What nonprofits should consider before merging

September 14, 2020

Four Considerations When Merging Your Nonprofit

Melissa M. Cameron | Senior Counsel – CSR & Philanthropic Services

2020 has proven itself to be a challenging year for everyone, yet nonprofit organizations have been hit harder than most. With less fundraising dollars available and needs being greater than ever, leaders must make some tough decisions. One consideration may be merging your nonprofit with another nonprofit organization.

Collaborations, mergers, partnerships & acquisitions  – what’s right for you?

“Collaboration” has been a buzzword in the industry for years. Many nonprofits have thought about a merger before, but COVID-19 has pushed non-profit leaders into serious discussions on the topic.

 For some organizations, the only goal at hand for the last few months has been survival. While leaders have already cut costs and personnel, that may not be enough to ensure they are around when the crisis is over.

Enter mergers, acquisitions and other creative collaborations and partnerships. Tactics like merging `back office’ functions or partnering on service delivery may lead to interesting organizational combinations. While merging your nonprofit may seem like a simple solution, the process can be incredibly complicated.

Four Considerations to Make

As a nonprofit leader or board member, here are four things to consider when discussing merging your nonprofit:

  1. Be clear about your organization’s mission and vision prior to beginning talks of a partnership. Make sure you know who you are and what is important before joining another organization that may have different values.
  2. If you think merging your nonprofit is necessary, write a business case that clearly identifies how the organizational partnership addresses the mission of the new or combined organizations.
  3. Be careful of your own preconceived notions! Crafting these kinds of organizational relationships is like dating and then marriage  – there will be good and bad times, there will be arguments and differences of opinion. Take them all in stride!
  4. Make sure all your stakeholders  – donors, employees, leadership, volunteers, boards  – are advocates of merging your nonprofit. If they are not behind the partnership, it is going to be tough gaining momentum and excitement for it.