Articles
UB Viewpoint - Profits for Nonprofits: An Oxymoron?
Today's headlines continually remind us of the difficulty of allocating scarce resources to the ever-increasing needs of our society.
In this season of heated political campaigns at the national level and contentious budget deliberations at the state and local levels, there is much rhetoric about running government more efficiently; "run it like a business" has become the mantra.
Buried in these stories of the day is the harsh reality of severely diminished support for the scores of nonprofit organizations whose core missions address our community's most difficult challenges. They, too, must now "run it like a business"...and more, if they are to survive.
More than just being fiscally efficient, today's nonprofits are discovering that there may be a market for their product, service or expertise and that they can generate a heretofore-unknown item—profits. This is a foreign concept to many, as are the notions of competition, pricing and marketing. Yet, this is precisely what "running it like a business" is all about. This is what we teach.
Can Baltimore's nonprofit organizations create new businesses that generate increasing streams of income—and profits—so that they may reduce their reliance on governmental and philanthropic support? We at the University of Baltimore believe the answer is "yes" and, along with others, are committed to nurturing this evolution both in the community and with our students.
A wonderful initiative is under way in Baltimore—led by the Annie E. Casey Foundation and the Open Society Institute, with the support of The Goldseker Foundation, the Alvin and Fanny B. Thalheimer Foundation, the Aaron & Lillie Straus Foundation and the Baltimore Community Foundation—to launch several for-profit social enterprises competitively selected from the ranks of the city's nonprofit organizations.
This yearlong initiative, the Baltimore Collaborative, is spearheaded by Community Wealth Ventures, the Washington for-profit subsidiary of Share Our Strength.
The University of Baltimore is a proud member of a team that is focused on building these entrepreneurial social enterprises, one of the least noticed but fastest growing areas of small business today. There is an increasing number of successful ventures nationally that serve as role models and their stories are well told in "Powering Social Change".
"Running it like a business" is the tone that was set on the first day of the Baltimore Collaborative. Ninety Baltimore-area nonprofit organizations were invited to attend a daylong orientation session and encouraged to apply for admission; 38 did so and 16 emerged as semi-finalists.
This group then had to compete with oral presentations, site visits and interviews to win a spot as a finalist. UB's Robert G. Merrick School of Business also competed to be a partner and we are proud to have 16 students from our MBA and MFA programs working with the eight selected nonprofits.
The students will be working on real-life business plans with entrepreneurial management teams, faculty and staff from Community Wealth Ventures to build profitable ventures that will sustain and enhance the core missions of the BioTechnical Institute of Maryland, Vehicles for Change, Goodwill Industries of the Chesapeake, the Caroline Center, the Parks & People Foundation, the Bon Secours of Maryland Foundation, the Patterson Park Community Development Corp. and the Chesapeake Center for Youth Development.
Profits for nonprofits is not an oxymoron; it's good business—good for the nonprofit organizations, good for Baltimore and a timely and most appropriate role for the University of Baltimore. What could be a better learning environment for our students, Baltimore's future leaders?
