Editor’s Note: Ryan Seashore is the founder and CEO of the non-profit programming educational service, CodeNow, and a former associate in the White House Office of Presidential Personnel.
The nonprofit model is broken.
Unless you’re part of a unicorn nonprofit like Charity: Water then your organization likely has too much overhead, too much bureaucracy, and a lack of focus on impact. Everything feels slow.
But things are beginning to change. Technology, new organizational frameworks, and alternatives to traditional fundraising are allowing new and early-stage nonprofits to consider adopting models more similar to a for-profit startup. The ways of the startup are being taken up by nonprofits — except that we’re not so much about moving fast and breaking things, as we are moving fast and helping them.
Last year I had the good fortune to be part of the first batch of nonprofits to go through Y Combinator. Even before YC, I had subscribed to the principles of the lean startup and consistently tried to apply those methods to my nonprofit, CodeNow. Nevertheless, the YC experience was transformative in terms of how I viewed growth, vision, and hustle at the nonprofit level. I’ve never been pushed harder and accomplished more in such a short period of time.
From my time at YC I’ve picked up a number of lessons that I think are worth sharing and important to think about if you’re leading, or working for, a nonprofit.
It’s incredibly important to find your organizational focus. Most nonprofits have an innate desire to help each person as much as possible, but the truth is, you cannot be everything to everyone. Many nonprofits get stuck trying to provide too much to too few people. Instead, identify one thing your organization does best and set your goal. Put 100 percent of your efforts on that single goal and widen your impact to apply to more people. Narrowing your goal and finding that focus is the only way to successfully scale as a startup would and reach critical mass. Bayes Impact, another Y Combinator nonprofit, has done a great job of picking a specific service (data science) to focus on, which can have a massive effect on organizational and civic efficiency.
On top of this, never stop innovating. Just because you have a program that works doesn’t mean you should be complacent and think you’ve arrived. Like any startup, continue to roll out and test new features or program delivery models.
In fact, you should consistently be A/B testing all aspects of your model. You may have your focus, but that does not mean your current method of delivering your service or product is the most efficient. Most nonprofits establish their model early on and then feel too entrenched to ever change it — even if it’s unsustainable. It’s important to test various approaches until you find the most effective way to make a difference. Sometimes this means you pivot a few times until something really sticks.
At CodeNow we’ve tested everything – from classroom teaching methods, to teacher-student ratios, to types of content, length and depth of program, and methods of retaining student attention. We constantly iterate on our training. YC stresses the importance of talking to users: find out what they like and don’t like. For CodeNow, this means connecting with our volunteer trainers and alumni students. For example, after each workshop we have a download session with trainers and discuss what worked, what didn’t, and how we can improve. This allows us to continually learn and iterate.
It takes time to figure out what works well, which is difficult if you are heavily reliant on a small group of donors and traditional fundraising, which tends to be a time-intensive effort. For this reason, it’s also useful to think of alternate sources of revenue to keep your nonprofit sustainable over the long term.
A great example of this is 826 Valencia in San Francisco, which also sells goods at its Pirate Shop. Although I haven’t found an alternate revenue answer for CodeNow just yet, I’m very mindful of exploring our options. While you do this, however, keep in mind that your mission always comes first and such alternate sources of revenue are complimentary to your vision. It’s easy to get sidetracked if something starts bringing in good money — don’t get distracted.
If you want to effect change on a massive scale then you also need to identify your barriers to scale and figure out how to overcome them. For many nonprofits, the biggest constraint tends to be related to the fact that you have a finite amount of time to work every day. Figure out how to provide the same result while curtailing the time and energy to provide it. Find synergies with for profit companies, use technology like crowdfunding to reach more people (as Watsi, another leading nonprofit, has done) and look at other nonprofits to see who is having a big effect while keeping overhead low.
If you try to do everything yourself you will not be able to scale. For example, at CodeNow we went from full-on organizers (very time consuming), to becoming content creators and facilitators. Now, instead of organizing and teaching classes ourselves, CodeNow workshops are taught by technology companies, in their offices, by their volunteer engineers. We facilitate by providing the curriculum, classroom framework, hardware, student recruiting and volunteer training. This allows us to facilitate far more workshops for underrepresented students, making a much larger difference. We’ve turned our model into a massive CSR effort by technology companies who are looking for ways to foster a deeper and more integrated talent pool in the coming decades.
Lastly, don’t be afraid to think big. What does “real impact” mean to you and your organization? This was probably my biggest learning from YC — you must have a really big vision, get out of your comfort zone, and imagine how far you can go. Starting any type of organization — either for or nonprofit — is difficult and stressful. There are always a million moving pieces. That means you have to have courage to take an idea to its maximum potential.
One Degree is a great example: their mission is to make it easier for people to find community resources, and so they thought big and decided to create a Yelp for social services. Thinking big will actually help clarify your mission and make it easier to make decisions that support that mission on a daily basis. Be confident in your vision and set ambitious goals like tripling the number of people you impact every year.
None of these lessons are easy to implement. They take time, hustle, and sweat. But the nonprofit world must embrace the nimble ways of successful startups to become more effective, and do better. Don’t be afraid to move fast, and help more.