“LivePlan gave us that polished, organized look that we needed to rise above the traditional view of service-based nonprofits.”

Located in Oregon's second-largest metropolitan area, Kids FIRST has been finding its way. Spun off from the county government as an independent nonprofit in 2017, they pursued grants while providing services to around 700 child abuse victims every year.

For Finance Director Megan Jones, it was becoming clear that the standard nonprofit financial model of relying on grant funding would not be sustainable. Mainly if they wanted to add personnel, more advanced screenings, and mental health services to children needing help and healing.

“Our team of service providers works hard at making sure children don't slip through the cracks in a child abuse investigation,” says Megan. “It inspires me daily to see the collaboration between child welfare, law enforcement, and schools for children who may be victims of abuse. They work tirelessly to keep children safe. That is a motivating factor to work to support that mission's success in a fiscally secure way.”

Megan, along with Kids FIRST Executive Director Sarah Stewart, and board of directors members such as Palo Alto Software's Kathy Gregory, realized that to find more fiscal security, they needed two things: A bigger building... and a better plan.

They also needed to demonstrate solid financials in a way that made sense to whichever audience they were presenting to, whether it be their board of directors, potential donors, or potential lenders.

“A lot of businesses don't have to show their plan and numbers to anyone,” says Megan. “But nonprofits regularly do.”

Could a local nonprofit find funding beyond state and federal grants?

Megan came to Kids FIRST in 2017 with experience as a bookkeeper and small business consultant, along with ten years of professional experience in social/behavioral research and data analysis. She settled into a new nonprofit with ten employees and occupied a 3,000 sq. ft. building. Nearly all funding, especially for personnel, came from grants.

“We had just started to grow a new medical program in addition to the advocacy and forensic interview intervention, and that opened up the opportunity for diversification of income from medical assessment reimbursements,” says Megan. “Almost a year in, our building lease reduced our square footage by half and gave us a year to find another location.”

“The most difficult piece was proving that we had a future of new and reliable income streams.”

The team forged ahead by trying to secure bank loans to purchase a larger building, but they were turned down. The banks said they simply couldn't see how Kids FIRST was going to have a reliable financial path.

“We already had established a strong history of State and Federal grant funding,” says Megan. “The most difficult piece was proving that we had a future of new and reliable income streams. If we wanted to purchase a building, we needed to show that we could achieve sizable fundraising and medical insurance reimbursement income that wasn't restricted to grant funding objectives.”

Creating financial forecasts for banks and presenting better data to the board through LivePlan

A consultation with the Nonprofit Finance Fund showed the Kids FIRST Board of Directors that financial stability would need to come from more than just grants.

“That directed the strategic plan to increase medical billing revenue and fundraising dollars,” explains Megan. “It wasn't until the need to find a new home did it become evident. We needed a way to plan profits and cash flow internally, with our Board of Directors, and to present the organization's future fiscal potential externally to potential donors for our capital campaign and to achieve financing for a building loan.”

“To have LivePlan was really helpful to move through how actual cash flow was impacting future forecasts.”

To receive and retain accreditation and be approved for government-backed loans, nonprofits must have a written strategic plan and business plan. To assist with this effort, Kathy Gregory, program manager and director of product marketing for Palo Alto Software, was approached to join the Kids FIRST Board of Directors.

She immediately demonstrated how LivePlan could give Kids FIRST the tools it needed. Not just for growth and strategy but to make a convincing case to banks.

Just as a for-profit business could use LivePlan's Pitch and Forecast tools for strategic planning, Kids FIRST, as a nonprofit, could use those same tools to tell their story and craft a compelling, detailed business proposal for potential financiers.

Megan began working with the Forecast tool to “pull levers,” or modify revenue and expenses to see how it affected the financial forecast. In LivePlan, she could model how different scenarios could affect what building and operations Kids FIRST could afford. LivePlan also helped Megan balance the timing of hiring new personnel and fulfilling up-front building investments with the expected cash flow from medical reimbursements and fundraising.

“Those were moving targets,” says Megan. “To have LivePlan was really helpful to move through how actual cash flow was impacting future forecasts.”

Crafting a compelling nonprofit financing pitch via LivePlan

Kids FIRST began examining and using the full scope of LivePlan. They tested use cases, developed a pitch, crafted a full traditional business plan, and created a forecast to present to lenders. Now prepared with a LivePlan-created Pitch and Forecast, Kids FIRST began approaching potential lenders again.

“We submitted the LivePlan proforma to three banking institutions,” says Megan. “Only one institution denied exploring our loan options further.”

“LivePlan gave us that polished, organized look that we needed to rise above the traditional view of service-based nonprofits.”

The forecast not only showed the board of directors how feasible the building was but also convinced two other banks. Kids FIRST ultimately moved forward with their current banking institution, but they secured more than the building loan—at competitive rates. Their bank also worked with them on pursuing a route for SNAP Bond Financing.

Through this program, nonprofits can complete the loan process in as little as 8-10 weeks for projects with an estimated cost of $500,000 - $20,000,000. Qualifying for this Oregon nonprofit financing program further reduced Kids FIRST's loan interest rate by one percent.

“LivePlan gave us that polished, organized look that we needed to rise above the traditional view of service-based nonprofits,” explains Megan. “We had a three-year forecast of ‘hopeful’ medical reimbursements. So, we needed to demonstrate to a lender that we had a solid analysis of our potential and the backing of our Finance Committee and Board of Directors for that major decision.”

Megan also views the LivePlan proforma as helping Kids FIRST reach the next stage of applying for SNAP Bond Financing, which went before a board of directors on behalf of the Oregon State Treasury.

