Search Results for: forge

The FORGE Story & The Wall Street Journal

April 24, 2009 – 11:16 am

The FORGE story dominated many of my blog posts from December of last year. It was the first time that the Tactical Philanthropy Community came together around a specific nonprofit. From the hours of pro bono consulting of Tactical Philanthropy reader Curtis Chang to the many, many comments from readers offering advice and constructive criticism to FORGE to the $50,000 anonymous grant from a Tactical Philanthropy reader that closed FORGE’s funding gap and helped set them on the path to restructuring their fundraising program, I’m still in awe over the generosity of the Tactical Philanthropy Community.

So I was thrilled to see that the Wall Street Journal included the FORGE story yesterday in a special section on how for-profits and nonprofits are working to survive the financial crisis. In the article titled Helping Themselves, Wall Street Journal reporter Shelly Banjo profiled a number of nonprofits that are thinking creatively in an effort to survive:

It isn’t just the economy that’s battering nonprofits. Many have been victims of recent financial scandals, and several have had to shut their doors as a result.

That has eroded trust among donors, and the only way to regain that trust is for nonprofits to be open about their finances, operations and policies, says Sean Stannard-Stockton, principal and director of tactical philanthropy at Ensemble Capital Management LLC of Burlingame, Calif.

Mr. Stannard-Stockton points to Forge, a nonprofit that implements community-development projects — such as building libraries and schools, running job-training programs and facilitating microloans to farmers — for refugees in Africa.

Forge hasn’t been caught up in the recent financial scandals, but it encountered other difficulties. Forge started out sending students, each of whom committed to raise $5,000, to work with the refugees. But in 2007, the organization eliminated the volunteers and instead employed the refugees themselves to design and lead the projects. That also eliminated a chunk of the organization’s revenue stream just as Forge was losing other donations amid the economic downturn, leaving it to face a $100,000 budget shortfall for 2008.

In response, Forge founder Kjerstin Erickson began blogging about her mistakes and Forge’s situation on socialedge.org, an online community for entrepreneurs, nonprofit professionals and philanthropists to discuss approaches and solutions to social problems. She began by telling her story and unveiling her financial records to the public, down to details including staff salaries and budgets.

Within days, bloggers, nonprofit consultants, foundations and donors caught wind of the story and began asking more questions and offering suggestions. Some readers stepped up to offer Ms. Erickson free consulting help, and a foundation followed with a $50,000 donation. Eventually, increased donations erased Forge’s budget gap.

"Public confidence goes up, not down, when people quickly and honestly admit their mistakes and explain how they are going to move forward," says Mr. Stannard-Stockton, who picked up Forge’s story on his own blog.

Philanthropy experts warn that nonprofits can’t rely on transparency to bail them out of a financial crisis. "Transparency isn’t a tactic you use to fund-raise, it’s a value for your organization to adopt," Mr. Stannard-Stockton says. But it does build trust and understanding among donors, making them more likely to continue giving.

You can read the full article, which profiles a number of efforts, here.

Thanks to all of you that helped FORGE help themselves!

Job Opportunity at Foundation that Funded FORGE

January 9, 2009 – 12:41 pm

Last month I disabled the Tactical Philanthropy Job Board due to lack of postings. My policy going forward is that I will generally not post job openings unless they are of very specific interest to the Tactical Philanthropy Community. Just being related to the field of philanthropy is not enough of a connection.

Today I’d like to post an interesting opening from the anonymous foundation that funded FORGE. At the time they laid out the reasons why they made the grant. I think this is an interesting, innovative group whose strategies would resonate with the Tactical Philanthropy Community. The job opening is below. If you are interested, shoot me an email and I’ll send you details.

About the Foundation:

The [deleted] Foundation is a family foundation based in Palo Alto, California. The Foundation invests in and serves social entrepreneurs and innovative organizations with a focus on poverty alleviation, and youth empowerment. Additionally, the Foundation seeks to engage and invite the philanthropic community, young people, and every-day citizens to better create lasting social change.

