C.    AN ALTERNATIVE TO FUNDRAISING:
       PROFIT-MAKING VENTURES

A profit-making venture offers the potential of high revenue generation with no restrictions on the use of funds.

Participants in the consultation process for this Project are very enthusiastic about the prospect of women's groups collaborating on a business venture. Our research revealed that some organizations and federations are successfully looking beyond the donor market for revenue.

Women's groups could improve their independent funding base by developing new products/services for sale to consumer markets. Profit-making ventures can be developed under a variety of structural models and participation of member groups does not require charitable status. Such ventures can also provide employment for women and promote self-sufficiency.

Start-up of a business venture can be useful in attracting new volunteers to women's groups but start-up costs can be substantial and risky; profits may not be realized for years. Careful planning, product development, marketing, and appropriate staffing for a profit-making venture can generate substantial net revenue after an initial investment phase, provided initial profits are re-invested in the business.

Opportunities of Profit-Making Ventures

• Use of funds raised is not restricted
• Charitable registration is not required for either the parent organization or its members
• Creates awareness and reaches new potential members and supporters
• Decreases reliance on traditional funding sources by targeting consumer markets
• May achieve compatible goals such as economic development for women and environmental benefits
• Structure can be simple and not bureaucratic
• Potential for revenue is high, given a substantial start-up investment and people with expertise to run the business
• Could capture the imagination of women involved in running businesses and thus create a volunteer base of expertise
• Targets consumer markets versus donor markets

Challenges of Profit-Making Ventures

• Requires substantial start-up funds and possibly years of work before profits realized
• Large risks involved
• Requires expertise not normally associated with women's organizations
• Revenue-sharing mechanisms may be complex and cause conflict
• Creates tension between profit-making purpose of business and larger mission of parent/member organization
• Members may object to the emphasis on consumerism inherent in the venture
• Profit-making objective may be compromised by other values (such as training)
• Revenues fluctuate with the economy and competition

Women's groups should develop a profit-making venture as a secondary collaborative activity to raise revenue.

• Women's groups should explore the possibility of developing an independent revenue base from the sale of products or services. The final product or service line may be more successful if it matches with women's values
• The primary objective of a profit-making venture developed by women's groups should be the generation of net revenue, and therefore it should be run on the principles of sound business management
• Other objectives (such as economic development of women) can be included, but as secondary objectives

Chrow

Gibson

Omidvar