Jani’s Journal Issue 40: Collab & Conquer to Outsmart Funding Challenges
2/18/2025
Freeze-proofing Your Nonprofit
In case you’ve been on a deserted island, funding cuts and freezes may be on the horizon for many nonprofits whether they receive Federal funding or not. While the recent Federal funding freeze was rescinded, many nonprofits are still panicked at the prospect of their reinstatement, and with good reason. In times of economic uncertainty, it’s tempting for nonprofits to tighten their belts, go into survival mode, and “divide and conquer.”
But this is precisely the time strategic partnerships and collaboration, rather than hunkering down, can be the key to financial resilience. Instead of going it alone, nonprofits that collaborate with peer organizations, leverage shared resources, and pursue joint funding opportunities or expense-sharing arrangements are better positioned to weather financial storms. This issue of Jani’s Journal explores proactive strategies to funding freeze-proof your nonprofit, from coalition building to innovative revenue models, helping you not just survive, but thrive despite economic uncertainty. Collaborate and conquer!
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Jani’s Jackpot!
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🔗 Eight Steps for Managing Through Tough Times 🔗
This Bridgespan article originally from 2008 and revised for 2019 is a great reminder that we’ve weathered this storm before, and we can do it again. Nonprofits inevitably face financial challenges, whether from economic downturns, sector-wide shifts, or funding losses. While tough times demand hard decisions, strategic action can help organizations adapt, protect core services, and strengthen long-term sustainability. Eight key steps outlined by Bridgespan:
Act quickly but plan for contingencies by establishing financial tripwires for which to monitor and scenario plans to guide decision-making.
Protect the core by prioritizing high-impact programs and allocating resources where they matter most.
Identify and retain essential staff and leaders, ensuring diverse perspectives in decision-making.
Stay close to funders by proactively communicating with key donors and funding partners to secure continued support.
Improve organizational efficiency by streamlining decision-making, optimizing operations, and exploring cost-saving measures.
Collaborate for cost savings and impact by partnering with other organizations to share services, consolidate purchasing, or explore mergers.
Engage the board by leveraging board members' expertise, fundraising capacity, and operational support.
Communicate openly and often to keep staff, funders, and stakeholders informed to maintain trust and morale.
Building Collaborative Partnerships
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🔗 Creating High-Impact Coalitions 🔗
This Harvard Business Review article speaking to corporate coalition building offers some great takeaways for nonprofits looking beyond traditional funding models and exploring high-impact coalitions—cross-sector partnerships that unite businesses, government agencies, and fellow nonprofits to tackle systemic challenges. In today’s landscape, where funders and stakeholders expect organizations to collaborate for greater impact, these coalitions offer nonprofits a strategic way to expand resources, enhance credibility, and drive long-term financial stability. By aligning around a shared mission, nonprofits can secure funding, build capacity, and strengthen community trust in ways that would be difficult to achieve alone. Five key organizational principles of coalition building include:
Exercise Moral Leadership: Successful coalitions form around a shared, mission-driven purpose that transcends any single organization’s goals. Strong leadership rooted in collaboration, humility, and a commitment to systemic change builds momentum and credibility.
Operate at the Speed of Trust: Unlike formal partnerships with rigid structures, high-impact coalitions rely on relationships, transparency, and open participation to align stakeholders quickly and foster collective action.
Find a Balance of Commitments: Members contribute according to their capacity, maintaining flexibility in participation while staying aligned on key priorities. Nonprofits must set clear expectations for engagement without overextending resources.
Navigate Competing Coalitions: Many nonprofits juggle multiple collaborations—coalition leaders must align efforts, avoid duplication, and ensure partnerships complement rather than compete for funding and influence.
Focus on Solutions: The coalition’s success depends on achieving measurable, tangible results rather than just forming alliances. Nonprofits should center their participation around actionable goals that drive impact and financial sustainability.
🔗 Four Questions for Appraising Your Alliances 🔗
This MIT Sloan Review article reminds us that just like international and corporate alliances, nonprofit partnerships should never be assumed to be permanent or inherently beneficial. Strategic collaborations can amplify impact, expand resources, and strengthen financial stability—but only if they remain aligned with an organization’s mission and capacity. As the external environment shifts, nonprofits must regularly reassess their alliances to ensure they contribute meaningfully, remain stable, and align with shared goals. By applying a structured evaluation process, nonprofit leaders can identify partnerships that strengthen resilience while avoiding (or “pruning”) those that may introduce risk or inefficiency. Key questions for evaluating your partnerships:
Does your partner make a meaningful contribution? A good partner actively adds value through funding, expertise, advocacy, or capacity-building—not just in name or intent. If promised contributions don’t materialize, the alliance may not be worth maintaining.
Is your partner stable? A financially or strategically vulnerable partner can become a liability. If an organization is at risk of closure, losing key funders, or facing public trust issues, it may negatively impact your nonprofit.
