Increasing the Capacity of Individuals, Families and Communities

Revenue Sources

Step 1 Assess Your Goals and Financial Resource Capacity | Step 3 Homework on Federal Cost Sharing Regulations

STEP 2 Clarify Your Income Strategy

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Too often, organizations spend precious time and money because they fail to select a strategy. Some pursue more revenue by starting up one or more income sources before asking if this is helpful or necessary. Others painfully pursue re-working their existing revenue generating ability instead of investing that same time and energy in building something new. And some organizations, wary of developing an alliance or strategic relationship, never consider the possibility of mutual gain by lending, using or borrowing another organization’s financial resources. An income strategy answers three questions:

• Do I build on an existing revenue source?
• Do I need to start something new?
• Can I “borrow or use” a revenue source from someone else?

Step 2 in the ACHIEVE process lets you select a strategy to generate revenue. Unless you have the assets of a parent organization, most intermediaries use one of four income strategies:

• Enhance an existing revenue source
• Start a new revenue source
• Form an alliance or partnership with an organization to “use“ their revenue sources
• Form an alliance or partnership with an organization that brings in-kind resources to the relationship

Enhance an existing revenue source by applying resources of money, counsel and time to improve upon one or more revenue sources that already exist within your revenue generating portfolio. If you have direct mail, you might add a new program to further sort your file of donor names to get a higher yield from certain portions of the file. If you have a grants program to foundations, you might add staff or a consultant to bolster research, inquiries or follow-up on turndowns. CCF intermediary organizations like Operation Blessing and Clemson University build on what they have.

Start a new revenue source by applying people, money and expertise to initiating and sustaining a new source of income. An organization might start a major gifts or planned giving program, create an institutionally-related foundation or start an endowment or create a sister corporation to launch a business. All of these would be incremental to existing revenue efforts and require incremental resources to get started.

Use another organization’s monetary source by entering into an agreement to provide a mutual benefit to both entities. CCF intermediaries like the University of Hawaii, United Way of Massachusetts Bay and Institute for Youth Development created alliances with other organizations and individuals to create a mutual gain by joining distinct resources toward a common goal. For more information, see the Establishing Partnerships guidebook, part of the National Resource Center’s Intermediary Development Series.

Use another organization’s in-kind services by entering into an agreement whereby the value of time and services, materials, space or other in-kind contributions meets a cost share. Several CCF intermediaries such as JVA Consulting LLC and Northside Ministerial Alliance (NMA) created alliances with other organizations and met their matching requirements through in-kind contributions and, in NMA’s case, resulted in some fundraising, too.

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Step 1 Assess Your Goals and Financial Resource Capacity | Step 3 Homework on Federal Cost Sharing Regulations