Kathleen Kelly Janus On How The Best Non-Profits Launch, Scale Up & Make A Difference

Kathleen Kelly Janus is a social entrepreneur, author and lecturer at Stanford University. Her new book, Social Startup Success: How the Best Nonprofits Launch, Scale Up and Make a Difference, is a playbook for how nonprofits scale.

As an expert on philanthropy, millennial engagement and scaling early stage organisations, her work has been featured in the Wall Street Journal, Huffington Post, Stanford Social Innovation Review, Tech Crunch and the San Francisco Chronicle.

She is the co-founder of Spark, the largest network of millennial donors in the world. Based in the heart of the Silicon Valley, her forthcoming book, Social Startup Success, features best practices for early stage nonprofit organisations based on a five-year research project interviewing hundreds of top-performing social entrepreneurs.

Kathleen discusses key insights gained from hundreds of interviews conducted with social enterprise and non profit leaders and shares trends in philanthropy, policy, millennial engagement and collaboration with government.

Highlights from the interview (listen to the podcast for full details)

[Tom Allen] - Could you please share a bit about your background and what led you to working as an Academic and in the non-profit sector? [2:16]

[Kathleen Kelly Janus] - Well, I was raised in a small town by parents who always taught us that it was our duty to give back in the world, and so we often spent our weekends volunteering at soup kitchens and at the local hospital. But my parents always taught me that it wasn't just about making sure that we were taking care of those in our community who didn't have enough to eat, that it was also about making sure that the organisations themselves, that the soup kitchen itself had enough resources and the strategy that it needed to survive and thrive and provide those crucial social services.

So from a very young age I was always very aware of the importance of supporting non-profits and when I started my career as a young lawyer in San Francisco, I also spent my nights and weekends giving back and volunteering, and discovered this challenge of non-profit scale from a personal perspective, when I co-founded a small non-profit in San Francisco called Spark. We were doubling our revenue every few months and had a tonne of buzz. Yet, even with all of that, we couldn't raise more than $500 000 in revenue. We hit this wall just when we were hitting our stride.

I became really curious when I eventually began teaching social entrepreneurship at Stanford, wearing my research cap, why is it that some organisations succeed and others do not? I've spent the past five years travelling the world interviewing 100 of the top performing social entrepreneurs and their teams, and their beneficiaries and their funders. All to get to the bottom of this single question. Why do some organisations succeed in scale and others don't?

It's an interesting story Kathleen and much of your experience has been collated into this new book, Social Startup Success. Could you please tell us more about the key arguments from the book and what you believe the fundamental ingredients for building a successful organisation that creates positive impact? [4:17]

To me what was most striking as I was going through these interviews in a very condensed way and talking to many people every week, was that I kept hearing the same strategies over and over again. Testing, measuring impact, funding experimentation to get to a funding model that was consistent with the organisation's mission, collaborative leadership drawing on senior leadership staff and board to succeed, and storytelling and being purposeful about storytelling.

What's most exciting about these findings to me, is that I kept waiting for someone to say it's just charisma or a good idea that gets an organisation to the next level. No one said that.

It's not to say that charisma and good ideas aren't important, they absolutely are, but it's really these fundamentals, these foundations that organisations can lay using strategies that are well tested by other organisations that can help organisations position themselves for scale.

And that it doesn't have to cost thousands and thousands of dollars in consulting fees to do that. That every organisation can learn from the tools that I talk about in Social Startup Success to position themselves for success.

In your hundreds of interviews, how have you then seen the social enterprise sector transform and change, and where do you see it heading? [6:11]

It's funny because I grew up with my Father's non-profit, which was very much about if someone is suffering, let's give them what they need to stop that suffering. It's sort of about band aids. What can we do to help take care of this wound?

But I think what charity has realised, is that it's not enough to put band aids on these solutions. we've been putting band aids on solutions for decades and those band aids are doing nothing to solve the underlying wounds that are causing the problems in the first place.

