Avalon was recently surprised to learn that one of the digital partners for a client based their fees on a percentage of revenue raised for a client. I’ll start by saying I believe that leading a culture of principled decision-makers is more ethically robust than micromanaging a team of rule-followers. However, the “golden rule” for […]

Avalon president Allison Porter recently explored best practices for trying new channels, creative, and investments in her DMAW Advents article: “The Next Hot, New Fundraising Idea – It’s Risky Business.” In it, she wisely counsels fundraising professionals to understand, mitigate, and be transparent about the risk of trying new things in nonprofit fundraising. She explores […]

A Day at the Park with Avalon!

On June 9th, Avalon celebrated its annual Summer Fun Day with a trip behind the scenes at Nationals Park in Washington DC. With our storied tour guide Bob at the helm, we took a trip inside the stadium, with visits to the Red Porch Restaurant, Diamond Club Lounge, Shirley Povich Press Box, and Visitor’s Clubhouse. We even spent some time in the Nationals’ dugout! Avalon had a great time learning about the history of DC baseball, chatting with Bob, and coincidentally seeing star left-fielder Bryce Harper rehabbing a bit on the field – truly a once-in-a-lifetime experience.

We finished the day with a reception lunch at Bluejacket Brewery. From the delicious food to a fun atmosphere to great service, it was precisely the best way to celebrate. And, making the occasion even more special, we toasted our colleague Kate Cecchini Beaver, Senior Data Manager, on her tenth anniversary at Avalon. You know Kate best as the brain behind our Merlin Performance Reports; we love her not only for her impeccable data work, but also for her fun personality. Happy anniversary, Kate!

Click here and see below for photos from our spectacular event! 

DMAW’s annual meeting included a timely and important discussion of charity evaluators, impact strategy and that controversial measure of nonprofit effectiveness—the overhead ratio.  The panel, “Charity Watchdogs, Donor Perceptions and the Overhead Myth” featured an impressive lineup, including:

• Steven Nardizzi, executive director, Wounded Warrior Project
• Dan Pallotta, founder and president, Charity Defense Council
• Bunkie Righter, director of business development, Guidestar
• Art Taylor, president and CEO, BBB Wise Giving Alliance
• Andrew Watt, president and CEO, Association of Fundraising Professionals

Three conclusions stood out to and, frankly, inspired me that evening: an alignment of interests among the parties represented, a call for strategic responsibility, and a related call for better and braver messaging. 

Alignment of Interests

Contrary to popular belief, charity evaluators, nonprofits and impact prophets don’t need to duke it out.  While nuanced arguments remain, the big players in this debate share some important commitments.  Most importantly, they are committed to the work that nonprofits do—maximizing benefits to their constituents and local communities. 

Each perspective is exactly that—a perspective on how nonprofits can best go about their work.  The so-called “watchdogs” are evaluating nonprofits in order to safeguard the public trust and donors’ commitment to philanthropy writ large.  Nonprofits are doing the work they do best—addressing the needs of their constituents and executing their missions.   And those who prioritize impact are urging nonprofits to think bigger and do more. 

They offer different angles on a shared concern—strengthening and scaling the missions of nonprofits around the world.  A hostile or oppositional posture does nothing to further that purpose.  To that end, Dan Pallotta rightly suggests that we stop using the word “watchdog,” favoring instead a collaborative framework.

Strategic Responsibility

Smart nonprofit leaders understand the root causes of an organization’s overhead, as well as the high-altitude decisions that have led there.  They also understand the decisions that can either change that result or maintain it.  And they own the responsibility to make those decisions purposefully on behalf of their nonprofits’ missions and stakeholders. 

Steven Nardizzi offers Wounded Warrior Project as a compelling case for choosing one’s overhead ratio.  For example, Wounded Warrior does not accept government funds, a commitment that increases the nonprofit’s overhead ratio, yet gives it a stronger position when advocating for injured service members on the Hill.  They have likewise refused sponsorship from companies selling alcohol, again choosing to accept a higher overhead rate on behalf of Wounded Warrior’s constituents, who suffer from higher than average rates of substance abuse.  This example teaches us that overhead ratios aren’t a circumstance happening to nonprofits—certainly not the strategic ones.  Like Nardizzi, nonprofit leaders should put their strategy first and stop managing to rigid overhead thresholds. 

