Inspiring Capital is a consulting firm that facilitates the growth of purpose-driven organizations with the understanding that these firms typically do not have the bandwidth or the right skill-set to get critical projects done. They primarily specialize in four areas:

• Impact Metric Evaluations
• Earned Income Strategies for not-for-profits
• Operations, Marketing and Growth Strategies
• Business development and Financial Modelling

I was a part of Inspiring Capital’s flagship program – the 10-week MBA Fellowship, now in it’s sixth year. The fellowship pairs MBA graduates with social ventures on short-term consulting projects specifically designed to produce real, measurable impact while giving the fellows direct management experience, develop a deeper understanding of the social sector as well as extend/build a network in the space.

My client, LEAP, is an arts education non-profit based in NYC. Their mission is to design and implement arts integrated educational programs in schools underserved in the field. LEAP’s 4 C’s – Critical Thinking, Creativity, Communication and Collaboration are aimed at equipping the youth with the right set of 21st century skills that will enhance foundational knowledge applied to everyday tasks and build competencies to take on complex challenges, while evolving socio-economic and emotional character qualities.

My specific role through the summer was to support LEAP as they transition their finance function in-house, develop a set of metrics to measure operational effectiveness & conduct due diligence on a potential merger.

The organization is at an inflexion point where its current ~$10M budget is just enough to carry out the existing programs and in order to expand, LEAP needs to:

• Diversify and grow revenue streams
• Streamline operations to support increased scale

Aligned with the above objectives, I drew on my experience in audit and corporate finance roles to critically evaluate the potential acquisition target conducting financial due diligence, assessing product integration fit and identifying revenue/cost synergies. The finance classes I took during my first-year aided my efforts in building out a robust 3-statement financial model for my client. Backed by our detailed research and evaluation, the acquisition pitch was unanimously approved by the Board of Directors positioning the organization to increase revenues by 1.5x and increase profitability exponentially by having a diversified and unrestricted revenue sources that the acquired company would bring to the table.

Further, having looked at the finance function of companies both top-down as an auditor and bottom-up as a finance manager, I was able to support the management’s efforts in overhauling their finance operations transitioning from an outsourced service provider to building a robust internal team to iron out operational inefficiencies such as: inefficient budget management, revenue leakage, expense overage, transparency and planning, cash flow mismanagement, and sub-optimal compliance procedures.

One of the biggest challenges I had to overcome was working with ambiguity. As is the case with most not-for-profits, they lack the sophistication and structure of large corporations due to limited resources and mission-driven goals which are often hard to measure and quantify. A thorough research of the not-for-profit landscape, with a focus on organizations that have education as their mission as well as on past deals and the unique metrics of success/failure for organizations of this nature helped me familiarize myself with problem and find solutions.

I learned a lot this summer. Other than learning to work with ambiguity, I realized how much more important it is for non-profits and social enterprises to be financially sustainable. As many as 40% of the organizations have virtually no cash reserves and ~1/3rd receive 90% of their funding from the government i.e. restricted cash, low margins, volatile subject to policy changes and political landscape, thus making these organizations risky from a going concern perspective. The gap between funding required to achieve the objectives of poverty eradication, climate change, equal education, etc. is too large to be fulfilled by public dollars. Private investment in the sector is critical for success and organizations like Inspiring Capital are directly addressing some of these issues.

Further, we had weekly training days and workshops with some of the biggest corporations that are stepping up in this field such as IBM, Salesforce, The Rockefeller Foundation and UN Global Impact that helped demystify certain trending topics such as Impact Investing, Blockchain for good, Circular Economy and Sustainable business practices.

Another big takeaway for me was the personal development as a consulting professional – working with different stakeholders in a culturally-different environment. This was my first experience working outside my home country and it was interesting to identify differences in workplace settings as well as understanding and adapting to these changes. Overall, I feel better synced with the social impact space not just in the U.S. but across the globe in terms of critical issues and how some companies are implementing creative solutions to combat them that can be replicated/built in emerging economies.