This movement of social entrepreneurship, which is really just applying innovation to non-profit ideas and social change, is that it's not just about giving a man a fish or even teaching a man to fish. It's about revolutionising the fishing industry and shifting the paradigms that are causing injustice in the first place.

It's a much more sustainable approach to non-profit change and hopefully something that will be much more affective for the long term.

Absolutely. So you've been teaching at Stanford University now in a programme on social entrepreneurship. How do you believe students then can most affectively be engaged and supported in learning about social enterprise and the sort of findings that you have communicated through your book? [7:39]

Well I learn so much from my students and what's so exciting to me, is that this next generation is approaching social change in an even more expansive and different way. There are no longer boundaries between for-profit and non-profits.

Young people have so many more tools in their toolbox to solve these pressing social problems that we face, like climate change and global poverty.

I think that's a really exciting trend that students bring to the table, that there's no longer this sort of dichotomy of I'm either going to go to a non-profit and make a difference, or I'm going to go to a for-profit and make money. But there are many, many, many different places in between.

The advice that I always give my students though, is to really go work for someone before you start an organisation.

This is what I learnt from so many of my interviews, is that a lot of these stories start in very much the same way, that someone graduates from college and then they go and start an organisation and they end up falling a lot, frankly, because they have never been hired before in their lives, let alone hired someone else.

These challenges of management, of figuring out how to measure impact effectively are all real challenges that other organisations have really dealt with and so I think it's really prudent for young people to go learn from others before they start their own organisation.

In a recent article that you wrote about philanthropy for the Stanford Social Innovation Review, Kathleen. You wrote about no mission being as urgent for the philanthropic sector as finding better ways to allocate the 373 billion dollars of funds that are given annually to optimise impact. On that note, how have you seen philanthropy change and how might non-profits better receive philanthropic dollars? [9:45]

Philanthropy has changed enormously over the past several decades.

Philanthropy used to be about writing a cheque and being done. That is no longer. Foundations and funders want to be involved in their philanthropy. They want to write a cheque and then they want to lean in and roll up their sleeves and help not only with their dollars, but also with their expertise and their networks.

And that's really exciting, because we need all hands on deck to solve these really pressing social problems, and so funders are getting more involved.

The other really huge trend on the funding side, and this has been in large part because so much of the funding, at least in our region in the Silicon Valley, is coming from people who have been successful in the tech sector, is that they're applying a lot of these principles that they learned in terms of return on investment and trying to think about efficiencies and scale, are applying these principles to the non-profit sector.

On the one hand this has been really, really positive in helping to develop better key performance indicators for example, to determine metrics, not only to prove that a non-profit is doing work effectively, but also to help them improve and be comfortable with failure, and to put aside ideas that maybe aren't working as well as they would like.

I think this has all been super positive, because we need to understand where organisations are having impact so that we can be as efficient as possible with the resources that we have.

But I also think we need to caution funders against taking this to an extreme. There have been some funders, like Sean Parker for example, the founder of Napster and one of the co-founders or early investors I guess in Facebook, who's decided to put a lot of his money toward what he calls hacking philanthropy or trying to figure out how to be as efficient as possible with his philanthropy.

So for some funders, like Sean Parker who wrote in The Wall Street Journal about this topic, it's about solving ideas that we know we can solve that are measurable. Like can we reduce the number of cancer ducts for example. This has been a big focus of his philanthropy, which is great and we also need to remember that not everything that we need to solve is measurable in the same way as like number of deaths or number of people.

We're thinking about improving human rights. This is a very intangible approach to social change that we need to honour as well and think about how do we also tackle problems where we might not see the impact of our work for decades to come.

