Big apps am i for or non profit

NYC BIGAPPS!what am i?!

for profit, non profit, or something else?!!

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jen van der Meer!@jenvandermeer!

jenvandermeer.org

@jenvandermeer

BIGAPPS 2014

• Choose your own adventure: solve a civic challenge, improve the lives of New Yorkers.

• Solve a Big Idea challenge: how tech can make NYC a better place to Live, Work, Learn, or Play.

• AKA, do good.

Idea Team App Money

questions for hackfest/competition entrants:• Is my app a business?

• Am I a for-profit or non-profit?

• Am I a consultancy or a product company?

• How do I start a business but keep my vision intact?

• Am I scalable or is scalability going to kill my dreams?

• What am I? Do I quit my day job? How many months till I can pay rent?

agenda

• For vs. Not for Profit

• For profit

• Non profit

• Get out of the building

for profit, non profit, or something else?

you used to have to pick a lane

Non profit Do good

For profit Make money

“The social responsibility of corporations is to increase profits.” - Milton Friedman, 1970

now it’s a paradox of choiceS Corp

LLC

C Corp

B Corp

Coop

Social Enterprise

Social Impact

501 (c) 3

501 (c) 4

501 (c) 7

501 (c) 9

Social Business

you no longer have to choose

Non profit with sustainable revenues

For profit out to change the world

key differences

Non profit • Defined to fulfill a mission • Tax exempt • Does not retain profits • Does not distribute ownership • Assets belong to organization • *Cannot use funds other than for the

mission for which it was formed

For profit • Pays taxes on profit • Can distribute ownership to

employees and investors • Assets belong to the owners • *Can have a capital exit, benefitting

the owners of the company !!

both require money (and love) to sustain and grow

Non profit with sustainable revenues

Fon profit out to change the world

for profit

for profit funding sources

SBIR Grant

Growth Capital

Friends+Family

Angel

Seed

Series B, C, D…

Public Company Bootstrapped

Self Sustained

Acquisition

Corp VC

Acquihire

Government Grants

Crowdfunded

IPO

are you a startup, or a scalable startup?• “A startup is a human institution designed to deliver a new product or service under

conditions of extreme uncertainty.” – Eric Ries

• “A startup is a company designed to grow fast.” –Paul Graham. Y Combinator.

• For a company to grow big, it has to make something a lot of people want. To reach and serve all of those people.

• “A startup is a temporary organization designed formed to search for a scalable repeatable business model.” – Steve Blank. !

• Most startups change their business model multiple times.

• A scalable startup is a special class of startup – world class team, large vision, large target market, passionate belief and a reality distortion field.

http://www.venturegiant.com/news-channel-396-when-should-an-entrepreneur-start-looking-for-investors.aspx

stages of investment capital requirements

Consulting 29%

Services: Other 17%

Technology: Internet

14%

Real Estate 14%

Service: Business Service

13%

Retail Store 13%

Source: Kauffman Foundation Legal Zoom Startup Environment Index 2012

not all new companies are growth startupsTypes of new companies formed 2012!

for profit hybrids• Social enterprise: social or environmental purpose,

may be willing to limit scale opportunities to meet more local goals, or directly serve the need.

• B-corps are a type of social enterprise that also agrees to transparently share financial results.

• Social businesses (Yunnus): for profits that re-invest to meet a social need.

• Social impact growth: aiming for scale and for social/environmental outcomes, and high growth returns to investors.

http://www.ssireview.org/articles/entry/in_search_of_the_hybrid_ideal

non profit

non profit funding sources

Membership

Foundation Grants

Government GrantsCorporate Giving

Services Revenue

Donations

Crowdfunding

Bequests

scale is all the rage in non profitsThe average founding year of the 10 largest U.S. nonprofits is 1903.

Not for profits are one of the US’s fastest growing sector, which grew 60 % to more than 1 MM organizations from 1999 to 2011.

How more recent organizations got big:

1. Developed funding in one concentrated source rather than across diverse sources

2. Found a funding source that was a natural match to their mission and beneficiaries

3. Built a professional organization and structure around this funding model.

http://www.bridgespan.org/Publications-and-Tools/Funding-Strategy/Why-More-Nonprofits-Are-Getting-Bigger.aspx#.U6RblY1dU7s

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“The jury is out on whether scaling organizations will translate

into scaling impact. There is an emerging set of questions about

how such scale links to local community engagement, which may be the linchpin of lasting

social change.” !

-Bridgespan Group

where the money comes from

http://grantspace.org/Tools/Knowledge-Base/Funding-Resources/General/How-are-nonprofits-funded

i still don’t know which way to go what do I do first?

where to start: customer discovery• Lean startup, lean launchpad

• Form a hypothesis about how you will grow

• Define your total addressable market, or the size of your total addressable beneficiaries

• Business model canvas

• Validate your early hypotheses

• Test and learn

get out of the building

Get out of the buildinglisten

Get out of the buildingobserve

Get out of the buildingSolveask what they need

Thanks! !

@jenvandermeer

further questions

• To add to resources and tools, contact Jen van der Meer: @jenvandermeer

• www.jenvandermeer.org

• jd1159 at nyu dot edu