How Funders Can Help Nonprofits Achieve Scale

Nonprofits don’t have discrete ambitions. They want to quickly grow their seed money so they can expand programs that have both a measurable and meaningful impact. It’s one way philanthropists define “scale.”

But it is often a lot easier said than done.

“It’s hard to think about growing and scaling when you’re also thinking about next month and having to make next year come together in a way that we don’t have a deficit,” said David Cygielman, founder and CEO of Moishe House, during a JFN webinar on Sept. 4 about how funders can play a role in scale and growth.

Cygielman knows what it’s like to scramble to survive. Moishe House is a network of peer-based Jewish communities for young adults to create hubs for Jewish life. It started in 2006 as an outgrowth of a program from a private foundation. But its existence was threatened two years later when the foundation closed. Moishe House became a standalone group, and funders responded to its unique model for engaging post-collegiate Jews. It now has 70 locations on five continents.

“Sometimes it feels like we’re growing real fast. Other times it’s not fast enough,” Cygielman said, while nothing that growth comes with ongoing expenses that need to be budgeted for over the long-term.

Deborah Meyer knows that feeling. She is co-founder and executive director of Moving Traditions, an innovative education program that empowers tweens and teens to explore issues relevant to their lives—such as online bullying and drug abuse--and view them through a Jewish lens.

Many of the organization’s programs are carried out in local synagogues, JCCs, schools, and camps. Meyer is faced with the labor-intensive training of education directors and youth program leaders to run the programs while also acknowledging those positions have a “tremendous amount of turnover.” Successfully wrestling with that conundrum, Meyer said, may determine to what extent Moving Traditions expands beyond the six cities it now serves.

“Our national partners want to see that local partners will invest,” Meyer said. “We’re trying to figure out what is the actual business model. We really want to have all of our players invest with us.”

Even so, nonprofits usually need to find a low-cost path to scale. For example, Moishe House provides a subsidy and program budget in exchange for individuals hosting programs each month. But the organization doesn’t actually own any of its houses—the rent and upkeep are borne by residents. The upshot of that approach: not having to pay for staff in each city.

At the same time, few nonprofits can achieve scale on their own. That’s when funders play an invaluable role.

“I’m trying to get away from this idea of playing defense and putting out fires with grantees who are constantly dealing with financial emergencies,” said Simone Friedman Rones, executive director of the Emanuel J. Friedman Philanthropies and a Moishe House board member. “This idea of playing offense and help grantees who are successful grow is … something that we’re a lot more interested in doing.”

The importance of collaborating in these situations extends to funders themselves. The Friedman Philanthropies provided capital for at least 10 new Moishe House locations in the U.S. on the condition that funding was also obtained from donors in those cities.

“If as funders we have shared goals, then it’s really important that we work together,” Rones said. 

To listen to the webinar, click here >>