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Road map for FORGE
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This is an executive summary of a fuller report outlining the steps FORGE needs to take to pursue long term sustainability.
This entry is from Curtis Chang, CEO of Consulting Within Reach (CWR). CWR has recently agreed to provide pro bono services to FORGE. As part of this experiment in radical transparency, Social Edge and Kjerstin have invited Curtis to regularly share about the experience in this context.
Introduction
In the beginning of November, I was engaged on a pro bono basis to provide FORGE with a road map towards long term sustainability. You can read here for more about how this process got started. The goal was twofold: 1) give FORGE actual guidance going forward and 2) give potential donors a sense of the organization’s long term prospects if it survived its immediate financial crisis.
As has been true during this brief experiment in radical transparency, Kjerstin and I have agreed to release this document for the benefit of our sector’s shared learning. You are invited to engage with your questions and comments. I would recommend first reading the full report to get a more comprehensive picture of the issues involved.
1. Overview: FORGE as a pathfinder
FORGE has found a new approach to African refugee camps that seeks to transform these “warehouses of pity” into opportunities for education, job training, and other forms of development. As far as can be ascertained, there is no other entity – either as a NGO or formal government body (including the United Nations) – that is pursuing this paradigm.
FORGE thus has already succeeded in the main task of a “pathfinder.” By “pathfinder,” I am referring to the way that a large convoy figures out where it needs to go when it finds itself lost in new territory and uncertain of how to proceed.
Two risks a pathfinder especially runs are a) running out of supplies; and b) losing touch with the main body. Ironically, a pathfinder can succumb to these problems even as it succeeds in its main task: the new route may be so far from the well worn path that the pathfinder ventures beyond the radius of safety.
FORGE has yet to learn how to manage these risks in an optimal fashion. It discovered its promising new route, but with the danger of a) running perilously short of funding and b) neglecting to network enough with more established parties.
Its immediate difficulties are traceable to its inexperience in balancing the rewards versus risks inherent in the path finding endeavor. I have elsewhere pointed out specifics of this inexperience, such as its messaging to potential donors, or the funding model.
However, it is important to reiterate that these difficulties only surface meaningfully for a pathfinder who is fulfilling its core mission: forging ahead far beyond where most felt it wise to stop. The ones who stay well within the radius of safety are rarely the ones who discover the new route.
2. Critical needs: fundraising and networking capacity
Now is the season for building FORGE’s own financial supply line and its relationships with the main body.
This reorientation is especially critical for Kjerstin. She has spent the vast majority of her time on program issues. By her estimation, less than 5% of her time has been spent on networking, and only slightly more on direct fundraising. In the future, she needs to spend more than 60% of her time on these functions.
While the priority of fundraising should be obvious, it is worth noting here why networking more broadly is also very important. There are three main reasons:
- FORGE needs more outside validation and legitimacy. This lack is most evidenced by the absence of any established expert in the refugee field on the board. Addressing this problem requires that Kjerstin get out there regularly in the settings where thought leaders in the field congregate.
- The organization needs to broaden its donor base, especially with foundations and high net worth individuals. This is only going to happen by developing a broader set of relationships than the ones FORGE currently owns.
- Finally, the role of a pathfinder is to bring its findings back to the main body. It may very well be that in the long term, FORGE’s most scaleable influence will not be in the number of refugees it directly serves. I am unsure given all its limitations about how high its numerical growth ceiling can be. But I am convinced it can and should diffuse its ideas. For instance, it may be that FORGE will make its ultimate contribution by getting the United Nations Commission on Human Rights (which oversees most of the relief work in the camps) to incorporate aspects of its developmental model.
3. Short run tactic: pulling back its programmatic commitments
Developing funding and partnership capacity will take bandwidth and resources. FORGE needs to think of the next 1-2 years as a season where it maintains just enough of a presence in the camps to continue refining the model and building legitimacy, but pull back how far it extends itself programmatically.
The full report lists some of the short tem steps FORGE can take in this regard.
FORGE’s own calculations indicate that some combination of these steps could bring its operational budget to $265,000, about $135,000 less than this year’s budget. This will give them some more short term breathing room to build the capacity necessary for the long run.
4. Building the financial supply line
FORGE suffers constraints with three of the four main potential revenue streams:
- Foundations: FORGE has experienced significant disappointment here. Despite devoting almost a full FTE to grant writing, it has made only minimal gains.
- Government: According to Kjerstin, there is little available from the United Nations given FORGE’s model of focusing on development versus relief.
- Corporations: This kind of funding is most viable when the issue intersects with the actual business in some meaningful way, or it is a high visibility issue in the mass culture. Sadly, no company looks at African refugees as a market and the overall issue has low cultural visibility.
This obviously places great weight on FORGE’s ability to do individual fundraising.
5. What FORGE needs for individual fundraising
It is in this area above all else that FORGE needs to obtain some immediate outside expertise. The staff team (including Kjerstin) and the board lack the necessary level of strategic thinking, experience, and/or bandwidth to conceive and execute a fundraising plan at the scale required. Organizational infrastructure needs to be developed in fundamental areas like donor management software and donor cultivation practices.
