Why we should stop using the term "nonprofit"
A few months ago I found myself sitting beside an enthusiastic business-school graduate on a flight to Honduras.
He was on his way to Peru for a one-week adventure in the Amazon rainforest before starting a demanding and exciting executive-track career at a medical company in Ontario.
After we chatted about his passion for sales and the internship that landed him the job, he asked me what I did. When I told him I run a small nonprofit organization he looked surprised.
“Oh..you can do that full time?” he asked.
I could tell he lost interest immediately.
And then it hit me: In one sentence I had defined my work using a negative phrase that inaccurately described what I actually did.
I had defined my organization in direct contrast to the one metric he was most evaluated by. And while – just like in his business – we believe in maximizing the return from every dollar we receive and measure our impact rigorously, I had painted a picture of the opposite.
Just like his company, we focus incessantly on our bottom line. For him it might be higher profit margins; for us it’s greater social impact.
The shareholders he answers to are investors looking for the highest return on their venture capital; the ones I answer to are donors looking for the greatest impact for their philanthropic dollar.
Just like any successful business, we set clear goals, hold ourselves accountable and are judged on our results.
While we adhered to a different bottom line, that doesn't stop us constantly trying to get that final number to become as big as possible -- whether that's more children in school, improved teacher training or more efficient and effective schools.
I started thinking about how often the term nonprofit is actually the sector’s greatest obstacle.
We’re the only industry intent on defining ourselves by what we are not.
Have you ever heard somebody say they work in the non-furniture sector, or the non-manufacturing industry, or the non-technology space?
Just because nonprofit is a legal structure doesn’t mean it should define us. It strips our work of its value – and it’s just plain bad marketing.
Merriam-Webster defines non as "of little or no consequence: unimportant: worthless."
And, as Dan Pallotta points out in Uncharitable, the word “profit” comes from the Latin noun profectus for “progress.”
Which means that “nonprofit” literally means non-progress.
Is that a good position to start from when tackling some of the world’s most pressing issues?
In an industry whose entire reason for existence is progress, it’s clear that we need to reframe the words that we use to describe what we do.
Confucious said that “If names are not correct, language will not be in accordance with the truth of things.”
So what should we use instead?
Adam Braun of Pencils of Promise calls his organization a “for-purpose.” In this incredible culture deck, Mark Arnoldy describes his company as a “for-impact.” Pallotta likes to call it the "humanity sector."
If you ask me, these are far better than nonprofit – and will make airplane conversations far more meaningful in the future.