Funders can Leverage for Nonprofit Collaboration

Posted on May 25, 2011 by Pam Truitt

Last week, I kicked-off reflections from our time in April with Lois Savage, President of The Lodestar Foundation in Phoenix.

The Patterson Foundation was extraordinarily fortunate that Lois was going to be in Florida and she was gracious when we asked if we could leverage her time. During conversations with some of Sarasota’s community leaders, Lois provided insightful thoughts from Lodestar’s 12 years of experience in nonprofit collaboration. I could expend thousands of keystrokes and wax eloquence on her wisdom, but I want to advance the conversation by talking about how Lodestar has used leverage in nonprofit collaborations.

The Wellness Communities and Gilda’s Club Merger in 2009, led to what is now called the Cancer Support Community. During the merger negotiations, a debt owed by one of the parties turned into a stumbling block. Lodestar stepped in and paid the debt, leveraging the integration and enabled the merged organizations to save about $1.3 million in operations in the first year. According to Lois Savage, “The merger would not have taken place but for payment of the debt.

An Arizona-based nonprofit—Women Living Free—had established a successful model of working with women during transition between prison release and being free. This period is critical to prepare women for life after prison to reduce the recidivism rate. The two inspired women who started Women Living Free knew they could not grow to the scale necessary to attract major funding. So, they found a larger nonprofit—Arizona Education and Employment (AWEE) — and negotiated an agreement that allowed AWEE to acquire the prison program. Lodestar provided the leverage by agreeing to pay the costs ($11,000) to dissolve Women Living Free. The result? AWEE was successful in receiving a $4 million federal grant to grow Women Living Free’s program.

Do you know of examples of philanthropic leverage for nonprofit partnerships? Share them with us in the comments section below.


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