Identifying New Revenue Streams for Nonprofits

I just studied a Harvard Business School case on Yale University’s $31.2 billion endowment, and what I learned blew my mind: Yale mastered the art of turning money into more money at a scale most nonprofits can only dream of. Nonprofits can apply the same principles to break free from the endless fundraising cycle and create long-term sustainability. Let me show you how. A Masterclass in Smart Investing: Yale’s Investment Office, led by David Swensen, took an unconventional approach: ✔ Prioritized equity over fixed income → Returns beat inflation. ✔ Invested in inefficient markets → Higher risk, but also higher returns. ✔ Built long-term relationships with top fund managers → Consistency over market timing. ✔ Avoided large institutions with misaligned incentives → No conflicts of interest. ✔ Maintained liquidity while holding illiquid assets → Could withstand downturns without panic selling. The result? Yale’s endowment generates more in annual returns than most universities have in total assets. But nonprofits can apply these principles, too. What Nonprofits Get Wrong About Funding Most nonprofits rely on: ❌ Short-term fundraising (galas, one-off donations). ❌ Restricted grants (funders dictate spending). ❌ Chasing capital without a strategy (constant survival mode). This isn’t scalable and leaves organizations vulnerable. Enter Venture Philanthropy: The Private Equity of Nonprofits What if nonprofits took a venture capital approach to funding? Instead of one-off grants, they would: ✅ Secure long-term investments (multi-year funding commitments). ✅ Align funder incentives with impact (performance-based funding). ✅ Build strategic relationships with capital providers (not just donors, but investors). This is venture philanthropy, treating nonprofit funding like an investment. And guess what? It works. Nonprofits that adopt this model scale faster, sustain funding longer, and create bigger impact. How to Apply Yale’s Strategy to Your Nonprofit 1️⃣ Think Like an Investor → Stop fundraising just to “survive” and start raising capital to grow. 2️⃣ Prioritize Long-Term Funding → Multi-year commitments > one-time donations. 3️⃣ Diversify Revenue Streams → Private funding, earned income, impact investing. 4️⃣ Find the Right Capital Partners → Work with funders who share your vision (not just those who give the biggest check). 5️⃣ Play Offense, Not Defense → Build financial reserves, so downturns don’t derail your mission. Yale didn’t build a $31B endowment by accident. They followed a disciplined strategy, invested in high-performing assets, and prioritized long-term value creation. Nonprofits that do the same will break free from the endless fundraising cycle and create sustainable impact for decades. Want to level up your nonprofit’s funding strategy? Start thinking like Yale. With purpose and impact, Mario

Let’s clear the air. “Nonprofit” does NOT mean “no profit.” Nonprofits can (and should!) make money to fuel their missions. The only difference? Instead of distributing profits to shareholders, they reinvest them back into the cause. 🙌 Here are 12 ways nonprofits can generate more profit: 1. Fee for Service – Charge for programs, classes, or events. 2. Merchandising – T-shirts, mugs, or swag that represents your mission. 3. Grants & Contracts – Government funding for specific projects. 4. Memberships – Exclusive perks for members. 5. Corporate Sponsorships – Partner with companies to support your cause. 6. Fundraising Events – Galas, Fun Runs, and auctions bring in serious cash. 7. Crowdfunding – Tap into small donations from large audiences. 8. Social Enterprise – Start a revenue-generating business related to your mission. 9. Online Courses/Workshops – Share your expertise and charge for it. 10. Real Estate – Rent out extra office space or venues. 11. Investments – Smart investing strategies for long-term sustainability. 12. Endowment Funds – Build a fund that pays dividends for years to come. 💡 The point is: your nonprofit CAN and SHOULD make a profit. It’s all about reinvesting in the mission, not lining pockets. If you’re not generating surplus, you’re limiting your impact. It’s time to shift the narrative. 💥 What’s your take on nonprofits and profit? Share your thoughts in the comment 👇

