The NonProfit Times - July 1, 2008 - (Page 1)

The Leading Business Publication For Nonprofit Management • www.nptimes.com • $6.00 U.S. July 1, 2008 Time To Let Go BY MARK HRYWNA Sparks Flying From Blackbaud’s Founders, boards need to work together on transition Bid For Kintera BY PAUL CLOLERY D octors can’t write a prescription to treat Founder’s Syndrome, nor are they likely to diagnose it. It’s not visible, like a rash, or something audible like a cough. But nonprofits that have been around for even a relatively short time should be on the lookout for it. Founder’s Syndrome usually occurs when a founder is unwilling to step aside to make a clean break from the organization and the belief that only that person knows what’s best for the nonprofit, according to Linda Crompton, president and CEO of BoardSource, a Washington, D.C.-based nonprofit that publishes guidelines and policies about nonprofit governance and management. It usually occurs after the initial growth of a nonprofit, creating conflict between those who want the organization to adapt and a founder who wants to keep things status quo. Ruth J. Abram founded the Lower East Side Tenement Museum in New York City in 1988 and is undecided about whether she will remain on its board. “It’s kind of her decision and about her time commitment,” said Peter Campanella, a museum board member who co-chaired the search committee T Ruth J. Abram, founder of the Lower East Side Tenement Museum, speaks at the museum’s fundraiser earlier this year. to replace Abram with Arnold Kanarick. Abram, who was recently succeeded as president by Morris J.Vogel, could stay on the board in an honorary capacity if she chooses, Campanella said.“How active she wants to be will be up to her, but she doesn’t want to be involved in day-to-day operations.” She still can play a vital role from the standpoint of public relations, communications, and development.“We don’t want to lose that, but we also want to respect her wishes too,” he said. There was a lot of sensitivity among candidates about replacing a founder and board members understood the challenges involved, Campanella said. Some candidates were not interested because they didn’t want to replace a founder, particularly one who was highly regarded in the industry and in Time To Let Go, page 6 he spitting contest between fundraising technology software and service providers is officially engaged. Blackbaud’s offer of $1.12 per share for troubled Software-as-a-Service (SaaS) provider Kintera in San Diego caused varying degrees of hysterical reaction, funny and otherwise, from competitors, users and tech bloggers. The offer for Kintera continues the Charleston, S.C.-based Blackbaud’s ravenous appetite for gobbling up applications and competitors. During the past 18 months, the firm has spent more than $130 million to tighten its grip on the nonprofit software space. The company is expected to close the Kintera deal on or around July 2.The price is $46 million but with net operating loss carry-forwards, the price might be as little as $36 million for a firm with $44.9 million in revenue. The acquisition of Kintera would bolster a major segment of Blackbaud’s product line, the online content management and deployment Sphere® technol- Photo By Lou Manna ogy platform, which has a significant market share. Blackbaud has NetCommunity™, but it hasn’t gained the wide acceptance by users that Kintera and Austin, Texas-based Convio have garnered. FIRST SHOT Convio fired one of the first shots with an email message from Gene Austin, its chief executive officer. “Blackbaud now faces the task of addressing the wellpublicized operational challenges at Kintera, while rationalizing a roadmap that includes multiple eCRM and donor management products from four companies (Blackbaud,Target Analytics, eTapestry and Kintera). It will be interesting to watch this integration play out over the coming quarters and years,” wrote Austin. He was making reference to the fact that although it has approximately 4,000 customers and reported $44.9 million in revenue for 2007, Kintera has never made a profit.Founded in 1999,the company raised $40 million in its July 2003 initial public offering before beginning trading that December. By April 2004, it had reached an all-time high of $17.73 per share. On March 20, it hit a 52-week low of 20 cents per share. “My hope is that this acquisition will convince Blackbaud to listen and respond to the growing deBlackbaud’s Bid, page 7 ADVERTISEMENT Holiday Jeer Mailers preparing now to battle holiday season stad, assistant vice president of direct response operations anta Claus might be the only jolly person this holiday for the New York-headquartered organization. ALA had exseason. Those involved with direct mail fundraising perienced file erosion and decreased donations for several previous years. The ALA’s timecampaigns are feeling honored Christmas Seals tradithe heat this July as they tion helps the campaign and gear up for the holiday mailing more than half of the organizaseason.With an economic downtion’s revenue comes in the turn, last year’s and this year’s year’s fourth quarter. postage hikes and a presidential “Our file was built on Christelection to contend with, direct mas Seals,” said Finstad of the mailers are planning on conservdecorated stamps that celeative campaigns this year. brated the organization’s 100th The American Lung Associayear last year. ALA faced a nearly tion (ALA) had a banner year with holiday mailings during The American Lung Association (ALA) relies on their Christmas 15-year decline in file size, gross 2007, according to Craig FinSeals to renew donors during the holiday season each year. Holiday Jeer, page 8 BY MICHELE DONOHUE S THIS FRONT PAGE NEWS IS FOR YOU We’re increasing your bonus to $50 per active account. 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Table of Contents Feed for the Digital Edition of The NonProfit Times - July 1, 2008

The NonProfit Times - July 1, 2008 Time to Let GO Sparks Flying From Blackbaud's Bid For Kintera Holiday Jeer Contents Who...When...Where...How...What? The Wrong Arguments Calendar Measure the Unmeasureable Getting Good Advice We Barely Got to Know You Special Report: Giving USA Shows Bequests, Foundations Boosted Otherwise Flat Giving to 306 Billion Dollars National Benchmarking Nothing Is Forever Diversified Planet Business Briefs NPT Jobs Resource Directory Bridge Map Insert

The NonProfit Times - July 1, 2008

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