Nonprofit sustainability with Cherian Koshy

Episode aired July 8, 2020: NPO Sustainability

After more than 20 years in fundraising, Cherian Koshy knows all about short vs. long-term planning…and which one will make your nonprofit more successful. In fact, his organization discusses with donors their 40 year plan! In this episode, Cherian discusses¬†

  • scarcity vs. abundance mindset and operating from a position of fear
  • the need for taking the long view of donor relationships
  • the importance of diversifying your fundraising portfolio
  • integrating sustainability into your operations and donor communications and
  • addressing the whole human and all their needs.

Below you can listen, watch or read this podcast episode.


Ephraim: Welcome to this edition of the Your Weekly Dose of Nonprofit Podcast, the podcast that delivers actionable items you can implement at your organization right away. I’m your host Ephraim Gopin of 1832 Communications. Today I’m really happy to have with us one of the top nonprofit and fundraising smarties, Cherian Koshy. Cherian how you doing today?

Cherian: I’m doing well, I’m doing well. Thanks for having me.

Ephraim: A pleasure. Let’s introduce you to our listeners, watchers and readers. Cherian Koshy is a certified fundraising executive and AFP master trainer, with more than 20 years of experience in a variety of nonprofits, where he has successfully helped organizations connect thousands of donors to causes they care about, while raising tens of millions of dollars from foundations, governments, businesses and individuals in the process.

He currently serves as Director of Development at Des Moines Performing Arts, one of the nation’s premier arts organizations. He was appointed by the governor and is the vice chair of Iowa’s Commission on Volunteer Service, where he helps advance legislation to support volunteerism and engage Iowans in volunteer activity. He’s a co-founder of the Des Moines Fundraising Institute, a nonprofit designed to instruct fundraisers on best practices. Nationally Cherian is a regular presenter at the AFP International Conference and regional workshops on fundraising. Cherian was also one of the most successful debating coaches in the United States. His students won dozens of national and international championships. He’s the author of one of the most widely used debating textbooks currently used and has taught thousands of students over the last 20 years.

Achieving Long-Term Sustainability

In today’s episode we’re going to discuss sustainability. Let’s dive right in. Cherian, in a sector where it seems nonprofits live day to day, can long-term stability actually be achieved or is it just a pipe dream?

Cherian: I think the challenge that we face is that as a sector we’re so fragmented. So the simple answer to a very complex question that we’ll get into more detail on is that some organizations will be able to develop or have developed sustainability. But not all of them will and that’s just a function of the diversity in our nonprofit landscape.

So when we look at sustainability, I think there are three elements of sustainability: there’s financial sustainability, institutional sustainability and also programmatic sustainability. So some organizations might get to one element of that or multiple elements and some might not get to any of them. But I think sector-wide it’s something that we should or ought to aim towards.

3 Things To Ensure Sustainability

Ephraim: Okay. So today’s actionable item: Could you please tell us three things a nonprofit must be doing in order to ensure its sustainability over the long haul?

Cherian: Absolutely. So I think the first one is to have a long-term lens. Far too often organizations think of just what they need for the month or for the fiscal year. So because we’ve calendarized our fundraising process so much or so heavily, the longest term lens that we ever look at is a three year strategic plan or a five year strategic plan at best and not a twenty year or a fifty year strategy. So the long term lens I think is the first one.

The second is integrating sustainability conversations and practices in every discussion that you’re having, whether it’s fundraising or communications or programming. It’s really thinking through what does success look like for the long term and how can we have a lens that we look through regarding sustainability in every element of our nonprofit planning and implementation, as opposed to something that we talk about, then we put on a shelf and then it doesn’t inform our staff meetings, it doesn’t inform our communications with our donors or our programs themselves and how we operate them. So the second one is integrating sustainability throughout the organization.