The [deleted] Foundation is not simply looking for individuals in need of employment; we are looking for passionate, dedicated people with a lifelong commitment to improving society. Being a part of the team will provide a unique opportunity to help shape a great foundation. Each team member will have an important role in developing the Foundation’s strategy, program design, and overall positioning in the field. Staff will assume an attitude of learning, a willingness to challenge ideas, and the courage to take risks. Staff will also be responsible for providing discipline and rigor to Foundation activities, in order to promote greater effectiveness.

Overview

The [deleted] Foundation is currently managed by a full-time family member, and is looking to build a small, nimble team (2-3) that can help to better achieve the Foundation’s objectives. These include:
– investing in solutions to poverty and programs which empower young people from marginalized communities in the San Francisco Bay Area and around the world
– serving social entrepreneurs and other leaders through services which add value beyond the dollar
– engaging the philanthropic community to work in a more collaborative, informed, and effective manner
– inviting young people and every-day citizens to apply their talents and assets to improve the world around them
– building the field of social entrepreneurship, so as to promote a more developed marketplace of solutions for the world’s problems

FORGE Closes Funding Gap

December 30, 2008 – 10:33 am

Unbelievable.

Just two month from announcing the $100,000 funding gap that threatened to close down FORGE, exectutive director Kjerstin Erickson announces today that they’ve closed the gap and are ready to take on the rebuilding process in 2009.

Now, for the really good news – in the past month, donors have stepped forward to allow us to effectively close the funding gap for 2008. In a surprise turn of events, a foundation has generously offered to provide us with a $20,000 matching grant followed by a $30,000 administrative support grant in 2009. In response to the challenge, many of our past supporters rallied with second and even third large donations for the year. We had until February to raise the $20,000 matching, but we were actually able to cross the threshold today. The foundation has been very progressive and generous with its terms, and in the spirit of transparency even published its reasoning for offering the grant.

Of course, this story is far from over. 2009 is going to be an unpredictable year for us all. We can proudly say that we made it through the thick of 2008 and will be able to send more funds to continue our programs into 2009, but we’ll need to stay extremely cautious and diligent to ensure that we leave 2009 in a stronger position than 2008. That is what so many people have bet on when they decided to take a chance to invest in us in these risky times, and that is what we are committed to delivering.

My hat is off to Kjerstin and her unbelievable determination, the Tactical Philanthropy community for their role in all of this and FORGE’s existing supporters who dug deep when the broader community rallied to their side.

Wow!

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Foundation Transparency: FORGE Update

December 29, 2008 – 11:33 am

Over the past couple of months I’ve written a fair bit about FORGE, the nonprofit that embraced radical transparency. What I personally found most interesting about the whole saga was that a number of voices emerged resulting in an authentic conversation, not just a transparent admission of mistakes by FORGE. We had consultant Curtis Chang, FORGE executive director Kjerstin Erickson, myself, PR consultant Rich Polt and many, many people who added their voices via comments and/or emails that I posted.

One of the outcomes of all of this was a significant grant by an anonymous foundation that became aware of FORGE via the story playing out on this blog. As a step towards encouraging the “authentic conversation”, the foundation emailed me the following with permission to post it here:

Regarding FORGE: we’ve been lightly following the FORGE story unfold over the past couple of months and initially avoided jumping in (as you know) because FORGE appeared to be a sinking ship. However, while momentum seemed to be gaining, we decided to take interest. Deciding to fund FORGE was the result of an accumulation of things which, once put together, made it possible to meet Kjerstin personally and make a commitment the same day. Here’s a rough list of why we made this commitment:

1. Mission Alignment: obviously there had to be an alignment of interests, and part of our mission has to do with alleviating poverty. We seek to do so, in part, by funding new models which have promise and address problems in a way that others are not. While the relief that large aid organizations provide is necessary, I am yet to see an organization bold enough to try and build long term self-reliance for refugees…until now. A bit early to tell, but we’re willing to help FORGE prove they can do it.

