By Tifany Boyles, M.A.’15
In the social sector, many nonprofit founders are filled with hope, vision, and determination when starting their organization. But what happens when all the signs point to closing?
Sometimes, fighting for positive social change is ours to do. Other times, our nonprofit organization’s unique way of solving a problem has a lifespan. Operating beyond that time can begin to reverse the good work you have started. Knowing when, and most especially how, to sunset your organization is just as critical as having the fortitude to start an initiative in the first place.
Closing well takes as much effort as starting up. The difference is that the process is less exciting and the benefits of a job well done are awarded to other nonprofits rather than your own. Additionally, closing well requires a tired staff team and a disheartened board of directors to gird their energy and dig in for one last calling.
In this case, the calling is to leverage every single ounce of remaining resources your organization has at its disposal to successfully support others before saying farewell. If done well, this important work will leave stakeholders feeling trust and hope in the nonprofit world beyond their time with your organization. Fostering a healthy ecosystem within the sector is just as much our responsibility as nonprofit leaders as focusing on our specific mission.
Case study: BeadforLife
Consider this case study. Recently, BeadforLife faced this dilemma and decided to commit to closing its doors with grace. The goal was to set up its sister organization, Street Business School (SBS), while also taking special care of the 16 years of hope and support bestowed on them from volunteers, women entrepreneurs, donors and advocates before closing on July 31, 2020. The outcome would continue to build a culture of trust and generosity for the nonprofit sector as a whole.
BeadforLife was founded in 2004 by three women who knew when to lean into an opportunity. They encountered Millie Grace making recycled paper bead jewelry in Kampala Uganda, brought inventory to the U.S. and leveraged the home party model to turn it into a $4 million a year social enterprise within three years.
The model was right for the time. BeadforLife was a social enterprise, using the net profit of its sales to invest in its beaders, teaching them entrepreneurship and confidence. This business education program evolved into BeadforLife’s hallmark program, SBS, where women are taught to lift themselves and their families out of poverty through entrepreneurship. In 2018, SBS would outgrow its parent organization and spin off as its own nonprofit, maintaining a “sister organization” relationship with BeadforLife.
In 2010, BeadforLife started to see a decline in sales. Despite efforts to pursue alternative products, business models, partnerships, and operational structures, the fact was, the market had become saturated with fair-trade products and the home party model was no longer culturally popular.
In 2018, with the SBS spinoff, BeadforLife decided to consider closing if the trend did not shift quickly. Then, in 2020 COVID-19 dealt the final blow and the board of directors accepted BeadforLife’s fate to close.
BeadforLife chose to close with two goals in mind. First, set up its sister organization, SBS, for success. Second, partner with as many other nonprofit organizations as possible to leave the social sector stronger. In order to support SBS, BeadforLife committed to focus on funding, marketing, operations, and volunteers.
Funding: Similar to the Deutsche Bank Microcredit Development Fund as seen in this article published by SSIR, BeadforLife devoted its financial assets to its most aligned partner: SBS. BeadforLife transitioned its remaining reserves to SBS over a three-year pledge period.
Marketing: We launched a six-week digital marketing campaign to transition its newsletter subscribers and social media followers to support SBS. This campaign was strategic, exemplary of SBS, and included a match gift donor who gave $25 to SBS for every new follower. The campaign raised an additional $20,000 and increased SBS’ digital presence.
Operations: Two members of BeadforLife transitioned to SBS. This included BeadforLife’s executive director stepping into the newly formed role of chief operating officer, a much-needed role the SBS board identified earlier in the year.
Volunteers: The community of BeadforLife volunteers who championed bead sales across the country were offered two options. They could either continue to sell their remaining inventory in support of SBS instead of BeadforLife or they could transition to a new volunteer role and become a “Global Ambassador” where they host friend-raising events.
Reflecting on this transition, BFL manager Jessica Galimore said, “BeadforLife never knew for sure, and still doesn’t, if it could have survived. At least in this way, we know we did the best we could for SBS.”
“Spreading joy and giving hope”
BeadforLife had one final goal: elevate the sector by broadly helping others and by respecting the years of support granted by a global community of stakeholders. BeadforLife chose to get creative with its one last remaining resource: 200,000 pieces of product.
This consisted largely of beautiful, hand-rolled, recycled paper-bead jewelry made by women living in Uganda. The idea of throwing it away was heartbreaking. Attempts to sell it at a highly reduced cost did result in more than $60,000 in revenue, yet it only put a dent in approximately 10 percent of the inventory.
Instead, BeadforLife created an intimate task force of staff and volunteers to lead a global donation initiative. Suggestions on how nonprofits could use these products ranged from selling the product, using it for donor recognition, offering event keepsakes at virtual or in-person events, using necklaces as conference lanyards, bangles as gifts to healthcare workers during this pandemic, and so on.
Organizations were surprised and excited to be able to choose their items rather than receive a mystery box filled with items BeadforLife wanted to unload. It was this extra effort that cost BeadforLife hours of staff time and effort, but left the team feeling very proud of its impact.
Galimore said, “Spreading joy and giving hope to other organizations who were also struggling right now during COVID-19 felt right.” BeadforLife was able to move every single product, without a single piece going into the landfill.
The initiative granted packages of 2,500 to 10,000 pieces to 41 different nonprofit organizations throughout the country. Organizations ranged from international anti-human trafficking organizations to the local Women’s Foundation of Colorado, among others.
The experience of BeadforLife closing taught us all that endings can be powerful opportunities to leave the sector stronger than when you found it. However, leaders should know that doing this work well does take significant time and determination.
If COVID-19 sparks considerations to close, take a page from BeadforLife and devote the resources and intellectual effort to do it well. You will leave the sector stronger and lift us all in the process.
Tifany Boyles is the director, global philanthropy at Street Business School (SBS) and founder of her consulting company, Red Philanthropy. At SBS, Tifany leads philanthropic partnerships, thought leadership, and stakeholder engagement for SBS as they scale their entrepreneur training and self-efficacy program through a social franchise model to ignite the potential in one million women globally. She has previously worked with corporate foundations, such as Western Union Foundation, and multi-lateral NGOs, such as UNICEF, to foster an environment in which women and children can achieve equality and overcome injustice. Tifany holds a bachelor’s degree from Pepperdine University and a master’s degree in philanthropic studies, concentrating on impact investing for gender equity, from the Lilly Family School of Philanthropy at IUPUI. She is also certified in Women’s International Health and Human Rights through Stanford’s Center on Social Innovation.