July 24, 2003 | Read Time: 1 minute
A new survey of 72 nonprofit organizations that run 105 business ventures found that more than two-thirds of the ventures make a profit or break even.
Of the profitable ventures, 45 percent made money within their first year of operation, and 12 percent did so within two years. Another 12 percent reported that they were profitable within three years. Four percent said it took four years, and 14 percent said it took five.
Thirty-three of the 72 charities surveyed said they operate more than one business venture.
The survey was conducted by telephone last October by WB&A Market Research, in Crofton, Md. It was commissioned by Community Wealth Ventures, in Washington, a for-profit subsidiary of Share Our Strength, a national hunger organization. Community Wealth Ventures helps charities start businesses and companies design corporate-philanthropy programs that align with their business objectives. The study was financed by Atlantic Philanthropies and the David and Lucile Packard Foundation.
One third of the charities surveyed have annual budgets of less than $1-million; one third, $1-million to $5-million; and one third, more than $5-million. Thirty-three organizations operate locally, 27 regionally, and 11 nationally.
Community Wealth Ventures published the findings as part of a larger report, “Powering Social Change: Lessons on Community Wealth Generation for Nonprofit Sustainability.”
The report includes case studies of 10 nonprofit business ventures. Among them: a janitorial service run by Davis Memorial Goodwill Industries, in Washington; an Internet-consulting business operated by Homeboyz Interactive, a charity in Milwaukee that provides technology training to inner-city youths; and a timber-certification program run by the Rainforest Alliance, in New York.
The report is available free at http://www.communitywealth.org. Print copies are available for $12 each from Community Wealth Ventures, 733 15th Street, N.W., Suite 600, Washington, D.C. 20005; (202) 478-6570.
