John C Daley wrote:Thank you for your information.
One of the things I do not understand about NFP outfits is how many similar one there are.
In Australia, the laws were changed to ensure NFP organisations do you spend too much of the cash flow on wages and salary.
Not because they dont have much income, but because they often have large incomes!
Sonce your website is not available, what ate the breakdown of tour groups income and expeenditures please?
Hi John,
Thanks for taking a look at what we're doing, it means a lot! Hopefully you found the attached slide deck which covers the majority of what you will find on our website when it goes live next week.
I (and every other nonprofit leader) get this question regularly, and it typically comes from a member of the younger generation who lacks an understanding of how businesses works. So, forgive me if that doesn't describe yourself, but considering this describes the average person asking this question, I will answer it as though I am speaking to someone who fits that description. Because, for starters, anyone who has a foundational understanding of the nonprofit industry knows you can visit the IRS website and pull the financials for any nonprofit in the United States and answer this question on your own.
Please don't misinterpret my tone, everything I say is full of love, compassion, understanding and a deep and genuine desire to educate folks about the realities of running any business, but more importantly a 501(c)3 nonprofit, such as ours. I say this as a person who has worked in high-level, middle-management roles with large Fortune 500 companies, I also have three LLC's of my own in addition to this 501(c)3 of which I am both the Founder and President.
The short answer to your question is "100%", one hundred percent of the donations we receive go directly toward our mission. However, the short answer is not fair, and does not do justice to the "Big Boys" out there, we will use the ASPCA as our example of a Big Boy for the sake of this discussion. They are among the biggest, very widely known, and it's very likely that everyone is familiar with their mission and how they enact on their mission. The short answer is also unjust and unfair for us too, because my deepest hope is that we will continue to grow, and with growth comes expenses that the average person has difficulty connecting with the mission.
With that in mind, I will begin by saying; this question demonstrates a lack of understanding of the business side because what ends up happening is, regardless of the answer, whether it is 100% - such as in our case - or the answer is 76% - as it is with the ASPCA - what ends up happening is people who have little or no connection to the organization or the industry begin applying their own code of morals and ethics toward determining what is an acceptable answer, without a deep understanding of the unique challenges each individual organization is forced to over come in order to enact upon their mission, or just frankly to keep the lights on. Furthermore, not only do they typically lack business acumen, they also generally have no intention of doing it themselves, or doing it better. Some organizations have the best of intentions and do brilliant work for the people they serve, but just have weak business leaders who aren't great at managing finances. That doesn't make them bad, it's almost always just a case of someone who has a huge heart and little education or experience in running a business. However, when you hear a response like 76%, or even worse I know some which are less than 30%, a person who doesn't understand what it takes to run a business immediately assumes the worst and suspects the ugliest forms of misappropriation of funds must be happening behind the scenes. 99% of the time that is just not the case. Especially in the U.S. every nonprofit goes through a rigorous verification process and has no choice but to remain 100% transparent with its financials otherwise your 501(c)3 status can be and will be revoked quicker than you could cash a check! :D
Regardless of the answer, there is no official measuring stick and there shouldn't be, so if the Australian government has chosen to try and regulate what they feel is an appropriate answer, I - and I believe the vast majority, if not all, of my peers would agree - is an egregious example for government over-reach and just makes me more proud to live in and do business in the United States. In my opinion, the U.S. model in dealing with 501(c)3's is incredible. Rather than "governing" what they feel is an appropriate amount of spending on certain things, they require every 501(c)3 to essentially be publicly owned, and to report and make their financials public information in order to allow the individual donor to make that determination and to decide whether or not they want to support a particular organization.
Now, whether you are asking because you're considering supporting our mission, are just curious, or are some kind of self-appointed NFP Police Force (I say that in a very joking and tongue and cheek fashion! :D), the world may never know! But, regardless of your reason, I appreciate your question, because it is one that we get a lot. I take a lot pride in being able to say we have no paid employees, we don't spend money on advertising, and all of our donations go directly to our charity mission, however, someday I hope that the answer is no longer 100%, someday I hope we get to a point that we cannot survive without paid employees, someday I hope we can afford to have an advertising and marketing budget. Now, a member of the NFP Police Force may see those expenditures as "non-mission-specific" spending, as you mentioned "salaries and wages". However, I would argue that salaries and wages are mission-specific and mission essential. For example, I would love to have a full-time, salaried therapist on staff for our kids and veterans to access free of charge, 24/7, 365; that would fall in the category of "salaries and wages" which a member of the NFP Police would point out as non-charity-specific spending, however, me knowing that within the salaries and wages part of our budget is our full-time therapist, I know that person's salary is "charity-specific". So you can see how this becomes a slippery discussion.
The reality of doing business in a capitalist society is that an organization cannot survive on volunteers alone. Every organization at some point will need a staff of full-time employees, and a person who can afford to volunteer 40-50 hours a week, has a necessary and in-demand skillset, and will still be able to pay their rent is extremely rare. I am blessed with having a retirement pension that covers my living expenses, so for as long as I can handle running the operational side of our business on my own, then we can get by without paying employees. I, however, would argue that employee wages and advertising are mission-critical, if not "mission-specific".
With all that said, I caution you and any other person who would ask this question to look inside yourselves and ask why you are asking this question, what answer do you believe to be an acceptable answer, and if you find the answer unacceptable according to your own morals and ethics, are you willing to start your own 501(c)3 and replace the work of the organization that you feel is not doing business up to your standards?
If you can't answer the last question with a hard "Yes!", then do everyone a favor and support the organization as they work to improve the lives of others, or silently judge from afar. Because, even if an organization spends less than 30% of the money they receive on their actual charity, at least they are out doing SOMETHING to make the world a better place for others, while the NFP Police Force sits in their arm chairs criticizing them for not "helping others good enough"... doesn't that sound silly LOL? At the end of the day, at least they are out helping others.
I hope I haven't offended you in any way, again everything I've shared is filled with love and a genuine desire to help you understand that regardless of how much of every dollar that is donated to an organization goes to "charity-specific" expenditures, there is no universal "right or wrong" and the best thing we can do as individuals is find one organization who has a mission that connects to our heart and our soul and just pour everything you can into that organization without judgement, because I have yet to meet a leader in the nonprofit space who doesn't have an absolute heart of gold for their mission and the people they serve, and none of us ever receive all the help we need.
If you'd like to connect directly and chat in more detail, please feel free to reach out directly via my email and I'd be happy to schedule a video or voice call with you anytime, John! :D
HuntPrayEat@gmail.com
Also, if you're happy with the fact that we are able to spend 100% of our donations on serving our kids and veterans, and you find that you have a heart for our mission, please considering showing your support. Below is the link to our GoFundMe, and once the website is live you will have to ability to sign up to become a monthly supporter.
https://www.gofundme.com/f/children-and-veterans-of-the-carolinas?utm_medium=copy_link_all&utm_source=customer&utm_campaign=p_cp%2Bshare-sheet
I hope to hear from you soon!