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That's not necessarily true, because revenue can be a poor measure of capturing value and scale in organizations that are mostly volunteer. If that individual
by crazygringo 2y ago
That's not necessarily true, because revenue can be a poor measure of capturing value and scale in organizations that are mostly volunteer.
If that individual is managing the process of successfully getting 1,000 people who volunteer 15 hrs/wk, which you'd otherwise have to pay let's say $30/hr including taxes, then that would be the equivalent of $22.5 million in annual revenue.
Suddenly $285K in executive compensation looks perfectly fine.
In some mostly-volunteer organizations, you will find that most of the money pays the professionals at the top, because you can't get that necessary expertise any other way.
I worked at one once right out of college, at the bottom of the full-time-paid rung, and I had interestingly conflicted moral feelings about it. I spent a lot of time with volunteers and yet I was being paid. But I needed a job, I needed to pay rent. And the tech skills I was providing literally none of the volunteers could do. It made me question whether it was "fair" that all these people's monetary donations were going to paying my salary. But then again, I wasn't the one who set rents to be as high as they were in the city where the organization put its headquarters, and student debt doesn't get forgiven just because you work for a nonprofit.
- cmcaleer 2y agoYour job as the top executive isn’t to get labor, it is to run a company (which sometimes involves getting labor). In order to do that you must manage your expenses. If you overspend on your salary such that you put the company in a position where the company is begging for 4 months of your salary as runway, you have failed at your job and you demonstrably were irresponsible, reckless in your spending and unable to make tough choices to ensure survival. In other words, you were not worth $285k.
- crazygringo 2y agoThat's not necessarily true at all. Sometimes organizations simply wind up in impossible positions. Funding dries up for macroeconomic reasons that you have no control over, demand patterns change, etc. There are plenty of failed orgs that would have failed even if they'd had true business geniuses leading them. You could just as easily assert that paying someone $285K got the expertise that kept the organization going for an extra 3 years than it would have otherwise, because someone with less expertise would have made a bunch of worse choices that it would have run out of money 3 years earlier. You seem to be demanding some kind of divine level of perfection here.
- cmcaleer 2y agoIf you don’t see paying yourself $285k in Nashville when your non-profits revenues are less than $2MM as anything other than totally reckless (at best), I have no idea what to say to you. She chose to pay herself that with full knowledge of the financial situation of her 17-year long non-profit.