Network Leaders and Experts Discuss the Need for Flexible Funding Amidst Financial Uncertainties and Challenges
Across the network, we are hearing the same challenges: executive leaders from member organizations are trying to diversify revenue streams, adapt to shifting macro environments like government funding uncertainty, and keep up with rising costs related to staffing retention and delivery of care. Lutheran Services in America is responding through a new strategy centering leadership and growth across our network, with a laser-focus on strengthening our network as a platform for scaling innovation in the health and human services field.
We kicked off last month with a peer learning session featuring Capitalize Good’s CEO and founder, Andrea Levere, who reminded leaders, “You have established yourselves as experts in tapping federal funding. Let’s look at ways to diversify that to other resources.”
The session, “Enterprise Capital Masterclass,” brought together executive leaders from finance, development, and operations, and focused on how to identify and leverage enterprise capital — multi-year, flexible funding invested directly into the net assets on the balance sheet — to better financially position organizations for long-term health and resilience amidst an evolving funding landscape.
Building on her session at The Summit this year, Andrea spoke of her partnerships with nonprofits to build organizational financial strength and resilience by leveraging different types of funding outside of the public sector — a crucial need and opportunity right now. Andrea recently highlighted this work for Stanford’s Social Innovation Review in “Nonprofits Need Enterprise Capital to Succeed,” sharing how enterprise capital builds net assets, enabling nonprofits to make investments in revenue-generation strategies and maintain resources to mitigate cash flow mismatches.
Below are three major insights from the session, which included dynamic small team break-outs to understand how to re-evaluate financial statements to optimize capital structures and identify matching funding sources to achieve bold goals.
Why enterprise capital is critical now for organizational health:
- Match capital to purpose. Enterprise capital acts as flexible, long-term funding that can attract additional debt or new funders, unlike one-year restricted grants, which aren’t built for long-term mission goals. Organizations need to be intentional about matching funding type to what they’re actually trying to accomplish.
- Unrestricted assets fund the wiring that keeps the lights on. Staffing retention, wages, and aging infrastructure maintenance are often an organization’s largest expenses, and unrestricted net assets are what make it possible to cover them as well as invest in product or service innovation and growth.
- Ask funders directly, and ask for more than money. Leaders should proactively name their risks and challenges to funders, and ask for both financial and non-financial support, not just grant dollars. “Ask for what you need, not what you think you can get.”
Moving forward, Lutheran Services in America will be creating more opportunities for c-suite leaders to collaborate and share insights on organizational sustainability and growth
If you are interested in learning more about enterprise capital, Andrea Levere is available to explore how this work connects to your organization and you can email her directly at andrea@capitalizegood.org.
If you are a finance professional looking to connect with your peers at Lutheran Services in America, learn more about our Lutheran Financial Managers Association (LFMA) peer network and their upcoming conference, October 13–15 in Nashville!