Few For-Profit Ventures Run by Charities Succeed, Says Report

Charities that start for-profit ventures to support their nonprofit efforts run the risk of becoming distracted from their social missions, says a new report summarized by The Wall Street Journal.

The report from the Seedco Policy Center, a research branch of a New York nonprofit group called Seedco, explains that cuts in government aid have led many charities to embrace side businesses in the past two decades.

But while Seedco applauds most groups’ desire to be more financially independent, the report says that few for-profit ventures actually make profits.

Seedco, which supports low-income workers and small-business ventures, itself shuttered an emergency commercial child-care operation in 2003 after just two years, giving it first-hand knowledge of the complexities of blending business and charity.

Read The Chronicle’s recent package on nonprofit groups that run side businesses.

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