And the last one is diversifying our strategies, diversifying our funding sources but diversifying generally. And the reason for that is that far too often organizations find the niche that’s working and they dive deep into that niche and say this is the thing that we’re going to do and then we build our thinking into that rut and say, this is what’s worked and this is what we’ve done before and so we’re gonna continue to do what’s working. As opposed to intentionally saying, we’ve got to jump out of this rut and approach our problems and potential solutions from the perspective of breaking out of the box that we’ve created and diversifying our strategies. Whether that’s our fundraising sources, saying we’ve traditionally raised money from foundations and grant making organizations, we need to do a better job with our individual donors or we’ve only focused on major donors before, we need a more comprehensive view of our donor pyramid funnel, whatever you want to think of it. Our house of philanthropy needs to be diversified in order to create those levels of sustainability. I think those are the three things that just in my view come to top of mind when it comes to actionable items. But there’s a myriad of other possibilities of thinking through what sustainability looks like. Those are just the ones that jump out to me.

Organizational Short vs. Long-Term Needs

Ephraim: That last one especially about diversification of fundraising sources. So as a fundraiser, how do you balance your organization’s immediate needs versus long-term stability when dealing with donors?

Cherian: That’s a great question and so just taking a page out of the book that I recommended, we have sustainability conversations with our donors. It’s a regular practice to focus on the long-term elements of the organization but also the long view of a donor relationship. The way to frame that is to think of sustainability in terms of being donor centered in our communications. We want to make sure that we’re understanding where the donors passions are, what they care about but also really communicating to them that our needs are not just today, they’re not just this month or this quarter, the needs of the beneficiary are long-term. They’re going to be… there is an ongoing need for the presence of the arts in our communities and how it transforms our communities moving forward.

And so in the kind of practical element of that is that when my boss, the CEO, is doing presentations to community groups or talking to donors, we frame it with how the organization was founded 40 years ago and we bring that into the conclusion with where the organization will be 40 years from now. And to say, we had this group of people who saw a need 40 years ago and galvanized the community and said, this is important. And what we need is people who look forward forty years and say, we will need this to continue to exist and thrive forty years from now. You have the ability to be those new founders of the organization and sustain the organization moving forward. So we look at that not just in the verbal communication of how we talk to community groups or major donors, but how we talk to every donor and to relay to them what the approach is of the organization.

Some donors really just care about making sure that the kid today or a school today or a performance today is funded- and that’s totally fine. We want to lean into donors portals of purpose or portals of passion as it may be and because those needs do exist. But where we do have opportunities for long term planning with the donors, to talk about what their gift might do ten years from now or 20 years from now or a hundred years from now, those are conversations that we invite and bring in to a different level of conversation.


Ephraim: Love that. You’ve written about what you call ‘short-termism.’ What are the three problems or challenges that short-termism creates for decision making?

Cherian: So I appreciate that and I think that that article on short-termism, it references what is out there in in academic writing already about short-termism. So I didn’t invent that phrase by any means. I borrowed it to explain how it applies to the nonprofit sector. And I think there is another psychological principle that will help me answer that question.

There’s a psychological concept called ‘scarcity mindset’ and it’s often distinguished from the ‘abundance mindset.’ And what I think short-termism does is it clouds our judgment and focuses us on the scarcity mindset. And I think there are three problems of that short-termism or scarcity mindset: The first is that we operate from a position of fear and it holds us back from taking risk. The way that I think about it is when I started out in fundraising, I didn’t know whether I would be successful at the end of the year or how to think about receiving gifts that had a long term horizon. So I was always asking for gifts that would materialize in the current year or right away. I was measured by how much I raised in that year, so I would always ask for, you know, can you make this gift today. As opposed to developing a plan with a donor that was longer-term, multiple years or you know legacy gift planning or things like that. So fear holds us back from taking risks that would benefit the organization or benefit beneficiaries long-term.

The second element is that we view everything in terms of trade-offs. Economists talk about this as an opportunity cost, but we really think of how ten dollars today or ten thousand dollars today buys us X or the absence of that ten thousand dollars means that we can’t do X. So we view it in these very myopic terms and those trade-offs don’t get evaluated across a longer horizon. When you think of ten thousand dollars today, not having that ten thousand dollars could be a strain on how you operate your organization. However if the opportunity cost is a million dollars tomorrow or five years from now or something like that, then the $10,000 today doesn’t seem as relevant, because the million dollars tomorrow provides way more than $10,000 two years from now or ten years from now. So it’s really a mistaken thinking around what trade-offs or opportunities costs look like.