2. The Person: it’s all about finding the people. Having heard many great things over time about Kjerstin from trusted sources, our initial confidence in her was strong. Given the nature of her work, and her approach during the past couple of months, she is no doubt a tremendously courageous human being…and quite crazy. Good crazy. We like that. Her decision to go “open kimono” on her blog was gutsy, smart, and demonstrated humble leadership; she went into survival mode and did something that most wouldn’t do. She’s smart for it and if she succeeds, this will be what saved FORGE.

3. “Radical” transparency: it is unfortunate that the kind of transparency exhibited by FORGE online is considered “radical”. This anomaly certainly isn’t just the fault of non-profits – I believe that funders share the responsibility to facilitate a transparent dialogue. Unfortunately, the aged process of proposals written to posted guidelines, impersonal paper-gathering and justifications to the board does not lend itself to true transparency. While some of it may be necessary, it has replaced face-to-face dialogue and really what should be a conversation between two equally-vested human beings, or organizations. In fact, her candid posts to me look more like “public” rather than “radical” transparency. Our grantees typically offer this kind of information. When a funder balances the power and becomes a partner, the truth comes out. When a funder expresses their support for someone’s work and the desire to fund what is needed most, the truth comes out. Recently we met with a woman who we really believe in and asked her, “what are you having the hardest time raising money for?” We made a significant two-year commitment to build her development team. (Pretty sexy, eh?) In our conversation with Kjerstin at her office, we also wanted to know, beyond the immediate fund-raising emergency, what her priorities were for 2009, which resulted in our additional commitment to fund an admin person to allow FORGE to address the wise recommendations of Curtis Chang and others. The conversation around the table provided a lot more information than a stack of audited financials.

We always try to keep our philanthropic antennas raised, seeking opportunities, while remaining flexible enough to make decisions when time is of the essence. This one is a bit of a risk, but we’re optimistic about FORGE’s future. Most people who get beat up but don’t give up, emerge with muscles and lessons learned.

I have to say how much I admire the thinking of this foundation. I had no contact with them prior to this exchange, but you can tell a lot about their thinking from this email.

Another Foundation Funds FORGE

December 12, 2008 – 10:44 am

The day after I laid out Why I’m Investing in FORGE, I received an email from an anonymous foundation asking me for additional commentary on my rationale. Today I was cc’d on this letter that they sent to FORGE. This is being reprinted with permission:

Dear Kjerstin, It was great to meet at your office today. Thank you for your time on such short notice.

Having considered the current challenges of FORGE as we’ve discussed today, the [deleted] Foundation is prepared to offer what we feel will help catalyze the kind of immediate funding you need, while also ensuring that FORGE can strengthen its work for the long-term. If you can raise another $20,000 between today and the end of February 2009, we will do two things: 1) we will match that with another $20,000 for core support, and 2) in addition, we will make a grant of $30,000 to be used for building internal capacity (as you described today) during 2009.

While this funding will help address FORGE’s immediate needs, the additional investment of $30,000 will be instrumental in 2009. As the current financial crisis is sure to affect non-profits significantly this coming year, it will be even more important for you and your staff to address the long-term sustainability of FORGE. This support for capacity will allow you to do just that.

I admire the work you are doing and the great sacrifices you and your team are making to do it. We hope this support will ultimately help FORGE to be successful in providing African refugees with the tools to lead and empower their communities.

This is a really well designed grant. It allows the foundation to not make the grant if FORGE is unable to raise enough to make this grant push them over the top to close their short term funding gap. It also begins to lay the groundwork for funding the restructuring of FORGE’s fundraising program next year.

