Oil and water rarely mix: Exploring the relative stability of Nonprofit revenue mixes over time

Simon Teasdale

This paper explores whether nonprofits are increasingly adopting mixed revenue strategies, and the sustainability of these strategies over time. We constructed a panel using NCCS data from 1998 and 2007, and divided nonprofits into three groups: Commercial, Donative, and Mixed Revenue. We found no evidence that nonprofits are increasingly adopting mixed revenue strategies. Mixed revenue strategies appeared less sustainable over time than predominately commercial or predominately donative strategies. Our results suggest that for most nonprofits, relying predominately on either commercial or donative revenue (DR) is a more stable equilibrium than attempting to achieve a balanced revenue mix. Exceptions may be those nonprofits, such as arts organizations, where there is a natural alliance between donors and customers.

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