While providing an individual fundraising plan is beyond the scope of my work here, I will offer some guiding thoughts on a) the role of the board and b) playing to FORGE’s strengths.
a. The Board
FORGE needs to reconstitute its board. The current board has served well its purpose in the initial launch phase as it has given Kjerstin a lot of room to maneuver. But the current board is missing three types of individuals critical for fundraising:
- C-level executive business leaders
- Refugee policy expertise
- Nationally (or at least trans-regionally) networked individuals.
b. Playing to FORGE’s strengths
I have written elsewhere that FORGE has an original “fundraising soul,” one that was born in the college student world. Clearly, it has to expand beyond that world. But it can still retain a connection to that student world in a way that actually fuels its expansion.
For instance, FORGE has a cadre of individuals who in the last five years took a year off of school to work in the camps, raised money for FORGE, and are now back at school or have recently graduated. This is an army of potential evangelists for FORGE. But they need to be led and equipped more proactively than they have been.
6. Conclusion: Will FORGE make it?
My answer to this question really depends on what one means by “FORGE?”
If the question is “Can FORGE as an organization make it?” then I must confess that I have no idea. Pathfinders do suffer a high mortality rate. FORGE faces some significant challenges. The plan outlined above requires some good execution, but truth be told, it also depends on good luck. For an organization at its life stage, a chance encounter with a wealthy individual here, a new government contact there could make all the difference.
If the question is “Can FORGE as an approach make it?” then I would answer, “I sure hope so.” The problem of African refugees is not going away and getting worse. Refugees are staying longer and longer in these “warehouses of pity.” And an entire generation of potential leaders in those communities is being wasted. A new route forward is desperately needed. So the paradigm of treating the camps as development opportunities where the refugees themselves lead the projects deserves a fair chance to gain wider traction. Personally, the second biggest reason I have invested my own resources is that I want that idea to be disseminated, regardless of what happens to FORGE as an institution.
Finally, if the question is “Can FORGE as a group of individuals make it?” then I would answer “Of course.” FORGE’s greatest strength is the passion and commitment of its people, starting with Kjerstin but extending to the US and international staff and the board. Those assets are both enduring and what economists call “fungible:” easily transferred to other contexts. And in that vein, I have told Kjerstin on numerous occasions that FORGE is most likely just the first of several causes she will spearhead over the course of her career. There are few better long term investments, in my book, than giving an obviously talented individual like Kjerstin her first shot at social entrepreneurship. This is the biggest reason I have given of myself to FORGE for this season, and have been quite glad for it.
P.S. Kjerstin and I will wrap up this project in early January and I'll weigh in one last time with concluding thoughts on this experiment in transparency.
Another Consultant's Two Cents
"Donors, especially high net worth ones, tend to be executive types. They are reassured when they see that “one of their own” is involved in FORGE’s governance. This is especially true given how young the FORGE staff is (all under 25). When such a donor looks at the current roster of board and staff members, they see individuals that would be several levels down their own corporate hierarchy, a reality that does not inspire donor confidence."
Although I understand the fear of inexperience, why should it matter that FORGE's staff is all under 25? I've found that in the nonprofit sector more than the for-profit sector, ageism against young individuals is much more of a significant problem. Angel investors and venture capitalists have no problems funding young twenty-somethings from Stanford who they believe have a great idea and great potential, but when it comes to a young twenty-something who has an amazing track record of passion, intelligence, and on-the-ground experience like Kjersten, few from the foundation and grantmaking world are willing to take a chance. And many of the fears that potential donors may have can be easily solved through mentorship and good communication - in fact, one advantage of young people is their greater willingness to listen to reason and expertise. But if the foundations don't fund organizations like FORGE and people like Kjersten, then their beliefs become a tautological self-fulfilling prophecy BECAUSE the eventual failure will undoubtedly happen because they refuse to support the organization.
It's so frustrating to see that the "pathfinders" are often times far too ahead of the curve for the funders. Unlike the for-profit world, where being ahead of the curve is more likely to get you funding, in the nonprofit world, being ahead of the curve is less likely to get you funding (grantmakers may not "get" it; the method of producing impact doesn't "fit" the somewhat arbitrary grantmaking guidelines, etc). Thus, one of the perverse incentives of the nonprofit finance market is that it encourages social entrepreneurs to instead of come up with an idea first, look at the available funding streams first. Even though it seems that FORGE is correctly focusing on development rather than relief, since the SROI is probably much higher there, the difficulty of finding funding is much higher than it should be.
I'm not too enthralled by the idea of "playing to FORGE's strengths" through its alumni and student base. Both, while passionate, are often an undependable source of labor - many are already extremely busy with their own lives and initiatives and many will be worried about their future careers; becoming a FORGE evangelist, even with the certainty of success, may not be enough incentive. Add to the fact that there might be a high likelihood of failure (one big question I have is: how are you going to raise several tens or hundreds of thousands of dollars through friends and family in a down economy when many are already questioning your career choice?), I have to wonder whether this path is simply a moment of wishful thinking because the other funding sources haven't looked so great in the past.
I think your recommendations of changing the composition of the board is spot on, but I would encourage step 2 to be another push towards foundation funding. I would be interested in knowing what kind of feedback FORGE has received from foundations in their grant application process (if any - something the sector really should work on) and whether or not there is anything FORGE can do to meet any additional requirements in the next cycle of funding. If FORGE can land a grant from a big foundation in this space, I think that would be the best way to achieve the legitimacy it needs and solve its many other problems. To start, I think Hewlett might be a good prospect for a variety of reasons - there's a strong Stanford connection, they have a global development program, they understand SROI and impact analysis (see their new book Money Well Spent). Kjerstin, Curtis - would be happy to talk more offline.