The thresholds are counterproductive when they cause nonprofits to underreport costs or spend inadequately.  They generate bad decisions that result in withering donor files and stunted potential.   We agree with Dan Pallotta that, in order to grow, nonprofits must increase their investment dramatically—and we agree that most are not investing sufficiently.  Nonprofit leaders are too often afraid to authorize the very growth strategies that will enable them to do more for their constituents.  Stanford Social Innovation Review has called this the “Nonprofit Starvation Cycle.”

Institutional Messaging

The tough reality here is that nonprofit leaders must get comfortable discussing these matters.  They have a responsibility to morph stakeholders’ concern for overhead ratios into more substantive conversations about an organization’s strategic mission.  Peter Kramer recently made a complementary case for candidness in The Chronicle, addressing the need for complete and specific financial discussions between nonprofit leaders and funders.

Last week, Andrew Watt urged the DMAW audience to “change the tide” on this discourse, reprimanding us all for failing to communicate what we do and why.   This is a tough, but vital, call to action.  Nonprofits need institutional communications strategies and marketing strategies, not just fundraising strategies—and they should be prepared to invest there too. 

Fundraising professionals who get this—both within nonprofits and in counsel to them—should lead the charge to clarify message across departments and throughout hierarchies.  We must advocate for our nonprofits to invest as required.  And we must coach our colleagues through this process.  Why us?  Because we are experts at messaging—it is the cornerstone of our impact as fundraisers. 

My last post on ethics, Fundraising’s Dark Side and What To Do About It, was written at the height of the 50 Worst Charities scandal. I was—and still am—concerned about the hard look in the mirror that both nonprofits and nonprofit service providers must take. Are we doing everything we can to lead ethical organizations? Are we training our newest team members on industry ethics? Are we holding our seasoned veterans accountable? Only then can we respond meaningfully to the legitimate concerns raised by the 50 Worst Charities investigation.

At Avalon, we have spent most of 2013 taking the hard look described above. This was fortuitously precipitated by our nomination for the National Capital Business Ethics Award (NCBEA). Participation required both reflection on and documentation of our commitment to ethics from a number of angles. To get an idea, consider this list of the topics covered in our application and interviews: executive commitment, corporate policies, training programs, employee satisfaction, community involvement, and, of course, specific examples of ethical decision making.

And, drumroll please…WE WON! Avalon was awarded the NCBEA’s 2013 ethics award in the small business category. The awards ceremony was a fun and inspiring event spent in conversation with other professionals who, like us, believe that good ethics make good business. Allison Porter and I were in attendance, and, as I’m sure you can imagine, it was a huge thrill to hear the judges call Avalon to the podium.

As fun as that evening was, the staff meeting that followed was even better. We shared a video of the judges’ remarks, which not only complimented Avalon’s managerial ethic, but also praised the entire Avalon staff for understanding and embracing it. Of course, we already knew that the Avalon team is comprised of honest and earnest fundraisers who are committed to our clients’ best interests. But we welcome the affirmation and the opportunity to say THANK YOU to each of them for their part in the honor.

Today at CNN.com and tonight on CNN’s AC360°, fundraising is taking some heat. The national media outlet is reporting on recent investigations from the Tampa Bay Times and Center for Investigative Reporting, which reveal outrageous ethical breaches in our industry. Closer to home, The Agitator’s Roger Craver issues a tough call to action for fundraisers—and Avalon is glad to see it. He writes:

We must ask questions and offer advice.

• What additional roles should and can professional organizations like the DMA and AFP play?
• Should we mount a campaign to arm the regulators with more teeth? To demand swifter, more meaningful enforcement?
• Why do the truly clean and transparent charities, agencies and consultants stand by in silence as others steal their names and reputations

Why? Why? Why?

Recently, Avalon staffers had the opportunity to do some spring cleaning while making a real difference in our community. Avalon’s office building in downtown Washington, D.C. was challenged to hold a used-book drive by the terrific local nonprofit Turning the Page. Turning the Page’s mission is to link D.C. public schools, families and our community so that, together, we can ensure D.C. students receive valuable educational resources and a high-quality public education.