“I don’t want to just sit and write about this, I want to do something. I have a passion to be involved.”
If I had to use one word to describe Jim, it would have to be fascinating. As an educator and businessman, from the moment he starts speaking it’s clear he’s always been a teacher, seeking to share what he has learned with the next generation, while taking time to continue sharpening his skills as he goes. We spoke on the phone one morning before we both, respectively, were darting off to outdoorsy vacations, and I told him that his reputation preceded him. I had heard about his passion for taking what he had learned in all his years in the for-profit sector, and transferring them to the nonprofit sector, and I was intrigued. I asked him to explain, and he was happy to elaborate.
“After seeing so much success in the business world, I started to wonder, why don’t really good nonprofits go to scale and be national players as easily as it happens in the private sector?” he said. “Why couldn’t we take a perfect model that is having an impact and replicate it to have the same impact all over the country?”
Jim told me about some of his efforts to address this question with nonprofits in the Triangle area. He has been working with TROSA, a Durham nonprofit that helps substance abusers become healthy, productive members of their communities and families, to see what it would take to scale their work. He is passionate about the services they provide and the success they have delivered with their approach. He believes that from a business sense, TROSA could be successfully expanded to many locations serving a much larger population of substance abusers. But execution creates many significant challenges. One major issue is the very significant investment it takes to make something like this happen.
“In the for-profit sector, you cannot win without having thinking about expansion and growth, and the financial systems are set up to support this strategy,” Jim said. “When you look at the nonprofit side, though, they are just trying to get funding to literally almost survive on the organization’s delivery. They never seem to run into someone saying – I have more than enough money for you, and I want you to help me expand your services nationally. You worry about how to make that happen. There’s got to be a way to change that.”
Jim shared with me that he sees a real need to take the for-profit culture and create vehicles that can support ready nonprofits that can make it work. He spent last year, with the help of the Foundation and through the Fuqua School trying to find nonprofits who were ready, who knew their theory of change, and who could replicate on a large-scale if they had the right investors.
He explained that the “theory of change” a nonprofit uses is a critical starting point of addressing the opportunity to take on an expansion strategy. It needs to address a number of key questions, such as – How will the people I am serving be better? How do I objectively measure success? What is the “secret sauce” that makes our organization deliver performance better than anyone else? Who sees the benefits of what we do and would pay to see us serve more people?
“Few of the nonprofits I’ve talked to are so prepared to say that if their theory of change occurred, if they had investors, and were presented with the option to do it for more people, they could do it,” he said. “All had certain areas that they were good at in a business-sense, but few of them had worked up and through this question. I don’t blame any of them for not having this put together though – I blame the culture that hasn’t ever given them someone who says – don’t worry about money, worry about delivering results.”
He thinks that if that start to happen, we will see a tremendous speed of accelerating organizations that can do this. We will also see that there are a number of organizations doing very similar things and that the redundancy is a very inefficient use of resources. Addressing the issue of redundancy will not be easy and is one of the significant barriers to accelerating the growth of promising nonprofits.
“Consolidation will most likely need to take place – even within a region – and that’s political and challenging to make happen,” he said.
So what does Jim hope to gain by sharing his philosophy with me? I ask him, and he’s happy to answer. He says he’s only one person. One fundholder, one investor. He can only do so much. He wants to hear from others, and he wants to learn too.
“If we can take these ideas and baby steps and get a group together who resonate with the potential that exists, we may have a critical mass to have something special happen in the Triangle, “ he said. “We could eventually be seen as a leading edge area for change on a national basis. I think the expertise exists here to initiate programs that make a difference. The diverse interests of fund holders is a natural place to explore ideas. Traditional investor groups who have only been thinking of for-profit opportunities might be pleasantly surprised to find investment opportunities in the nonprofit sector that meet their criteria for deploying financial resources in new types of organizations.”
Jim thinks this sort of collaborative work could do great things for all sides. What do you think? He’d love to know. Send us an email at email@example.com and we’ll connect you!
About Jim: Jim Emshoff has had a remarkable career, spanning many different sectors that include academia, corporate business, and venture capital.
In his role a faculty member at the University of Pennsylvania’s Wharton School and most recently at Duke University’s Fuqua School of Business he has always sought to impart wisdom about business, success, and impact to his students. In his role as an executive and/or a board member of large companies like Citibank and Campbell Soup or smaller entrepreneurial businesses, he has focused on the complexity of business; what is right, what is responsible, and what can propel an idea forward and upward.
A current resident of Chapel Hill with his wife Marguerite, he is a fundholder at the Foundation.