Are your partner’s interests still aligned with yours? Over time, priorities shift. A partner that once shared your mission may now be competing for the same donors, serving a different audience, or redirecting efforts in a way that creates conflicts.
How well is your partner treating your nonprofit? Mutual respect, transparency, and trust are the foundation of a strong partnership. If your nonprofit is being undermined, taken advantage of, or excluded from key decisions, it’s time to reassess.
🔗 Are Collaborations or Mergers in Your Nonprofit’s Future? 🔗
This article from the ERA Group, an international expense reduction consultancy, rightly identifies that nonprofit mergers often bring uncertainty and emotional resistance, but they can also be powerful tools for financial sustainability, operational efficiency, and expanded impact. Nonprofits with overlapping or adjacent missions frequently compete for the same limited resources rather than combining their efforts. By strategically combining resources, nonprofits can leverage respective strengths, streamline operations, and improve financial viability—ensuring long-term mission success even in challenging funding climates. However, to unlock the full potential of a merger once mission alignment is established, organizations must proactively assess their combined assets, supplier relationships, and procurement strategies to maximize cost savings and efficiency. Key considerations for navigating a nonprofit merger (or formal partnership):
Align resources & stakeholders by conducting a thorough assessment of combined resources to identify opportunities for cost savings and operational efficiencies. Be sure to keep staff and board members engaged and informed to minimize uncertainty and resistance.
Streamline supplier & purchasing processes by reviewing existing vendor relationships to eliminate redundancies and negotiate better terms. Be sure to objectively assess supplier contributions, long-term value, and mission alignment.
Leverage scale for cost savings by renegotiating contracts based on the new organization’s increased purchasing power. Consider bidding out vendor agreements to foster competitive pricing and improved service terms.
Monitor financial performance & efficiency by regularly reviewing contracts and invoices to prevent cost creep and identify pricing discrepancies. Train staff on best practices in procurement and financial oversight to ensure compliance with cost-saving initiatives.
Seek third-party support by engaging external experts to uncover inefficiencies and facilitate a neutral, mission-driven decision-making process. Address emotional ties to legacy processes with data-driven insights and structured change management.
Revenue & Expense Management
🔗 Four Ways to Make Your Donor Relations Recession-Proof 🔗
This Chronicle of Philanthropy article focused on recession-proofing offers useful strategies during any period of financial uncertainty. With uncertain grants and contracts, nonprofits can consider shoring up their philanthropic support. The Chronicle of Philanthropy identifies four key strategies to strengthen donor relationships and maintain financial stability:
Survey and segment donors to understand their motivations and engagement history and create personalized outreach and invitations in tailored communications acknowledging past support.
Expand donor recognition beyond contributions by establishing donor clubs based on long-term engagement (e.g., multi-year gala attendees), publicly recognizing volunteers, fundraisers, and donors through social media, events, and newsletters, as well as separating thank-you messages from solicitations to enhance donor appreciation.
Enhance storytelling to deepen engagement by using compelling narratives with characters, conflict, and resolution to illustrate the impact of donations. Consistently showcase real stories of beneficiaries, volunteers, and donors to build trust and reinforce mission relevance.
Create sustainable growth strategies by optimizing fundraising technology to maximize donor engagement and reduce inefficiencies. Establish a monthly giving program to improve donor retention and lifetime value and expand fundraising efforts through board-led events, virtual activities, and creative engagement campaigns.
🔗 Ten Cost-Saving Strategies Every Nonprofit Should Implement Today 🔗
Nonprofits operate with tight budgets to begin with. This article by UST, a nonprofit workforce consultancy, identifies ten actionable strategies to help nonprofits optimize spending and redirect savings toward core programs and services. In times of belt-tightening, nonprofits can reconsider the following strategies:
Streamline operations through Technology by automating tasks to reduce labor costs and increase efficiency.
Harness the power of volunteers by engaging and managing volunteers strategically to offset personnel expenses.
Go green to save green by reducing waste, energy consumption, and paper use to lower operational costs. Shifting to a paperless operation pushes organizations to leverage technology thus building efficiency.
Opt for second-hand equipment by purchasing gently used office furniture, tech, and supplies at a fraction of the cost.
Leverage free or discounted services by taking advantage of nonprofit discounts on software, marketing tools, and training.
Invest in staff development to improve retention and efficiency through training programs that reduce long-term costs.
Collaborate with other organizations to share resources, apply for joint grants, and co-host events to cut costs. See above “Building Collaborative Partnerships” section!
Conduct regular financial reviews. Regularly scheduled internal financial and best practice audits identify inefficiencies before they become entrenched.
Optimize fundraising practices by using data-driven insights to reduce acquisition costs and increase donor engagement.
Reevaluate space needs by downsizing office space, renegotiating leases, or implementing remote work options.
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