What Drives Nonprofit Entrepreneurship?

Abstract

Using survey data from a small sample of nonprofit agencies in the Detroit metropolitan area, this article examines the rate at which nonprofits adopt earned income strategies. For the purpose of this analysis, efforts to generate earned income are described as “entrepreneurial” and measured through product sales, enterprise development, and assessing fees for services. A number of factors are thought to influence the adoption of these activities, including budget cuts from government sources, declining revenues from private donors, board composition, staff hours devoted to marketing and public relations activities, having a secular orientation, and agency size. Findings indicate that larger organizations and those experiencing reductions in funding from government are more likely to adopt entrepreneurial measures. Organizations with a religious affiliation and those experiencing declines in private contributions are also more inclined to pursue these approaches.