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Just don’t do it until you have read what I have to offer…. Ultimately, the answer is not always in reinventing the wheel. Often it is in finding someone who is already spinning it and seeing if you can help push if harder and further.

Did I get your attention? I hope so – because if you, a loved one, a business partner or a community group are even considering registering a new charity in Australia in the next 12 months I implore you to back away from the idea. Just don’t do it until you have read what I have to offer.

It’s not that I doubt your desire to do good. It’s not that I doubt you have spied a need you think needs addressing or that I doubt that you have the passion, drive and motivation to get it done.

It’s just I think that, in the absence of any natural market forces, the not-for-profit and charity sector in Australia has gotten to a point where the sheer number of organisations is far too big for our small community to sustain and ultimately there must be more duplication and wasted resource than there is innovation.

Frighteningly, 221 new charities registered with the ACNC in August alone!

 

Rather than just taking my word for it though, lets look at the numbers.

While exact figures in this area can be difficult to lock down, in 2010 the Australian Government’s own Productivity Commission estimated  there were around 600,000 not-for-profit organisations registered in Australia. Yes – that is a 6 followed by 5 x 0s!

Of these 59,000 were classed as being “economically significant”, contributing $43 billion to the Australian GDP and employing 8% of the community (in 2006 – 07).

When you consider our national population is only just over 23 million, that is a staggering number of organisations that are reliant on “public goodwill” for their funding and provision of service.

I would argue it looks like we are slowly but surely building a  massive industry that, in all likelihood, is currently perpetuating duplication of services and missions rather than striving for improved results through cooperation, collaboration and innovation.

Granted – I acknowledge NFPs and charities are actually quite different. Afterall, one generally relies on public grants while the other relies on public donations.

Regardless – each type of organisation exists in its own right to return some form of good to the community at large. As such, while I don’t love that we tend to group them together, I understand that by fundamentally working in common areas it makes sense to categorise their existence into a  single sector.

Fast forward to August 2015 then and the Australian Charities and Not-for-profit Commission (more commonly known as the ACNC) has just over 53,000 registrations on its database. Frighteningly, 221 new charities registered with the ACNC in August alone!

Why do I say this is frightening? Because from where I am sitting, I would argue it looks like we are slowly but surely building a  massive industry that, in all likelihood, is currently perpetuating duplication of services and missions rather than striving for improved results through cooperation, collaboration and innovation.

Indeed the lack of what I would call “natural market forces”, ie competition around price, product and position, means that just about anyone can establish and promote a charity while few are forced to regroup, consolidate or close. When was the last time newspaper headlines screamed of a “factory clearance” for a charity? Or headlines spoke of a charity CEO being forces to step down because of “shareholder dissatisfaction”?

 

…if there was just one thing I could do to help improve charitable outcomes across Australia it would be to put a moratorium on the registration of any new charities for at least the next 12 months.

Put simply there are few barriers to entry in the first place and this creates a situation where opportunities to collaborate are completely overlooked in preference for “setting up your own”.

While it may seem like a harsh statement then, if there was just one thing I could do to help improve charitable outcomes across Australia it would be to put a moratorium on the registration of any new charities for at least the next 12 months.

Instead I would encourage anyone interested in doing public good to a spend a significant amount of time researching the existing environment. Is there someone out there already working in this space – carrying the overhead costs that come with running any existing business and building the connections you would need to get the job that you see that needs doing done? Even if they are not specifically working on the opportunity that you have identified – are they targeting the same consumer group? Are they reaching into foreign markets where you would like to see good done? If yes – what can it hurt to approach them and talk to them about your idea.

Ultimately, the answer is not always in reinventing the wheel. Often it is in finding someone who is already spinning it and seeing if you can help push if harder and further and if you need help doing that we are here to help.

Yours in creating exciting new opportunities for our communities

Kylea

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