From Non-Profit to a For-Charity Business: An Innovative Funding Model for a Good Cause

By Justin Scaini, Capitalize for Kids

Every non-profit or charity has its own unique challenges it must overcome to provide great services, and keep the doors open. The one challenge almost all organizations can relate to is finding funding. Each institution has its own “secret sauce” for how to attract dollars. Whether it’s government funding, individual donations, corporate partnerships, a social enterprise, or other models of funding, each organization looks for funds that will work in its unique context.

Capitalize for Kids was founded in 2013, and was built around a unique funding method that has helped us become financially sustainable. We built the organization as a business first. We are a non-profit, but we think of ourselves as a for charity business.

We designed the organization with a specific attention to what product or service people will pay for that will specifically benefit and add value to them or their businesses. Rather than rewarding a specific group of shareholders, we allocate funds to children’s brain and mental health research, and run a capacity-building consulting program for evidence-based mental health service providers.

Every year we host Canada’s top Investors Conference.

We welcome over 20 money managers to speak about their best investment ideas in front of over 400 senior executives at the top banks, pensions, and family offices. This event raises about $1.5 million annually, and to date we have raised over $4 million for the cause. Everyone is at the conference because it benefits their business. We only use about 15 minutes of this two-day event to talk about children’s brain and mental health.

However, this is not to undermine the cause. Children’s brain and mental health is the number one health issue for young people today. We have metrics that inform our giving. We have created a capacity building program that helps service providers help more kids within their existing funding and staffing restraints. We don’t talk about the cause at the conference because our attendees are not paying for a social service; they’re paying to attend a high-value conference for their business.

We are certainly not the only organization approaching social impact in this way. For-profit businesses such as Wear Your Label are making social giving a key part of their business model. Many social enterprises such as Klink Coffee are providing value-added products and services to their stakeholders to generate funds to support their programs. We also apply learnings from high impact organizations such as the Robin Hood Foundation, who are the best in the business when it comes to resource allocation, and impact metrics. We’re constantly trying to learn from these incredible organizations to refine our model, and apply the best thinking to our work with respect to both funding and impact.

Thinking about Capitalize for Kids as a business first, and then designing our social programming thereafter helped us achieve a few key things very quickly:

  1. Sustainability: The Investors Conference is a product that people and companies in the capital markets sector will purchase every year. This gives us sustainable and predictable funding annually.
  2. Ecosystem: Through our Investors Conference, we have built an ecosystem within the capital markets sector. Focusing specifically on a single sector has allowed our organization to add value for our stakeholders and the capital markets sector more broadly. This in turn helps attract additional funders and supporters of the social cause.
  3. Major Gifts: Because we have been able to build up such a strong network of supporters through the Investors Conference, we have been able to rally the capital markets sector around the cause. This, in turn, puts us in a position to ask for major gifts akin to what larger established non-profits do to raise funds.
  4. Great Social Programs: Sustainable funding gave us the ability to hire professionals who are focused on building our social impact strategy, and designing new programs to grow our impact.

We feel very fortunate to have found a revenue model that we can count on every year. Maintaining and growing this revenue base, much like many of you reading this, remains our biggest challenge.

There is no single solution to funding challenges, but what we’ve learned is the importance of finding a revenue model that works for your unique context, and leveraging your supporters to achieve your major goals as an organization.

If you know of any organizations we can learn from, or would like to chat further about Capitalize for Kids, please contact Justin Scaini at justin@capitalizeforkids.com.

 

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