𝙏𝙝𝙚𝙨𝙚 7️⃣ 𝙖𝙡𝙩𝙚𝙧𝙣𝙖𝙩𝙞𝙫𝙚 𝙛𝙪𝙣𝙙𝙞𝙣𝙜 𝙨𝙩𝙧𝙖𝙩𝙚𝙜𝙞𝙚𝙨 𝙖𝙧𝙚𝙣'𝙩 𝙟𝙪𝙨𝙩 𝙩𝙝𝙚𝙤𝙧y, 𝘵𝘩𝘦𝘺 𝘢𝘳𝘦 𝙨𝙪𝙧𝙫𝙞𝙫𝙖𝙡 𝙜𝙪𝙞𝙙𝙖𝙣𝙘𝙚 𝙛𝙤𝙧 2025. Shila N. and Samantha Musoke ACA break down why the "𝘢𝘱𝘱𝘭𝘺 𝘧𝘰𝘳 𝘨𝘳𝘢𝘯𝘵𝘴 𝘢𝘯𝘥 𝘩𝘰𝘱𝘦" funding model is quietly killing nonprofits. 💡 What jumped out at me: 1️⃣ Start with your assets, not your gaps - Before chasing new revenue streams, audit what you already own. That unused conference room? Idle vehicles? Training materials gathering digital dust? Revenue is often hiding in plain sight. 2️⃣ Corporate partnerships ≠ just asking for money - The payroll giving schemes and pro bono services models they outline create ongoing relationships, not one-off transactions. Much more sustainable than the annual sponsorship ask. 3️⃣ Reverse calls for proposals flip the power dynamic - Instead of contorting your mission to fit funder priorities, you define what your community needs and invite funders to support YOUR agenda. Brilliant. Tactical next steps if this resonates: ✓ Schedule that Financial Sustainability Strategy Session they mention (seriously, block 2 hours next week) ✓ Pick ONE model from their list that aligns with your current capacity—don't try to launch everything at once ✓ Start documenting your existing assets using their framework in section 7 𝗧𝗵𝗲 𝗿𝗲𝗮𝗹𝗶𝘁𝘆 𝗰𝗵𝗲𝗰𝗸: Your funding strategy needs to be as creative and intentional as your programs. The organizations still relying solely on traditional grants in 3 years will be the ones struggling to keep their doors open. 👉 Questions for fellow leaders: Which of these 7 models resonates most with your current context? 🔗 https://lnkd.in/gcrwWc6p Humentum

If you want to raise money for your good cause, you’ve got to follow the money. McKinsey’s latest 213-page report, The Next Big Arenas of Competition, is a real treasure trove for nonprofit fundraisers looking to tap into high-growth industries reshaping the economy. They’re projecting up to $48 trillion in revenue across some seriously dynamic sectors—everything from AI and green energy to e-commerce and electric vehicles—by 2040. With U.S. donor markets continuing to shift as the economy and demographics evolve, these growing sectors offer big new opportunities for nonprofits to create partnerships that align with corporate social responsibility (CSR) and impact giving goals. Maybe you’re already building connections here, or maybe your team hasn’t had the chance yet, especially if you’re a smaller or under-resourced nonprofit. Either way, there’s still time to get in on the ground floor as these industries grow! Here are some ways you can start building meaningful partnerships with companies in these booming sectors: 🔍 Identify Partners: Tap into your Board’s network and research companies with CSR goals, finding partners whose missions connect with yours. ✉️ Tailor Your Outreach: Get to know each company’s specific goals, then show them how your nonprofit can help them achieve their CSR mission. 🤝 Highlight Shared Impact: Paint a clear picture of how a partnership benefits both sides, including corporate employee satisfaction, consumer marketing, and government relations. 📖 Tell a Story: Bring real stories and program results into the conversation to create a compelling narrative that resonates. 🌐 Build Value First: Start with something simple—a lunch-and-learn, a volunteer event, or even an invitation to attend one of your programs—to build trust and show your unique value. 💼 Make the Ask: Once the relationship is established, propose an investment that makes a measurable impact in your community. Whether you’re from a large nonprofit or a small team, there’s potential in these high-growth sectors for everyone. Even one solid partnership can set the stage for more collaborations down the road. Want to dig in deeper? McKinsey’s report on emerging arenas is full of insights for fundraisers who want to connect with these fast-growing industries. Give it a look, and if you have your own tips for connecting with tech-driven sectors, share them below! https://lnkd.in/g2BnuiYK #NonprofitLeadership #CSR #FundraisingInnovation

I have had the opportunity to serve on several nonprofit boards over the years. There's always a period of time -- as is the case currently -- when there is real concern over government funding. That's why it is so important for nonprofits, especiallty those in healthcare, to diversify its revenues streams. Just like businesses, nonprofits need financial resilience to sustain their mission and expand their impact. Here area few ways nonprofits can diversify revenue streams and create long-term stability: 1. Develop Strategic Partnerships – Collaborate with corporations, foundations, or healthcare organizations to co-develop research, technology, or community programs. These partnerships can lead to sponsorships, grants, and new funding opportunities. Too often, folks want to forge their own path. Now is the time for partnerships. 2.  Invest in Mission-Aligned Ventures – Consider sustainable investments such as impact funds or health tech startups that align with your mission while generating financial returns. It's key to have a good financial team to help assess opportunity and manage risk. Many nonprofits have started to create such funds, and more need to do so. 3. Expand Subscription or Membership Models – Offer premium content, exclusive research, or advocacy networks for a subscription fee. Organizations that provide unique insights can turn knowledge into a reliable revenue stream. 4. Utilize social media -- This way can be way to find new funders, who may not be familiar with you work. There is a science to utilizing social media -- you just can't post and think the money will come rolling in. Invest in a seasoned team who knows how to convert metrics into dollars. A diversified nonprofit isn’t just more financially stable—it’s better equipped to innovate, adapt, and drive meaningful change.  It is easier said than done -- and it takes time. What strategies have you seen work in nonprofit revenue diversification?  #NonprofitLeadership #RevenueDiversification #HealthcareInnovation