Looking at social enterprise then from a policy perspective, what do you believe the key steps government needs to take to help foster and support an innovative social sector? [13:18]

Government can be supportive in many ways. Certainly in the United States we've seen a pay for success movement, which has been a really interesting strategy that the Obama administration implemented to use a metrics based approach to help fund organisations that are showing that they are having an impact in their work. So funding is certainly one aspect.

I think also partnership with non-profits is really critical. We know that non-profit models will not be scalable in and of themselves.

In the United States for example, 170 charities that have been founded since 1970 have scaled past 50 million dollars. That's a really finite number.

To scale big ideas we have to implement them into policy. Thinking about how we can develop partnerships with government, is really critical in order to achieve that level of scale.

Are there any countries then that you believe are really doing this well or that are leading the charge when it comes to social innovation? If so, what are they doing that you think that other countries like the States or Australia could adopt? [14:42]

My focus is on the United States, partly because I have had three babies in the time that I started writing this book and so my travel was limited to the United States, even though I have a background in international human rights.

I can only speak to the United States, but what I will say here, is that the most innovative partnerships have been the ones that have taken ideas that the government wouldn't otherwise be in a position to implement.

For example, needle exchange programmes are a great example of something that the government would never in a million years test. First of all because it's very controversial; this idea of giving people free needles to break their drug habits, and second of all, because government is not small and nimble. Non-profits are.

I think what we have to do, is we have to recognise what are the competitive advantages that everybody is bringing to the table and leverage the advantage that small non-profits have of being small and nimble. Then work towards developing partnerships with government to highlight the approaches that are working and bring them to scale.

Looking at some inspiring projects and initiatives, which funds have you come across recently, which are creating some great positive social change? [16:17]

One example that I love, that really highlights why we need social entrepreneurs to be testing the best possible strategies on the ground, is an organisation called Last Mile Health. That's based in Liberia. Raj Panjabi started the organisation after graduating from Harvard Medical School because he had fled Liberia in the Civil war and wanted to come back and help rebuild the country.

When he first started the organisation, he was testing out 13 different programmes. Everything from reproductive health to solving the HIV/AID programme, to training community health workers. Often times, people in rural areas had to walk 12 to 13 hours to see a doctor in the capital city and so you can imagine these people who are already weak and feeble, having to walk that far to get adequate medical care.

He thought about, well, what if we can train people in those communities to provide care even if they're not necessarily doctors. Using cell phone technology, how can we connect them with doctors to give these people the treatment they need without actually forcing them to walk 12 to 13 hours. He started testing all of these programmes and realised very quickly that the community health care programme results were blowing away the results and the impact that he was having with the other programmes, and not that those weren't great programmes. They were doing really important work, but just in terms of the resources that he was contributing. He saw this as the best possible way to make impact.

He started channelling all of his resources into that programme. He closed all the other programmes down to really make that the focus and it's a good thing he did, because when the Ebola crisis hit in 2012, Last Mile Health community health care workers were absolutely critical to alleviating a global health crisis. So if we think about impact, we would be possibly living in a very different world, had it not been for the intervention of Last Mile Health.

I think this really epitomises the essence of social entrepreneurship; leveraging small ideas to make really big change in ways that can be replicated, not only in Liberia, but in countries all over the world who have similar challenges.

That's a really inspiring initiative there and I'll stick a link to it below. To finish off, Kathleen, as an author yourself, what books would you recommend to our listeners? [19:00]

So many good ones. The one that I am reading right now, actually listening to, I really recommend listening to books too, for those of you who are busy and have commutes and long time in the car, is Malala's book on how she became an activist for girls education and fought against the Taliban as a 14 year old girl, is so, so inspiring. I think it makes us all feel like we have the capacity to make a difference in our communities.

I also really recommend a new book by Nadine Burke Harris, called The Deepest Well and it's about childhood adversity and looking at how we all have the potential to be advocates on behalf of children locally and globally. Then if you want to see my full list of book recommendations, I can send you a link to a good reads, good minds suggest column that I just did with my favourite books about how to make the world a better place.