Courageous Closure: In Search of Nonprofit Happy Endings

First-Hand Experience

Approximately five years ago, I was the willing participant in the wind down of a nonprofit organization that I co-founded and co-led for four successful years. The organization was a nonprofit consultancy for other nonprofits, formed at the behest of local community funders in recognition of the tremendous need for nonprofit capacity building of just about every conceivable nature–governance, leadership development, process improvement, evaluation, strategic planning, and fundraising. The philanthropic community (foundation and corporate) generously provided three years of seed/start-up funding, and a local university provided in-kind office space and complete access to its meeting facilities and business center. It was a collaboration noteworthy for its cross-sector response to a glaring community need.

Our business model was a replica of similarly organized, but loosely-affiliated, nonprofit consultancies around the country. Volunteer consultants were recruited and, in some instances, trained to provide high-quality consulting services to nonprofits at below market rate in order to remove financial barriers to access, while ensuring that the organizations still had some “skin in the game.” Additionally, we received project-based grants to deliver three signature programs: “Building Better Boards,” “Executive Leadership Roundtable,” and “Leading from the Middle.”

Alas, by the end of the third year the non-renewable start-up money dried up. It became clear that our business model was not sustainable and, after a carefully executed self-study (conducted by our very own volunteer consultants), our board made the courageous and correct decision to close. My co-founder and I fully supported the decision, in acknowledgement of the fact that excellent resources now existed through a statewide nonprofit membership organization, and that we had helped to create a cadre of strong nonprofit consultants in our local community to carry on the work. Just as importantly, we believed that we needed to lead by example and make a graceful exit when there was insufficient community will and community financial support to justify a continued existence.

Seeking More Examples

That experience recently sent me on a quest to find other nonprofit organizations that have willingly, and maybe even happily, gone out of business, either because they successfully fulfilled the mission for which they were created, or in acknowledgement of the fact that there were a sufficient number of other service providers in the community doing the same work as well or better. In my search, I have Googled every conceivable keyword, queried statewide nonprofit organizations, polled foundations, stalked former executive directors and board members of shuttered nonprofits, and initiated discussions on LinkedIn groups. All to no avail.

Crowdsourcing Challenge

And so, in this time of unprecedented growth of nonprofits, and correspondingly alarming shrinkage of resources, I would like to issue a challenge. Help us capture the stories of successful nonprofit dissolution. We’re interested in those “happy ending” stories–where the decision to go out of business was intentional, thoughtful, planful, and ultimately in the public interest. Share with us so that others might learn by example that courageous closure does not equate to failure.