With rising costs for charitable work and a decline in giving during difficult economic times, every dollar you dedicate to doing good needs to produce the greatest SSROI (Social/Spiritual Return on Investment). Evaluating the work and efficiency of any nonprofit endeavor is important to knowing your effort makes the greatest difference.
Every donation, whether a one time or regular gift, is gone once spent in promoting your mission. This creates the need for continual fundraising efforts to maintain ongoing work. New donors are needed as inflation, growth in outreach and attrition of donors demand more dollars. The perpetual work of fundraising keeps donors involved and informed, but also uses valuable staff and volunteer time to keep programs moving forward.
Some investments in your organization’s work can provide repeated returns for a single effort. This is the purpose of contributing to an endowment fund. With low interest rates and a need for cash flow to maintain the mission, endowment funds require a large balance and produce a small return. Investments in an endowment fund cannot be spent and are always at risk.
The nature of a social business enterprise is to create ongoing income and growth in financial resources over time. Just as any profitable business increases in value and provides income for owners, employees and shareholders, a cause based social enterprise can grow and provide ongoing income when successful. This residual income reduces the need for repeated fundraising events and campaigns.
When considering a social business enterprise to produce residual support for your organization, the social and spiritual return on investment must be evaluated in light of the original investment of time and money. Running a typical business requires managing products, people or property, providing services, keeping records and customer service or startup costs. A large investment is generally counter productive regardless of income generated for your cause since the time, money and risk associated with it distracts from the focus on your mission.
Every organization, however, has one valuable asset that can be invested for the common good. It is less obvious than their financial resources, but may be worth even more to your mission. The social connections you share with each other and others outside the group create an affinity network of trust and communication. In today’s marketplace, this social network is highly valued by corporations willing to pay for the opportunity to introduce their own business to your members.
Never place the integrity and relationships of your organization at risk of being harmed by commercial interests by corporations that operate according to typical marketing methods of deception, guilt, shame, greed, fear, enticement and pressure to “buy” your members loyalty. These forces are so common in marketing efforts, we have come to accept them as normal and may be blind to the harm they can do to a community with a shared commitment to a common cause.
Invest your social capital carefully and wisely. Don’t put your most valuable asset at risk of being lost or weakened. Measure the potential social/spiritual return on investment in terms of the good that may be accomplished, care for relationships in your community, and financial support to accomplish your goals.
With careful planning, you can safely invest your social capital through voluntary participation in a low key marketing enterprise that generates significant support for your mission without risk to relationships, reputation, or the cause you serve. The right social business enterprise can even strengthen relationships in your group through collaborating for the common good and connect you with new people in your community.