Is the nonprofit model outdated?

Hi everyone, I'm having a virtual book launch event on February 25th at 10am Pacific Time. It's free, open to everyone, and auto-captions will be enabled. There will be giveaways, quick interviews with a few leaders featured in the book, and a reading by brilliant and hilarious drag artist Viper Fengz. Details and registration here.

This week is Valentine’s Day, truly one of the worst holidays ever. Single people feel like crap; partnered people feel pressured to make the day special. The only good thing about Valentine’s Day is the chocolates that will be on sale the day after, which I have set calendar reminders for. Love and romance, however, are important, so here’s a blog post I wrote a while ago with “12 Dating Tips for Nonprofit Professionals,” including Tip 4: Be the easel paper, not the sticky dots; aka, be the hummus, not the pita chips.

I’m thinking about love and relationships because there are parallels to our sector. Recently a colleague sent a message to ask me:

“Is the nonprofit model outdated? In an industry flush with passionate and hard-working professionals, clearly something isn’t working for us, and I just wonder if it’s structural. If it is, what comes next?”

This is a question that many of us ask ourselves from time to time. And who can blame us. The sector is rife with challenges: Lack of funding, poor compensation, few benefits, burnout, office rat problems, crappy chairs, annoying donors, horrible reimbursement rates from government, funders’ shenanigans, and so on.

I love our sector, AND I think it is easy to get into an unhealthy co-dependent relationship with it, where identities are merged, and we’re unable to set boundaries or see clearly and objectively.

I think a part of the problem is that we romanticize the sector too much. I’m still arguing with people, for instance, who are adamant that it is ok for nonprofit professionals to be asked to donate to the same organizations that employ them. I argue that this practice is gross and unethical, due to the power dynamics involved, and I get the push back that everyone should be “passionate” about their work and their organization, and if one is “passionate,” then why wouldn’t one want to help as much, and in every way, as possible?

The romanticizing is also done by funders, donors, board members, and the public, who insist that those who do this “noble” work should do so out of the goodness of their hearts, and thus should be OK with poor compensation, because the work itself is so intrinsically “rewarding.”   

So let’s remove some of the romance that’s been clouding our judgement. Is the nonprofit model outdated? Philosophically speaking, of course it is; it was outdated as soon as it was invented. We’re talking about a system that really shouldn’t even exist. In an ideal world, we wouldn’t need so many nonprofits or foundations, or even any. Billionaires wouldn’t exist. People would pay their fair share of their taxes. Government would be representative of its people and would take care of a lot of communal problems instead of just protecting the interests of the wealthy and powerful; neighbors would be taking care of one another.

But is this question even relevant right now? In a way, yeah; maybe this is the perfect time for us to think about reimagining what the sector could be. But I am leaning toward “Everything is on fire and we really need to focus on what’s important and be distracted by philosophical discussions and existential angsts.”

Last week, I talked about progressives’ fear and disdain of money and the handwringing that comes from our complicated relationship with it biting us in the ass, whereas conservatives just think of money as a tool, a means to an end.

The same goes for this question about the nonprofit model. While we fret about whether this model is outdated or ineffective or not, the right-wing has not worried about it. Most of the most effective right-wing organizations—Heritage Foundation, the NRA, Turning Point USA, Federalist Society, and thousands more—are all nonprofits.

And I doubt they’re spending time and energy thinking about whether the nonprofit model is outdated.

To them, nonprofit status is just a tool. It is not a silver bullet or panacea for the woes of the world. It’s a tool, kind of like an oven or a rolling pin.

Imagine there’s a cooking contest to see who can sell the most cookies they make to the most people. Both teams get access to the same tools, including ovens, stand mixers, blenders, and so on. One team has the vision and motivation to bake up some cookies, and they use every tool at their disposal. Sure, their cookies are bitter and nasty as hell, and they added rat poison after believing, against evidence, that it’s chocolate sprinkles. But they’re getting their cookies out there and convincing people these toxic treats are delicious and good for them.

The other team is having a planning retreat, where they try to agree on the perfect recipe and debate whether the oven is too old-fashioned to use. Someone on the team grabs all the flour and sugar, insisting the team should only use 5% of the ingredients because they don’t want to run out for future contests. Someone else brings up for discussion that maybe the entire kitchen is outdated and needs to be remodeled and that it’s hard to bake anything in such an outdated kitchen.

Guess which team has been winning, and feeding people rat-poison cookies?

The problem, it seems, is not the tools, but how people think about them and use them. The left-leaning wing of the sector is full of brilliant, talented people. But we’re stuck in this Dunning-Kruger paradox. Progressive cookies are by far the better cookies. If we can just focus and not get caught up in intellectualizing and risk avoidance and perfectionism-chasing, we can get a lot more done.

The nonprofit tax status is just a tool, a means, to get stuff done. Any like with most tools, it’s good for some things, and not so good for other things. We should learn to use all the tools, like mutual assistance associations, movements, LLCs, giving direct cash transfers to people, forming religious organizations, and so on. One time my oven wasn’t working (or more accurately just gross), so I used the air fryer. Was the ensuing lasagna the best? No. Was it pretty good? Yeah.

This is what right-wing movements have learned. They use all the tools they have instead of wasting time trying to find the perfect cookie recipe or fretting about the state of the kitchen. And if one tool doesn't work, or is prohibited from being used, they use something else. They get their cookies out there. We need to get ours out there too.

The cookies of equity.

Or something.

I’m hungry now.

I want a cookie.

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Vu’s new book is out. "Reimagining Nonprofits and Philanthropy: Unlocking the Full Potential of a Vital and Complex Sector." Order your copy through these links here. Net proceeds from the sales of the book will be donated to nonprofits supporting immigrant and trans rights.