Nonprofits on the Move with Mergers

Too often discussions around nonprofit partnerships and mergers focus on the financial drivers. For example, one nonprofit may be in crisis and rather than shutter operations, it seeks to form a new organizational structure with another, more financially robust organization.

But there is another important reason nonprofit leaders should consider exploring partnerships: mission impact. This plays out in a variety of ways.  If you are successful in achieving your mission, then it stands to reason that over time, your mission may need to evolve. Or perhaps your client population has shifted dramatically with the region’s changing demographics? Or better still, what if the social problem your organization originally formed to address dramatically improved or changed?

Lessons from San Francisco and Beyond

Such pivots are currently apparent in the nonprofit subsector of HIV/AIDS-related services. Many nonprofits, founded 30 years ago, focused on an acute public health crisis impacting a smaller demographic segment of the population. But over the decades, as new drug treatment modalities became available and as the disease spread across other demographic segments, the service models and organizations had to adapt to the chronic, long-term needs associated with supporting HIV positive clients.

This summer, the San Francisco Chronicle and Nonprofit Quarterly reported how “Clients have gone from young men who were dying at 25 to older patients who, at 55, are still living. Currently, more than half of the people with HIV in San Francisco are 50 or older. Improved safer sex practices and advances in drug therapies and medical treatments have shrunk the client base dramatically; some agencies serve half the number they did in the mid-1990s.”

These trends have led some nonprofits to shift focus. For example, food services for clients have evolved to serve healthier food for those also living with diabetes and heart disease. Other nonprofits have merged together to provide a range of services around housing, mental health, or substance abuse prevention, in addition to HIV/AIDS-related support.

The need for HIV/AIDS nonprofits to refocus their operations has not been limited to the San Francisco Bay Area. New partnership models, collaborations, and mergers have taken place throughout the U.S. For example, Vista Global supported the cultural integration process for the merger of the AIDS Network and AIDS Resource Center of Wisconsin.

Photo: AIDS Resource Center of Wisconsin (ARCW). Grand Opening of new Medical Home. June, 2016.

Photo: AIDS Resource Center of Wisconsin (ARCW). Grand Opening of new Medical Home. June, 2016.

Exploring the Implications for Other Sectors

The rapid changes in the HIV/AIDS-related space offer lessons that can be applied across sectors. For example, to survive the wake of the Great Recession, arts nonprofits explored a range of collaborations.  City government agencies are considering mergers as well, as highlighted by the recent merger of the offices of Homelessness and Welfare for New York City.

With the fallout from the U.S. housing crisis, social service nonprofits also have to pivot as the face of the homeless population changes. Currently, Vista Global is working with four nonprofits serving the homeless population to explore program collaboration and merger options.

Are the leaders of your nonprofit considering a program collaboration or merger? Share your story in the comments section below or contact Mary today to learn more.