And the last thing is that short-termism and scarcity mindsets encourage us to waste resources. There’s a lot of you know sort of this big box mentality… or sort of actually the opposite, small box mentality. The example that I have is I shop at Costco or Sam’s Club, some of these stores that sell things in bulk and it’s often cheaper to buy things in bulk and then to store them and then use them longer-term, whether it’s toilet paper or chicken salad. Whatever it is. If you buy a lot, you get it at a discount. You get… the price per unit is smaller. But when you’re buying it just for the week or something like that, you are often paying more as a result of buying in lower quantities.

I get that that’s a simple kind of individualistic example but when we view things as a short term, we end up wasting the resources that donors have entrusted to us by spending more than we should and solving problems that are near-term to us, things that are happening right now, as opposed to saying, if we stewarded donor dollars well and had a longer view, we could solve a larger problem for a longer period of time. And there are countless examples from various nonprofits where that scarcity mindset ends up just resulting in kind of churn, like dollars just vaporizing because we feel like we have to solve this problem today, as opposed to solve a larger problem over the long term.

Arts Fundraising vs. Hunger

Ephraim: Long term planning is always gonna win out. You work at the Des Moines Performing Arts in Iowa. How is fundraising for theater and the arts different than fundraising for other types of causes such as hunger or homelessness?

Cherian: You know there’s a great article in the Los Angeles Times this last week, about how the theater is potentially the least essential right now… What I would say is it’s from Leslie Odom Jr. so it’s a great piece if you get a chance to read it. What I would say though is that there is an important place for individuals and for organizations, that are solving issues like hunger and homelessness. Those real needs are important and they have to be dealt with.

At the same time while someone is feeding a hungry child, there is also a need to feed a hungry soul. And a complete human is someone that has all of their needs addressed and taken care of. I firmly believe personally and professionally that we are incomplete until all of those types of needs, the things that feed our stomachs but also that give us joy, are important and teach us things and remind us of where we have been as a people and where we are going as a people.

This article that I referenced talks about how the experience of live performing arts is how community catharsis happens, in that moment where we are confronted with someone else’s story, we are engaging with that artist and also engaging with the rest of our audience, be it our audience members or fellow audiences to come up and confront some of these issues in a way that is healthy and appropriate. And if we don’t have those types of opportunities, then they occur in other places where they are not shaped in the best way and they are not… they’re not handled in the best way. But I really do believe theater and the arts tell stories that wouldn’t be told otherwise and those stories are what make us human. And so I’ve always enjoyed raising money for the arts and I know that there are so many donors who are passionate about ensuring that elements of who we are as a people- and I don’t mean that as Americans- and I think that’s true universally. I think there are universal truths. Story is the currency of every culture. Every culture throughout history, story has been the way in which we communicate the values to one another in a current time but it’s how we take stories from our ancestors and pass them down to our descendants. And that’s what creates the continuity of humanity that makes life worth living.

Learn More About Cherian

Ephraim: I love that answer. Let’s move on to the lightning round and learn more about Cherian. What got you started on your nonprofit career path?

Cherian: I’m sure that as a child I was involved in fundraising things, you know, as a little kid and a lot of transactional things. But my first job out of college or actually out of high school, was to be what they call in the UK a ‘chugger.’ I went door-to-door doing fundraising for organizations like the Sierra Club and Human Rights Campaign and a number of other organizations. So I learned rejection very fast and very often as a result of that. 200 doors a night and response rate of maybe 5% or something like that. But yeah I got my start… and once you do that, a lot of other fundraising seems easy.

Ephraim: True true. If there’s one thing you could shake up in the nonprofit world, what would it be?

Cherian: Besides the short term thinking, I think it would be truly evidence-based practices. One of the reasons why I do what I do with the Des Moines Fundraising Institute is I think a lot of times fundraisers think of the ecosystem, where nonprofits think of the ecosystems too small, it’s just their own organization and their own needs and they think of it as their own donors. When in reality we’re all interconnected and the thing that I say to all the other fundraisers that we work with with the Institute is when you do fundraising poorly, it makes it less likely that donors want to give to my organization. So I’m happy to spend time teaching other fundraisers everything that I know and opening the book wide open and answering those questions because we need organizations and nonprofit people to go out there and make it more likely that people will give money to charity. That’s what we need, is that everyone in the world says, I want to contribute my time, my money, my energy, my passion to move humanity forward and the more that we shrink away from that, the worse off we all are.