This grant adds to the $27,000 already raised by FORGE as a direct result of their commitment to transparency. FORGE still needs to raise $20,000 to get this grant. If you want to help FORGE reach that goal, you can donate to them via this widget:

Why I’m Investing in FORGE

December 10, 2008 – 3:04 pm

Today I’m making an investment of $1,000 into FORGE (via the widget at the bottom of this post).

Over the last 6 weeks, we’ve seen the story of FORGE unfold. We’ve seen the Tactical Philanthropy Community engage with FORGE, not as cheerleaders for a cause, but as a group of people who care deeply about how philanthropy is practiced.

After reviewing the report prepared by Curtis Chang, I’m making my investment in FORGE for the following reasons:

I think believe that FORGE offers high impact programs and their current financial crisis is a function of identified, fixable problems with their fundraising model. I believe that FORGE is well on their way to closing their short term funding gap and I believe that they have the ability to restructure their fundraising model so as to create a sustainable organizational profile.
Like Bill Somerville, I believe that one key element of philanthropy is finding outstanding people and funding them. I believe that FORGE’s executive director Kjerstin Erickson is an outstanding person.
While I cannot predict FORGE’s future, the organization’s embrace of radical transparency makes me believe that I am aware of all knowable, material information regarding the organization.
Due to the organizations transparency, I also know that many other people have access to FORGE’s information and are able to come to their own conclusions. To date, I have not been made aware of any other person’s analysis of FORGE that has made me change my own view.
While the potential return on my investment is high (potentially saving an organization offering high impact programs), the risk is actually relatively low. At first, it seems that the failure of FORGE would result in zero social impact from my gift. However, I see two ways in which my investment can produce impact even in the face of FORGE’s potential failure, 1) I’m investing in Kjerstin Erickson, supporting her now will help her land at another organization should FORGE fail, 2) I’m supporting the broader concept of transparency in a way that I hope impacts the field (see next paragraph).

Finally, I am making this investment as a way to encourage other nonprofits to embrace transparency. A year and a half ago I wrote a post titled Demonstrating Impact: Philanthropy’s Urgent Call to Action. For a long time, the post was one of the most read posts I had ever written. In the post I wrote about a Council on Foundations conference session in which the value of transparency as a core value of philanthropy was made clear. In the post I wrote:

Humans don’t like to talk about their own “failures”. But halfway through the session, someone from the audience who identified herself as a professor of marketing stood up to say that people who admit their mistakes publicly are viewed with more trust afterwards. We need to reframe transparency away from some sort of thing that philanthropy is being forced to consider by outside forces and instead celebrate transparency as the mark of an organization that is truly committed to improving the field.

It is incredibly important that we build more trust within philanthropy. It is incredibly important that we move away from soliciting donations via a “sales pitch” and shift it towards a process of making a well reasoned argument centered on impact potential. FORGE hasn’t sugared coated things for us. They haven’t pushed pictures of the refugees they help at us. They’ve explained their situation, made a well reasoned argument for why they think they deserve funding and they’ve openly accepted any and all criticism with grace and humility.

FORGE gets my money.

FORGE Final Report

December 10, 2008 – 9:19 am

On October 21, I called the Forging Ahead blog “The Most Important Nonprofit Blog” because of the way that executive director Kjerstin Erickson was embracing radical transparency in response to their fundraising crisis. On November 3, the Tactical Philanthropy Community responded with a number of offers of assistance. The lead assistance came from Curtis Chang of Consulting Within Reach. At my request he agreed to offer FORGE pro bono consulting with the stipulation that he too would embrace radical transparency and both release his final report to the public as well as blog about the process on the Forging Ahead blog. (For more on “radical transparency” see “The See-Through CEO” which appeared in Wired Magazine in March of last year).

Through out all of this, FORGE has been working with the various members of the Tactical Philanthropy Community (including Rich Polt of PR firm Louder Than Words) to build a sustainable strategy. They’ve also already raised over half the money they need to close their budget shortfall.

