Yes, I did write several months ago that heavy reliance on a single donor - whether individual or corporate - was a very risky proposition for a nonprofit organization.
At the time, Wall Street had just begun to report significant decreases in corporate earnings. In that post, I detailed several organizations that had relied on Bear Stearns (and the firm's partners) for the majority of their fundraising revenue. {Side note - the blog software used by CommunitEy stores only the most recent 20 entries, so I'll try to resurrect the earlier posting ... maybe tomorrow]
Now the "aha" moment has occurred for some other nonprofits: DonorsChoose, for one. The organization had significant startup funding from Lehman Brothers, with a pledge that should cover approximately 7% of the organization's budget. Seven percent can be recouped with a lot of extra effort - but when you're opening up new markets, as DonorsChoose has been, it can be devastating to growth. $500,000 a year is nothing to be cavalier about - it is still, for nearly every nonprofit, a big amount of money.
I'm hoping that the pledge is from the firm's Foundation, not a community affairs budget. With the bankruptcy filing, there won't be any corporate giving. It's funny, but the debt-holders usually aren't really generous during bankruptcy. Trust me, been there, done that, have the WorldCom t-shirt to prove it.
So early today, Bloomberg had an online article "After Lehman: Nonprofits Brace Amid Bankruptcy." Pretty muc what you'd expect, under the circumstances.
I hope those organizations that counted Lehman as a "big giver" have their contingency plans in place - because making up those dollars will take a lot of effort.
If you have a spare dime, maybe you should send it to one of these organizations. They probably are going to need it.
