Turning a Franchise Business Into a Nonprofit? Here’s How It’s Done.

Picture Credit: Courtesy of Challenge Island

Can a solitary franchise spot be transformed into a nonprofit?

That’s what Jamie Trujillo wondered only two months immediately after becoming a Challenge Island franchisee. The issue came from her deep sense of mission. Trujillo had usually been what she calls a “stereotypical teacher’s pet,” and put in 14 several years doing work with an adult education and learning nonprofit. Then she found out Challenge Island, an soon after-school STEM program for youngsters with about 140 spots in the U.S., and grew to become a franchisee in Albuquerque, New Mexico, in 2019. “It was an growth of my calling,” Trujillo states. But she shortly identified an age-outdated difficulty: Her programs had been too expensive for the young children who necessary it the most.

Trujillo could think of only one particular solution — to convert her enterprise into a nonprofit. Challenge Island agreed to support her, and she is now the company’s only franchisee with nonprofit status. Listed here, she explains how that final decision unleashed her business’s true potential.

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Wander us through the procedure of receiving nonprofit status.

So, the very first phase was to obtain volunteers for our board. Then I drafted our nonprofit bylaws, and submitted for nonprofit status with the Secretary of State and the IRS. Then we started out producing applications for grants, and concentrated on the optimum-need to have neighborhoods. We went from little grants, like the Walmart Foundation, and at some point the metropolis of Albuquerque started out paying for me to supply summertime, just after-university, and household programming at as many group facilities as doable.

It was uncomplicated for me to say, “As a nonprofit, this is what I am likely to do for you, and right here is my spending budget,” mainly because Challenge Island has been in existence for nearly two a long time and has an established curriculum that aligns with specifications.

1 of your objectives has been acquiring grants for much more Native American learners. What’s been your emphasis in people communities?

1 thing I’ve focused on — and this is not just for the Native American populace, but it has impacted them — is loved ones literacy. That suggests it can be not just the children functioning on Challenge Island pursuits, but their moms and dads, also.

Throughout the pandemic, a single family members I labored with practically was a Native American mom and her two sons, who were being 9 and 7. At initially the mom was extremely shy and did not want to be on camera or communicate about herself. But in excess of the program of a calendar year, she begun receiving on digicam and displaying me issues she and her young ones had been developing together. They built pirate ships out of Coca-Cola 12-pack bins — I am speaking, like, a multi-masted pirate ship on wheels. It was huge! She was generating mazes out of pizza containers, with mini putt-putt courses and cityscapes and matters like that.

These pursuits are small hazard, so the mother had an option to get artistic and just attempt factors. She talked about how her sons were acquiring alongside better, finding out to function alongside one another. That was a large achievement tale for me, since I noticed a shift. Now she’s doing the job toward her substantial university equivalency.

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What would you convey to other franchisees interested in likely the nonprofit route?

I know other franchise owners in the procedure of or thinking of making an arm of their enterprise that is nonprofit although maintaining their for-earnings side, and I assume that’s wonderful. The economic base line is a actuality. It’s quite vital. You have to continue to keep revenue coming in to make a company survive.

But if you consider the time to look at your community impression, and if there is none, probably which is an option to change what you might be undertaking a minor — whether or not you might be accepting volunteer support for specified community assignments, or donating time or products. There’s often an possibility for effects.