Desperate times call for proactive measures. Nonprofits are navigating an immensely challenging economic and political context. Many find themselves thinking about the once-unthinkable: mergers, acquisitions, and sunsets.

Consider the global development sector. It faces immense uncertainty given the dissolution of USAID, reduction in bilateral funding, and broader political headwinds. One recent survey suggested that 60 percent of development organizations could close within six months. Matchmaking efforts are underway that create databases of organizations ready to consider recombination.

While there is particular urgency among global development organizations, the conversations around restructuring are spreading across the sector. This presents an opportunity for the field. Recombination offers a chance for creativity. Closure can be compost for what comes next.

The moment is undoubtedly dark. But if we act quickly, we could leave this crisis stronger than we went in—with robust organizations refocused on the most important aspects of their work, squeezing more good out of each dollar, and prepared to face the inevitable challenges to come.

Nonprofit Recombination and Structural Change

I have seen firsthand the power and the challenges of nonprofit structural change. As the CEO of GuideStar, I oversaw its 2019 merger with the Foundation Center to form Candid. This brought together the world’s two largest databases of information about nonprofits and philanthropy into a single entity. Fast Company called it an effort to build “the definitive nonprofit transparency platform.” Years later, Candid is in strong financial health, serving millions, and continuing to build out stronger information infrastructure for social change.

It was an immensely complex undertaking that brought together 200 employees across eight different offices. We distilled 70 products down to a handful of tools while maintaining the core value offered by each parent organization. Undoubtedly, we were blessed to act from a position of immense privilege. A coalition of foundations stepped in to provide $44 million in funding. We had years of runway to plan the merger, supportive boards, and a very clear value proposition.

Even with those advantages, I do not minimize the challenges of such an organizational restructuring. I bear scars and always will. But no one said the work of social change was easy. It is the job of leaders to do the hard things necessary to build better organizations that can help build a better world.

Read the full article about nonprofit recombination by Jacob Harold at Stanford Social Innovation Review.