have you ever thought of doing a merger?

Good Reasons for Nonprofit Mergers

A nonprofit I have done consultant work for recently merged with a smaller organization and it did not go well. It inherited two employees, and one of them raised a stink and took it to the media. They had to fire her, amid a storm of unpleasantness. For the record: I was not involved.

But I will say this. There are good reasons to do nonprofit mergers, and this situation met two of them. Those were: 

1.         To allow a struggling or declining organization to keep its mission alive by merging with a stronger, stabler one.

2.         To allow an effective nonprofit to expand its geographic footprint by merging with a neighboring organization.

Other good reasons for mergers:

3.         To join complimentary strengths, capabilities, or assets. Maybe a younger nonprofit has strong expertise but inadequate or expensive facilities. Maybe an older nonprofit is less up-to-date on expertise but has ample, paid-for property.

4.         To help the mission of an organization carry on after the retirement of a founder. Some flounder post-founder, if they lack a good successor.

5.         To eliminate the inefficiencies of back-office (and other) duplication of parallel, similar nonprofits.

5.         Simply put, sometimes 2+2 can equal 5. To increase impact.

So there are good reasons to consider mergers, but there are ways to do it smart and ways to do it dumb. That’s another little newsletter.

love, joy, peace … Michael

www.michaeljaffarian.com. Michael is a freelance consultant to nonprofits, with an emphasis on research. Contact him for a free, one-hour consultation. emichaeljaffarian@gmail.com.

Vol. 1 No. 16