3 Reasons For Merging Your Nonprofit

Have you ever thought of merging your nonprofit? If not, it’s something you should consider. However, before we get to that, let’s look back a bit before moving forward. As I wrote in my book in the chapter on nonprofit mergers, on October 19, 1987, I entered the nonprofit field from a thriving career as a lawyer.

I didn’t know much about the sector then. Still, I enthusiastically gave it my all as a member of the Advancement Team at the University of Notre Dame to raise $350,000,000 for its major capital campaigns. Since then, Black Monday, by the way, I realize we need to shake things up, and perhaps even you should consider merging your nonprofit.

The Nonprofit Sector: Then and Now

The year I started working in the nonprofit sector, in 1987, approximately 400,000 nonprofits existed. Now we have more than 1.5 million. While that may seem significant, unfortunately, the vast majority of them are small operations. In other words, they have small budgets in the $500,000 or below range, and as a result, their impact tends to be minor, especially the groups operating with less than $100,000.

Unfortunately, the demands of the digital era, social change, and increased competition from businesses and impact investment groups mean that if you want to grow beyond just being a small-time operator, you should consider merging your nonprofit. Let’s explore three of the reasons to do it.

3 reasons to Merge Your Nonprofit with Another

For many nonprofits, acquiring new donors is challenging. You can’t simply rely on the old marketing technique of word-of-mouth or small Facebook ads to market your nonprofit. To grow your organization and make a scalable impact, you need to invest and spend money. Aside from a major donor making that investment, the only other solution is to merge with another nonprofit with cash in the bank.

Merging with another nonprofit can also help you grow your organization, especially when the smaller nonprofit doesn’t have enough capital. When you combine with another nonprofit, you also gain a new perspective, leading to new ideas and ways of doing things that may not have been possible earlier. In other words, you have the chance not to duplicate skills and merge resources for more scalability.

1. Merging for Capital

Merging with another nonprofit for capital can be a lifesaver. It can help you maintain your organization and grow. If you’re a nonprofit founder, combining with another organization for capital is an immense opportunity and shouldn’t be viewed as a necessary evil. By merging, you have the chance to increase the likelihood that you achieve the vision you always wanted.

The reality is you may not have enough money to market or invest in new programs properly. However, if you merge with a nonprofit with the funds, you acquire those funds and expand your work. All of the combined resources (e.g., money, people, programs) could truly place your nonprofit on the map in your community.

2. Merging Your Nonprofit for Growth

While this point is the most obvious of the three, it’s also the most important. As you know, growth equals success. So if your nonprofit doesn’t have enough resources to expand, merging with another organization could be beneficial. Perhaps you’d love to add another program but can’t. Or maybe you want to provide services to more people.

Inevitably, merging brings growth. By merging with another nonprofit, you’ll not only get new ideas and different perspectives but often new skills as well. For example, you’ll get the thinking of new people for new program development. Or, perhaps you need strength in marketing and technology, and the other nonprofit brings that knowledge to the table.

3. Merging for Experience

Merging with another nonprofit can be a huge help when you need to broaden your experience in a different area. For example, let’s say you lead an organization for youth services. However, you realize that you need to get other robust ‘wrap-around’ services to support youth. You might not have the experience to implement those services, but another nonprofit does, making sense for merging your nonprofit.

As we know, we live in very fast times. It’s essential to keep your mind open to new ideas and try new things. People and communities bear an immense amount of stress due to massive uncertainty. Therefore, you could offer more significant support by merging with an experienced and aligned organization. In doing so, combining two organizations brings you new perspectives, resources, and growth.

In sum, merging your nonprofit has some desirable benefits if you think about it. If you want to grow and be more successful or enjoy some of the benefits of a larger organization, it might be worth considering.

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