Salesforce’s Rocky Revolution In the Nonprofit Space – A History (Part 1)
Salesforce’s entry into the software market sparked a CRM revolution in the commercial space, and its entry into the nonprofit space was no less of a disruptive event. The Salesforce revolution has an eventful history and continues to unfold in interesting ways for nonprofit organizations.
This article is Part 1 in a three-part series. See the series introduction for links to all three posts.
In the beginning
Since Salesforce started in 1999, it has practiced an innovative model of philanthropy termed the “1:1:1 model.” In that model, it donates 1% of revenue to charity, 1% of employee time to volunteerism, and 1% of its technology to nonprofits.
The 1:1:1 model was born, for Salesforce’s co-founder and CEO Marc Benioff, in 1997 at The President’s Summit for America’s Future.
Marc was moved to action by General Colin Powell, who said, “This is a time for each and every one of us to look into our own heart, to look into our own community, find someone who is in need, find someone who is wanting, find someone who is looking up to us, and for each and every one of us to reach down, to reach back, to reach across, to lift up a fellow American and put him on the road to success in this wonderful country of ours. We can do it.”
This created a tipping-point that forever changed Marc’s view of the role the corporate community plays as an accelerator for the nonprofit community.[testimonial author=”Marc Benioff, Salesforce.”]“If you really want to have a company that has a philanthropic orientation, it needs to not be a bolt-on… it needs to be integrated.”[/testimonial]
You may be wondering what the 1:1:1 Model means for nonprofits in real terms. Consider the revenue Salesforce receives from customers like GE, Virgin America, and American Express. The company has created a veritable cash machine that is capable of developing best-in-class applications. In turn, they can literally give away, or steeply discount, those applications to nonprofits.
Salesforce’s support for nonprofits has changed at a rapid pace. Sometimes for the good. Other times, not so much.
The Nonprofit Starter Pack
Salesforce is a platform with a core set of applications built to support the needs of the B2B (business-to-business) community. As originally designed, it did not have things that nonprofits commonly rely on—like gifts, households, or even individuals. When you’re a business selling to a business, these things aren’t important.
Think of a pile of LEGOS with which you can build whatever you want—as long as you have the right pieces. Out-of-the-box, Salesforce doesn’t have LEGO pieces for charitable revenue, memberships, donor restrictions, tickets, etc.
Enter the Nonprofit Starter Pack (NPSP). Built by the Salesforce Foundation (which last year transferred its nonprofit software business to salesforce.org), the NPSP tried to address some of Salesforce’s gaps.
The Nonprofit Starter Pack is free to nonprofit 501(c)(3) organizations. By comparison to its CRM competitors, the Nonprofit Starter Pack was for a long time a side-project of the Foundation. And the result was software that served only the smallest nonprofit organizations—and not particularly well.
(Just last week, Salesforce.org announced a rebranding of The Nonprofit Starter Pack to The Nonprofit Success Pack. The re-branding comes nearly a year after the Salesforce Foundation announced the release of the Nonprofit Starter Pack version 3.0, which benefited from additional investment of time and effort. More about this later in our series.)
NGO Connect: A massive marketing push
NGO Connect was launched in 2014 as “a new app that helps nonprofits connect all of these things [fundraising, event management, volunteer management, nonprofit relationship management, program management, and social management] to transform how they build and retain lifetime relationships with their constituents.”
At the core of NGO Connect was a partnership between the Salesforce Foundation and a leading Salesforce application provider, roundCorner.
What NGO Connect actually is, or was, has never been entirely clear. We’ve ultimately concluded that NGO Connect was a big marketing effort to promote an “app” that never existed in reality. As it turned out, any bundle of apps serving a particular nonprofit (particularly one focused as a “customer success story”) could be called “NGO Connect.”
roundCorner received an investment from Salesforce and its product, roundCause, became the preferred application of Foundation account executives. We were pleased that there was investment made in a product to support nonprofits, and the promise that went along with that investment.
Two years ago, we were caught up in that promise. Our frustrations were bubbling over with the stagnation of Blackbaud at that time. We were eager to see a well-funded competitor develop new products for the nonprofit community and to also spur existing nonprofit software providers to up their game.
However, the partnership between the Foundation and roundCorner did not last more than a couple of years. Speculation has swirled around what caused the partnership to end. We believe that both the Salesforce Foundation and roundCorner, for different reasons, were unable to deliver a fully usable and stable product that was supportable by the Foundation.
There’s more learning to be done
There is a common mistake among newcomers to the nonprofit space, and Salesforce often seems to fall victim to it: believing for-profit experience directly translates to how nonprofits work.
Managing relationships for nonprofits is complicated. And charitable transaction management has a high-level of complexity and high volumes. Nonprofit complexities are not self-created, and are not a byproduct of ignoring “how things are done” in the for-profit space. Constituents create, and demand, these complexities by the very nature of their relationship, and nonprofits must rise to meet the needs of these constituents.
History is littered with examples of vendors, implementers, and consulting firms that fail on nonprofit projects because of a lack of sector experience. We believe Salesforce failed to understand the complexity and sophistication required to manage a nonprofit organization.
People have both strong positive and negative reactions to Blackbaud—and both are valid. But for years, their software has defined the state-of-the-art in nonprofit functionality (albeit not always usability) precisely because they built that capability over decades. It is a difficult gap to bridge in a short period of time.
Salesforce has had a rocky start on the road to revolutionizing nonprofits. They are still learning how to work with, and on behalf of, the organizations they serve. They are still learning the nuances of how nonprofits work and think. We are seeing signs of maturation, but have sometimes found them overly self-assured and lacking the depth of experience to allow them to serve nonprofits effectively.
We are hopeful that the newly formed Salesforce.org will help address those challenges.
In Part 2 of this series, we write about (and visually illustrate) the many decisions facing a nonprofit considering Salesforce. Having the right approach to Salesforce helps ensure success on the platform.