Strategies to Diversify Funding Sources in Nonprofit Organizations
Abstract
Although nonprofit organization (NPO) leaders play crucial roles in society, financial
distress and vulnerability are common for many NPO leaders, with some NPOs closing as
a result of these conditions. The purpose of this single-case study was to explore the
diversification strategies used by 10 leaders and senior staff of an NPO in the midAtlantic region of the United States through the conceptual lens of Markowitz’s modern
portfolio theory. Data were collected through in-depth semistructured interviews and
analysis of organizational documents, internal archival data, social media, literature, and
online databases. Through thematic analysis, 7 revenue diversification themes emerged:
adding revenue streams; establishing an operating reserve; establishing positive financial
performance; achieving financial stability, sustainability, organizational capacity, and
organizational resilience; using transparency; achieving efficiency and organizational
effectiveness; and using a marketing strategy. Additionally, 7 key themes emerged:
documenting and implementing systematic processes, developing an approach to process
improvement, implementing cross-department action plans, increasing transparency,
reversing the adverse trend in forum participation, building a data-management system,
and increasing individual and organizational capacity. These findings have implications
for positive social change, in that they may offer NPO executives new insights and
strategies to support revenue diversification, thereby helping them to reduce volatility in
funding, decrease financial risk, avoid dependence on sole-source revenue, and identify
opportunities to increase flexibility in support of organizational goals and objectives to
increase services.
Description
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Article
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Keywords
non-profit, nonprofit, diversification strategies, research, funding
Citation
Gunnerson, A. L. (2019). Strategies to Diversify Funding Sources in Nonprofit Organizations. Walden Dissertations and Doctoral Studies.