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O.C. nonprofits, continued ...Published: October 01, 2011

Despite the soaring demand and the need for services, there are signs that three years after the Wall Street meltdown, Orange County’s nonprofit community has come to grips with the “new norm.” Donors and nonprofit operators alike say there is an honesty and urgency to their actions that portend good things for the county’s ability in the long term to take better care of its homeless, disenfranchised and unemployed.

From “donor” to “investor”
Donors are still giving, though more selectively and not as much. They are asking more questions about what they are contributing to, whether it’s cash or in-kind goods and services. The Google age has changed the giving game, and donors now know more about a nonprofit then ever before. Because of the Internet and social media, prospective donors often have made up their minds before they are even asked to give or volunteer. Donors today also want a different return for their “investment.” Particularly younger donors, regardless of the amount of their contributions, want assurances that their giving will make a qualitative difference in the lives of the end recipients.
“It’s not about how many syringes will my donation buy, but whether that medicine will truly improve the health and happiness of that individual or targeted population,” says Freeman, senior managing director of First Foundation Advisors. “That’s what donors are increasingly asking for. They want a stake in the outcome; they view themselves as more than just donors. They see themselves as change agents.”
Daniel McQuaid, CEO and president of OneOC, a major umbrella organization training, assisting and connecting individual nonprofit agencies in Orange County, agrees: “The most significant phenomenon is donor savviness. Donors are asking more specific, often tough, questions. ‘Giving’ is moving much more toward ‘investing.’”

The changing “business” model
Nonprofits are scrambling to adapt. Taking a page from the for-profit playbook, nonprofit executives and boards have dramatically overhauled their vocabulary and business models. Listen, and you hear words such as “efficiency,” “consolidation,” “collaboration,” “mission focus” and “priority setting.” And nonprofit chiefs have added new ones like “return on investment,” “social media” and “relationship reconstruction.” These concepts are not new. But many nonprofits acknowledge that they have not always embraced or been faithful to these strategies as road maps to grow and sustain their organizations. In the face of today’s economic turbulence, many have no choice but to change operations.
Shelley Hoss, a 24-year veteran of non-profit work, believes growing numbers of Orange County nonprofits “get it” and should be applauded for rising to the challenge.
“Our local nonprofit community has responded with such resilience and intellect to the extraordinary challenges of the last three years that we should be standing and cheering every time they walk into the room,” says Hoss, whose foundation oversees more than $29 million in annual private contributions. “Nonprofits took this challenge very personally. In many ways, they are stronger already.”
The hard look into the mirror, as donations were frozen or evaporated altogether in the deepening recession, changed behavior among nonprofits large and small. Irvine-based Human Options laid off nearly 14 percent of its staff, a move that reduced some programs but financially stabilized the 30-year-old domestic violence agency. In Costa Mesa, Share Our Selves (SOS) took over a similar, but smaller group to streamline and strengthen its delivery of “safety net” services to poor and low-income clients.     

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10 Questions for Max Gardner
President & CEO, United Way Orange County