The Power of Financial Storytelling for Nonprofits
The Lehigh Valley Community Foundation held Coffee & Conversation: Financial Storytelling in Uncertain Times on February 24 at Northampton Community College, Fowler Center. The workshop was presented by Tisha Hyter, CSRIC®, Director of Nonprofit Strategy at PNC Institutional Asset Management. Erika Riddle Petrozelli, CPA, CAP®, LVCF President and CEO welcomed the group of more than 60 nonprofit representatives, Terrence A. McMahon, CIMA®, Senior Investment Advisor, PNC Institutional Asset Management, introduced Tisha Hyter, and LVCF’s Robyn Weaver, Program Officer for Capacity Building offered closing remarks. Below is a summary of some of the recommendations from the presentation.
Effective financial storytelling is a crucial tool for nonprofits seeking to communicate their impact, justify funding needs, and engage stakeholders. A well-crafted financial story can turn data into action, demonstrating the organization’s role in addressing critical community challenges while ensuring financial sustainability.
Define the Challenge
To build a compelling financial story, nonprofits should start by clearly defining the problem they aim to solve. This involves using relevant data—such as census reports, economic trends, and internal assessments—to highlight the scope and urgency of the issue. Stakeholders need to understand why the nonprofit exists and why their support is necessary.
Describe the Approach
Next, nonprofits must articulate their approach. Every organization has a unique method for addressing challenges, whether through direct services, community partnerships, or policy advocacy. By outlining specific strategies and leveraging reputational, human, and financial capital, nonprofits can differentiate themselves and showcase their effectiveness.
Showcase a Track Record
Demonstrating a history of success is essential. Nonprofits should present key performance metrics, financial strengths, and past achievements to build credibility. This can include growth in program reach, financial stability, or successful fundraising initiatives. By showing effective resource management, organizations reinforce trust with funders and donors.
Measure and Communicate Impact
Impact measurement is another critical component. Using both quantitative and qualitative data—such as the number of individuals served, program outcomes, and beneficiary testimonials—nonprofits can provide concrete evidence of their effectiveness. Tracking impact over time and aligning results with donor expectations further strengthens the case for continued support.
Make a Clear and Data-Driven Ask
Finally, making a clear and well-justified funding request is vital. Nonprofits should present the full cost of delivering services, projected future needs, and how additional funding will expand impact. Providing a well-researched funding ask, backed by financial data and sustainability plans, helps donors see the direct value of their contributions.
Conclusion
By following these steps—defining the challenge, describing their approach, showcasing a track record, articulating impact, and making a direct ask—nonprofits can craft compelling financial narratives that resonate with donors, grantmakers, and stakeholders. In an increasingly competitive funding environment, strong financial storytelling is not just beneficial; it is essential for long-term success.
See the photos from the workshop below from LVCF’s Flckr Gallery
