As if the nonprofits sector isn't fragmented and competitive enough...
Anyone involved in the nonprofit sector should take note of this article in TechCrunch.
http://techcrunch.com/2010/07/18/the-many-bottom-lines-of-businesses/
It discusess the existence and growth of 2 new types of legal structures for corporations; the B Corporation (http://www.bcorporation.net/) and the Low-Profit LLC (http://en.wikipedia.org/wiki/L3C).
According to the article, "B Corps now include over 300 companies representing $1.1B in revenue, including Amazon competitor Better World Books
and GoodGuide, a site that rates consumer products for safety, environmental impact, and social responsibility."
Currently, the only thing holding these new types of companies back is the absence of a standardized way to evaluate these companies. Once one method emerges, then you can expect that companies and investors can engage in newly formed public markets and exchanges - a social stock exchange if you will, where the public could invest and expect a real return.
Could this be the death knell for the 501(c)(3)? Unlike the traditional nonprofit, B corps and Low-profit LLC's may be better positioned to obtain large investments because they can deliver a monetary and social ROI. And what major donor wouldn't like to know that they could potentially make their money back while doing some good?
More competition is always a good thing. It will be interesting to see how this shakes out. But the news of these changes is not insignificant.
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