“By working through the exercises of the Pitch for our language and story and the Forecast for our numbers and viability, I believe we felt confident in our own abilities to achieve this major accomplishment,” says Megan. “It was kind of a big deal! And I felt that we passed with flying colors.”

That approval helped ensure Kids FIRST's future. Leaving behind their former 3,000 sq. ft. space, the nonprofit tripled its square footage. Expanding from ten employees to eighteen, Kids FIRST now calls home a 9,000 sq. ft. facility, where they can continue to help area children, while also developing more programs and services.

LivePlan now helps Kids FIRST manage day-to-day planning, long-term strategy, and new needs

Sure, it's one thing to win the victory of securing a major bank loan and putting down roots where a vital nonprofit can grow and thrive. But daily operations still need planning and managing too.

Today, LivePlan continues to support Kids FIRST. Ongoing and iterative forecasts help the Kids FIRST team manage their nonprofit day-to-day and via long-term strategic planning.

“Not all positions produce revenue, so those pieces really come together in the LivePlan forecasting visuals.”

“After the building acquisition and renovation period was complete, we have begun to establish a pretty predictable ‘cost of living,' says Megan. “We moved in right before COVID hit, so it was really helpful during that period of uncertainty to estimate what impacts closures and grant budget cuts might have.”

Along with helping Kids FIRST weather the pandemic and short-term planning ups and downs, LivePlan helped the nonprofit maintain good cash flow and assets. Now, the team is focused on another big need: more people.

“Our staff growth is needed in every area: medical, forensic interviewing, advocacy, management, and administrative,” explains Megan. “Not all positions produce revenue, so those pieces really come together in the LivePlan forecasting visuals, specifically as it pertains to staff hiring timelines and revenue possibilities and timing.”

LivePlan conveys the right amount of detail to the right people

Ultimately governed by the board of directors, a nonprofit such as Kids FIRST also needs to get the right information to those key decision-makers.

Megan suggests that nonprofits can get the most out of LivePlan when they are setting up information and know who that presentation or summary is for, such as a presentation to the board of directors, lenders, or donors.

“LivePlan works great when you have a strong charter of accounts, and you know what information is important.”

“It's important to think about your groupings and your mappings. Maybe you don't need to make it complicated,” she explains. “LivePlan works great when you have a strong charter of accounts and you know what information is important. Don't show too much detail. Get to the bigger picture.”

LivePlan has made it easier for the Kids FIRST Board of Directors to review the information and make strategic decisions too. Megan used to hand out a QuickBooks balance sheet, the current P&L, and a comparison of the budget to actual income and expenses.

“I could see eyes glazing over.”

Presentation and summary tools make LivePlan reports engaging for decision-makers

Now, more concise presentations and visuals have helped Megan provide the board not only with what they need but what they can best use to move Kids FIRST forward.

“Summarized graphics gave them a better sense of what really mattered,” says Megan. “They appreciated having the finances simplified. That makes it nice when you're in a position where you have to regularly present financial data to a board of directors.”

“They appreciated having the finances simplified.”

Now Kids FIRST is looking at services it can add, such as more comprehensive mental health services for children affected by crimes such as child abuse. However, in order to do that, Megan needed a solid look at cash flow. Instead of needing to develop tools and formulas on her own, she could leverage the tools inside of LivePlan.

“Once we could get the building, there was also the cost of renovations, which were more than the cost of the business,” she explains. “A year into that project, our cash flow looked better than we had projected. We also have to consider long-term pledges and medical reimbursement.”

Being able to target the right presentation of data and story to the right people is helping Kids FIRST grow not only its services but its profile with potential supporters.

“We've established ourselves as successful, and more people want to help us,” says Megan. “We have foundations who want to see grants we are sending to the federal government, who may want to fund us. Having a strong financial background makes people feel more comfortable with your nonprofit.”

Board and team members can make strategic decisions together

“The Kids FIRST Board of Directors now starts every meeting with a review of the LivePlan Dashboard, then the Live Forecast view and revenue lines,” says Kathy Gregory. From there, the board can have more productive strategic conversations that move Kids FIRST forward in its mission of helping kids. Using LivePlan throughout the organization has helped the team, and the board be strategic together.

With Megan's small business background, using LivePlan has reminded her of how a business planning mindset works not only in the for-profit world but in the nonprofit realm as well. Through LivePlan, Megan can tell a story that relates numbers and business facts—such as personnel costs or the number of medical exams performed in a given year—to why that matters in the real world.

“We're doing advocacy work for these children, invest in us, and we'll continue that good work.”

That impact comes to life in real-world numbers too. According to Kids FIRST's 2018–2019 Annual Report, the nonprofit saved 630 children in abusive situations, conducted 520 forensic interviews, completed 232 medical assessments, and participated in 62 grand jury hearings.

“The collective ‘we’ would love to see child abuse end,” says Megan, “but the truth is, it hasn't.”

Kids FIRST need solid planning and secure financials to continue helping kids who have been victimized by abuse. That understanding drives Megan through every story she tells through LivePlan.

”Whether grants or donors or contracts with Medicaid reimbursers, how do we tell a story for why we should be compensated for certain services?” says Megan. “That's the mentality I've brought: Invest in these kids. A lot of our revenue has gone into assets. We want you to invest in us. We're doing advocacy work for these children, invest in us, and we'll continue that good work.”

Toll-free crisis hotline numbers are available at ChildWelfare.gov. Kids FIRST serve Lane County and Oregon; you can get involved or donate at KidsFIRSTCenter.net.