if you found a story particularly interesting, and I'll check it out. Happy reading!

"Thinking like Businesses," by Hartfordbusiness.com, an editorial supporting the decision by some nonprofits to start considering mergers. An overview of some notable examples in the state of Connecticut.

"Anxiety on the rise at area's nonprofits," by Warren Wolfe, StarTribune.com, Minneapolis-St. Paul, MN. An overview of merger activity in the Minneapolis-St. Paul area due to the decline in finances for nonprofits.

"Area nonprofits feel urge to merge," by Laura Crimaldi, BostonHerald.com. An article covering a report by the Boston Foundation detailing the financial woes of the Boston nonprofit sector and their efforts to get organizations to consider mergers.

"Nonprofit Mergers: Putting the Best Foot Forward," by Scott Russell at the Minn.Post.com; an overview of Minnesota mergers and one merger in particular between COMPAS and Young Audiences of Minnesota. The article goes on to talk about a free publication on mergers, among other things interesting.

"Merge Ahead," by Bruce Boyd, On Philanthropy. A balanced opinion piece about nonprofit mergers by a consultant in the field, which begins by citing a recent study by the Nonprofit Finance Fund on nonprofit collaboration activity.

"Social services agencies ACHIEVA and Arc of Westmoreland County merge," by Kris B. Mamula, Pittsburgh Business Times. An article covering the decision by two notable social service agencies in the Pittsburgh, Pennslyvania community, to merge.

"Nonprofits Forced to Think Differently," by the Seacoastonline.com. An editorial lauding the decision by two Northampton-based nonprofit organizations to merge: Seacoast Visiting Nurse Association and the Massachusetts-based Home Health VNA.

"Literacy Nonprofits Merge" by Pam Allen, The Business Review (Albany). An article about two nonprofit literacy organizations in new York state which decided to merge: Literacy Volunteers of America/Mohawk/Hudson and Literacy NENY.

"A Merger that will Assist the Area's Jobless," by the News & Advance, Lynchberg, Va. An opinion piece supporting the potential merger of two nonprofit organizations providing services to unemployed individuals in Central Virginia: New Lands Jobs and Lynchberg Community Action Group.

Learning from the Nonprofit Merger Trail Blazers: An Interview with Debbie Hinde, CEO of Vital Bridges

As I introduce people to the concept of nonprofit mergers and collaborations, it's hard to remember that for some people, these concepts have been around a long time. Take Debbie Hinde and Vital Bridges in Chicago, Illinois, for example. I recently was re-introduced to Debbie when she was part of a group of HIV/AIDS social service agencies meeting to hear a presentation from me at the AIDS Foundation of Chicago about strategic re-structuring. Debbie could have given the talk and in fact, I asked her at one point in the training to tell her story.

It was 2002 and the AIDS service sector in Chicago was greatly fragmented with over 200 nonprofit agencies, a great many of whom were providing one or two services to a small clientele who were then forced to go from organization to organization to get all their needs met. Many of these small nonprofits, each with their own overhead operations, were financially unstable and inefficient. At the same time, the funding environment for AIDS services had changed dramatically due to the downturn in the economy at that time and shrinking private dollars due to the perception that the disease was now a manageable problem.

Due to these conditions, three HIV/AIDS service organizations decided to merge together: Open Hand Chicago (the organization Debbie was leading at the time); Community Response, Inc.; and the HIV Coalition, Inc., or HIVCO. The goals of the merger were twofold: to expand and enhance client services; and to build financial strength and stability for one nonprofit. The result became Vital Bridges, the combined entity with a budge tof $4.6M, serving a clientele of 2,400 people in metro Chicago living with HIV and AIDS.

Vital Bridges has gone on to improve services to their clients including expanding the availability of fresh fruit and meat throughout their distirbution area, launching 32 units of permanent and transitional housing, and adding mental health therapy to their portfolio of services. Case Managers are now available to clients in a one-stop-shop format in their grocery center sites when people pick up food. And there is now one lean, efficient, financially strong administration running what was once three separate nonprofit agencies.

The Bridgespan study on nonprofit mergers, M&A: Not Just aTool for Tough Times, makes the point that the rate of nonprofit mergers is roughly the same (1.5%) as it is for the for-profit sector (1.7%). People are shocked to learn the nonprofit rate is a shigh as the for-profit sector. That's because a lot of small to medium-size nonprofit organizations are very quietly merging without a lot of fanfare, but with great effect. Vital Bridges is one example of the quiet leaders in the nonprofit sector which some time ago started using strategic re-structuring tools to expand mission for their clients. And seven years later, this merger is still having impact today.