Today, Curtis’s final report is being released. Both FORGE and Curtis hope that you will add your thoughts and comments. You can read an executive summary below the jump or you can click here to read the full report.

FORGE: Progress

November 24, 2008 – 8:33 am

FORGE’s consultant Curtis Chang has not yet released his strategic review of FORGE (remember, it has been only three weeks since I first put Curtis in touch with FORGE. A review done in less than three weeks would have been highly suspect in my mind). But FORGE has announced progress towards their fundraising goals:

Since announcing our budget shortfall, we’ve received $15,000 in new gifts (toward the $100,000 deficit). We’ve also received several pledges and committments that we are waiting to see formally materialize. Its been a good start.

In an exciting turn of events, a family foundation has come forward to offer $10,000 once we have raised $20,000 from our past donor base. So far, we’ve raised over $7000 of the required $20,000, and we are confident that we will raise the rest. Once this happens, we will be at least 40% of the way to closing the immediate gap that will allow FORGE to continue our work in 2009. It’s my belief that the first 40% is the hardest, as it is the early donors who must take the largest risk that we won’t make it.

There is still a long way to go. But we’ve got our nose to the grindstone, and we’ll keep plugging away…

I’m meeting with Curtis and Kjerstin today to get an update on the project. One thing I’m happy to know already is that the $10,000 foundation grant came about as a result of Kjerstin’s transparency efforts and the following surge in attention FORGE has received.

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FORGE: In Kjerstin’s Own Words

November 18, 2008 – 5:42 am

FORGE Goes “Mainstream”

November 17, 2008 – 12:16 am

When Kjerstin Erickson decided to start blogging about FORGE’s problems on the Social Edge website, her board discouraged her. It was actually a pretty dumb idea by traditional standards. But Kjerstin was actually doing something that to her generation (she’s 25) seems completely natural. She was living her life online.

I’m not of Kjerstin’s generation, I’m about half a generation ahead. But I’m close enough that when I read her very first blog post about her situation, I said that her blog “just became The Most Important Nonprofit Blog”. There was no doubt in my mind that Kjerstin had just embarked on an incredible journey.

I think that what Kjerstin is doing is important. Important in the kind of way that we’ll look back on in a couple years and cite her decision to go radically transparent as a precursor to the way the nonprofit field evolved. That might sound crazy, but I’m not alone. Today, the San Francisco Chronicle picked up the FORGE story. There are thousands of stories of struggling nonprofits right now. Meredith May at the SF Chronicle picked up Kjerstin’s story because of her decision to go transparent.

By Meredith May:

Like many social entrepreneurs caught in the economic crisis, Kjerstin Erickson is lying awake at night wondering if her tiny nonprofit is going to survive.

But in an unorthodox move, the 25-year-old decided to blog about her charity’s financial problems – despite warnings from board members that she’ll send her remaining donors fleeing…

…After Erickson began blogging last month on the Skoll Foundation’s Social Edge Web site, an interesting thing happened.

Her story went viral after it was picked up by the Tactical Philanthropy blog, and the social entrepreneur community took her on as an experiment in “radical transparency.”…

…Now, socially oriented financial analysts, nonprofit consultants and public relations firms offered to help her pro bono. Among them:

— Some top search engine marketers in New York have challenged themselves to raise $100,000 for FORGE in 100 days by coming up with innovative ways to direct more online traffic to the point-and-click giving on FORGE’s Web site.

— A family foundation in the Bay Area has offered to give FORGE $10,000 if it can raise $20,000 from its donor pool.

— Nonprofit consultant Curtis Chang has agreed to prepare a free sustainability plan for FORGE through his San Jose company, Consulting Within Reach…

…”The story of FORGE has yet to be told,” said Erickson, who is optimistic she will be able to turn things around.

“The goal of all of this is not just that FORGE recovers, but we come out a lot stronger because of it and learn the lessons we need to learn – and that everyone learns with us.”

You can read the whole story here.