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“Yes, M.A.M.” – The Case for Saying Yes to Mergers, Acquisitions, and Meaning

Peter Deitz Peter Deitz

The following is a guest post by Peter Deitz. In 2007, Peter founded Social Actions, an initiative that helps people find and share opportunities to make a difference. In March 2011, GuideStar acquired Social Actions. Peter is based in Toronto, Canada.

The origins of this blog post can be traced back to the 2010 Skoll World Forum, hosted every year at Oxford University’s Saïd School of Business.

At one point during the Forum, I found myself speaking with a senior leader in the nonprofit sector. He could sense the frustration and isolation my colleague and I were encountering in our effort to turn Social Actions into a sustainable stand-alone organization.

His advice to me over a crowded room: “You need a marriage.” I was surprised he took the conversation in that direction, and my reaction must have made this clear. When he realized I had misheard, he clarified, “A merger, not a marriage, although both might help in your case.” We laughed.

That exchange set in motion a yearlong process that eventually led to GuideStar’s acquisition of Social Actions, a move that I welcomed at the time, and have since grown to appreciate even more.

Since March 2011, the work of Social Actions has been carried out by talented staff at GuideStar, an organization that is incredibly well suited to deliver on the project’s mission.

For my part, I have been freed up to find renewed meaning and new opportunities within a deeply held belief that technology-enabled philanthropy practiced well can produce remarkable outcomes.

Somewhere along the journey of co-creating Social Actions, this belief — while never extinguished — had reduced to a flicker as the demands of managing a group effort mounted.

Social Actions, like many young organizations, had succumbed to what Clay Shirky describes in Here Comes Everybody as the institutional dilemma:

[Every] institution lives in a kind of contradiction: it exists to take advantage of group effort, but some of its resources are drained away by directing that effort. Call this the institutional dilemma — because an institution expends resources to manage resources, there is a gap between what those institutions are capable of in theory and in practice, and the larger the institution, the greater those costs.

In our case, even with a very small team, the resources expended were exceeding the resources managed and created. And while a larger institution would come up against greater costs, they would also have longer horizons to resolve the inherent tension between the expanding and managing of resources (in Shirky terms) on a per project basis.

And so, after much consideration and courtship, Social Actions was transferred to GuideStar. In the months that followed, my attention was squarely on ensuring that GuideStar’s team received the project-specific knowledge and know-how required to maintain and expand Social Actions.

With the help of GuideStar staff and my long-time colleague on Social Actions, Christine Egger, we documented all of the systems, formal and informal, that had become routine and may be required in the future. We also engaged in a thorough exploration of what new directions GuideStar might choose to take Social Actions, factoring in mission-alignment, possible market opportunities, and strategic considerations.

Two feelings struck me at the time.

First, it was deeply satisfying to at least attempt to codify what made Social Actions unique and map out scenarios for the future without the weight of knowing Christine and I would be directly involved in the execution. This work would be taken up instead by equally capable hands backed by the stability of an organizational home many times larger in magnitude and reach than Social Actions had known.

Second, I started to feel a strong sense of participating in something much larger than either Social Actions or GuideStar, like a relay runner on a course with infinite baton passes and little or no distinction between teams. Placing Social Actions firmly in new hands freed up my own to take another baton, perhaps of a similar shape and size, or perhaps entirely different.

For the first time in five years, I found myself contemplating what might follow my work on Social Actions. I started asking myself all kinds of big questions, including those found in books like Jim Collin’s Good to Great:

What am I (still or newly) passionate about?

What am I good at? (Or what have I become good at?)

What can I make money doing (since “just getting by” is no longer sufficient)?

These and other questions take time to answer. And yet, they are critical to consider every so often in order to restore and renew meaning in one’s work.

Pairings along the lines of Social Actions and GuideStar — as well as others that have been announced in the past year — free up the founding teams of socially minded projects to ask themselves a range of questions on how best they might channel what they care deeply about into new and worthwhile pursuits.

The sustaining and scaling phases of a social venture look quite different from the start-up phase, and often require different skill sets to execute well. For people like me, who are drawn to the start-up phase, handing the organizational baton once formed to a larger entity can be best for the founders and best for the communities and people the project impacts.

This model permits founders to return to the work they find most meaningful (for whatever unusual combination of personal attributes) and permits larger organizations to sustain and scale innovative projects that they may not have been able to create on their own.

All this to say, mergers and acquisitions in the nonprofit and philanthropic sector can be incredibly positive developments, and not only for the reasons one usually hears. Eliminating redundancy, improving efficiencies, and reaching scale are all nice.

But nothing beats more meaning.

Topics: Trends