Ephraim: Twitter, love it or hate it?

Cherian: It’s a love-hate relationship. I feel like sometimes you and I are the only ones talking to or at each other. I do it, I love… from the people that I follow in particular, I get diverse view points, it’s the diverse set of points from all over the world and I appreciate that element of it more than anything. And just hearing what’s happening out there in the sector or various sectors. And as you know in particular, one of the things that I like to do is look at, especially on Twitter, what other sectors are doing, not just nonprofits. So I encourage people to follow as many relevant kind of people or organizations as possible and sift through that because I think all that information’s useful.

¬†Ephraim: Yes. Your interest in the business world- now we’ll follow up- your interest in the business world, in the stock market, where did that originate? Cherian: I think I’ve always had some sort of interests… as you mentioned in the introduction, I used to coach high school debate and those events often had a current events or business or economics touch points in them. So we were talking about those issues a lot, I was reading about those issues a lot and so that’s just really kind of stuff, that was my practice literally every day after school, we would go read newspapers and clip articles on what was happening in the economy and how did these things interrelate. So it’s just been a feature for 30 years and something I continue to do.

Ephraim: For those younger listeners, newspapers was the printed Internet. 3 reasons to live in Iowa.

Cherian: Well I mean I think the first reason that we chose it was, it is a place that we feel the community, that people are incredible. The people that we interact with, our neighbors and people at schools and those types of things and at work are all fantastic. So we just love the people of Iowa. They’re so friendly and welcoming and encouraging. So that’s the first part. The second part for us is you get to experience all the different seasons. So my wife’s from Texas and I’m from Minnesota. So this for us is sort of a happy medium of it’s not hot all the time and it’s not cold all the time but you get to have snow in the wintertime and it’s 90 some degrees or 30 for people who are on Celsius, thirty something today. So it’s a nice balance. And then I would be remiss if I didn’t say the Iowa State Fair is one of the best state fairs out there, if not the best. I’m biased, I would say the best. I go there most if not every day and enjoy all that the state has to offer in terms of agriculture and livestock and exhibits and food and all of it. Just love it.

Ephraim: Fantastic. Alright, let’s turn the table. You get to ask me a surprise question. I have no clue what it’s going to be.

Cherian: So my question is, you’re an American citizen. You are not living in the U.S. What will be the first place that you visit outside of Israel and why?

Ephraim: So when I travel, I usually travel in the summers to North America. I have a summer routine and I always try to go to a new city. So for example this week I was literally supposed to be today in New Orleans checking out the French Quarter. I don’t want to say bar hopping, people get the wrong idea I’m sure. But I would be checking out the culture in the French Quarter. The truth is when I come to North America, I go to Toronto where I used to live. I have two siblings who live there. I love Toronto as a city. I love to visit. I stay in New York, that’s kind of my base but then I travel.

So every trip I go… Boston for sure. It’s my favorite city in North America. And then Vegas because it’s Vegas. If you talk about Twitter love/hate relationship, I think everybody who I know talks about Vegas the exact same thing: you either love it or you hate it. It’s just one of the other. There’s no middle ground. I happen to love Vegas. So if I’m gonna visit, it’s gonna be Toronto, Boston, New York and Vegas for sure and then a new city. I was supposed to be in Cincinnati, Louisville and New Orleans this summer to check it out. But it means that next summer when I come in, I gotta go check out the Iowa State Fair. Cherian: I was just gonna say you are welcome and I would be happy to host you.

Ephraim: Fantastic. Now I got to put Des Moines on my list of cities that I got to visit the next time I come, when I’m able to come to the U.S. Absolutely.

Cherian: Looking forward to it.

Ephraim: Excellent. Thank you very very much for appearing on the podcast today. You can connect with Cherian on Twitter at @cherian_koshy. Have a great day Cherian.

Cherian: Thanks. You too. Thanks for having me.

Ephraim: Pleasure.