From Starvation to Sustainability: Rethinking Revenue in Social Impact

Is your social impact brand attracting enough revenue to power your mission and build a healthy, sustainable organization? Or do you feel like you’re constantly chasing donors and customers just to keep the lights on?

Chances are, the second scenario hits closer to home. If so, you’re not alone. Because the social impact sector has a revenue problem. And it’s not a small one. 

We’re not just talking about donor retention, or shifting consumer behaviors, or downward trends in giving and support for social impact causes either. We’re talking about deeply rooted cultural beliefs and narratives that have shaped our entire sector. And that many of us have just learned to accept as inevitable.

Folks, we can’t keep going like this. We have to stop accepting that a lack of revenue and resources are just “part of the job” in the social impact space.

In this article we’re going to outline the outmoded beliefs and narratives that lead to unsustainable revenue in the social impact space and challenge leaders to consider a new mindset and path.

This foundational strategy and mindset shift applies whether you’re a small nonprofit just getting started, or a social enterprise with a market-based model, or an established organization that’s struggling to break through a stubborn revenue ceiling. 

Let’s get into it.

Beliefs and Narratives Leading to Unsustainable Revenue in the Social Impact Sector

Why have we come to accept that our sector operates with a lack of resources and revenue?

Nearly two-thirds of social impact organizations are unable to provide competitive salaries for their team. Nearly half of social impact professionals are burnt out. The main reasons cited for this are a lack of resources, and too high of a workload. This is leading to job vacancies that are 10% higher than average in the broader market. 

Stop and really think about this for a minute. Why should we accept that this is just the way it is? 

A Sacrificial Social Mindset

The social impact sector is treated like a “second-class citizen” to the corporate sector, and it’s holding us back in more ways than we realize.

We’re expected to make personal sacrifices to dedicate our career to social impact work. Our work is over-scrutinized compared to our profit-driven peers. 

We work on the world’s most difficult, intractable problems and then people don’t understand why we can’t solve them immediately. So it’s no surprise that we’re seeing burnout, a mass exodus from the social impact space, and that trust and giving are in decline.

These issues stem from a deeper cultural belief — within our industry and across our society in general — that if you want to dedicate your work and your life to creating social change, you’re going to have to make sacrifices and tradeoffs to do so. And the fact is, for many of us, this is 100% true. 

But this is a self-fulfilling prophecy. Because when we as a sector accept these beliefs, we knowingly or unknowingly perpetuate them through our actions. And perpetuating these actions helps reinforce these beliefs and norms. And the cycle repeats itself.

And if you’re not generating the revenue that you need to run a truly successful, sustainable, and healthy organization, then you might even have to make some of these trade-offs yourself. 

As a sector, we need to challenge these narratives and beliefs. We need to be bold enough to say, no, this is not okay and we cannot solve the world’s greatest problems if we don’t have the proper resources to do so. 

A Quick Illustration

A post from an executive director in early 2024 celebrated the receipt of a $2m gift from MacKenzie Scott. 

If you’re not familiar with MacKenzie Scott, the CliffsNotes version is that she has invested close to 18 billion dollars across over 2,300 nonprofits — all unrestricted gifts. For most of these nonprofits, this was the largest single unrestricted gift their organization had ever received.

Anyway, back to the story about the executive director. They were rightfully excited about the opportunity and the ability to reinvest the funds into building a more sustainable and resilient organization with this surprise influx of cash. 

But then they also celebrated that it meant all other donors could rest easy knowing their donations would go directly to program work instead of overhead. 

We have to stop perpetuating this cultural narrative of overhead vs. program work, as if they are not both equally necessary to building resilient, sustainable, and effective social impact organizations.

We’ve put so much blame on funders and donors for the overhead myth, but in our opinion, many nonprofits are equally responsible for perpetuating this cultural belief. 

We can’t build effective social impact organizations that can only grow and flourish if a surprise gift from a billionaire shows up. We have to design and build a sector and a cultural understanding that social impact brands need general operating funds to invest into building effective and healthy organizations as well.  

Why? 

The Tide is Turning

We’re not the only ones picking up on this idea. There’s a tidal shift underway that’s growing every day. And it’s being led by a movement of social impact leaders and believers who are standing up and saying “enough!”

The next generation is savvy, activated, and relentless in their conviction for social progress. 

Progressive funders are stepping up and giving more trust and sustainable funding to their social impact partners. 

The sector is made up of smart, passionate people who are still making a measurable difference, despite the structural barriers working against them. 

We invite and challenge you to join the ranks of these revolutionary leaders. Believe, as they do, that their work matters as much — if not more — than that of the for-profit industry. 

There’s a brighter future ahead if we choose it. One where people working in the social impact space don’t have to turn to subsidies to feed their kids. One where sacrifices in income, social status, and career potential aren’t a requirement of working in the social impact sector. 

Walk with us into a time where sustainable revenue is the normal mindset and the largesse of billionaires is icing on an already rich and bountiful cake.