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Nonprofit Restructuring Models. Presentation by jane arsenault , MBA Fio partners, llc Ri Society of Cpa’s February 7, 2012. Two basic options. Substructure: creation of new underlying infrastructure Superstructure: creation of system level corporate umbrella or new combination.
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Nonprofit Restructuring Models Presentation by janearsenault, MBA Fio partners, llc Ri Society of Cpa’s February 7, 2012
Two basic options Substructure: creation of new underlying infrastructure Superstructure: creation of system level corporate umbrella or new combination Fio Partners, LLC
Consolidation Continuum High risk, high cost to create, reduced autonomy Merger or acquisition Parent Corporation Service Networks Lower risk, lower cost to create, retained autonomy Management Service Organizations Joint venture or partnership Fio Partners, LLC
LARGE NPO CONTRACTS NPO 1 NPO 2 NPO 3 Sub-structure: Management Service Organizations Fiscal agent: usually short term Fio Partners, LLC
Partnerships/Joint Venture Models JOINT VENTURE MANAGER INCORPORATED JOINT VENTURE NPO 1 NPO 2 NPO 3 NPO 3 NPO 1 NPO 2 JV Contractual • Knowledge sharing • Market access • New product or program development NPO 3 NPO 2 NPO 1 Partnership Agreement Fio Partners, LLC
LARGE NPO MSO DIVISION Board of the MSO MSO STAFF CONTRACTS NPO 1 NPO 2 NPO 2 NPO 1 NPO 3 NPO 3 Management Service Organizations EQUAL REPRESENTATION • Reduce cost by consolidating overhead • Third party negotiations or joint purchasing • Contracts management Fio Partners, LLC
Lead Agency CEO NetworkAdministration Contracts with providers NPO 2 NPO 3 NPO 1 NPO 4 NPO 5 Networks: many models CONTRACT WITH STATE OR MANAGED ENTITY Fio Partners, LLC
Board of Network Bylaws and operating agreement Lead Agency CEO Network Administration Network Administration Contracts with providers NPO 1 NPO 2 NPO 3 NPO 4 NPO 5 Networks: many models CONTRACT WITH STATE OR MANAGED ENTITY Fio Partners, LLC
Board of the MSO NPO 1 Staff of the MSO NPO 2 NPO 3 NPO 4 NPO 5 NPO 6 Networks: many models CONTRACT WITH STATE OR MANAGED ENTITY Fio Partners, LLC
PARENT CORPORATION NPO 1 NPO 3 MSO NPO 1 NPO 2 NPO 3 PARENT CORP NPO 2 IP TRUST FOUND Parent Corporations TRADITIONAL NON-TRADITIONAL • Phased merger • Service integration • Create financial stability for large, related entities • Creation of subsidiary corporations within one large non-profit Fio Partners, LLC
NPO 1 NPO 1 NPO 2 NPO 2 NPO 3 NPO 3 Acquisition, Merger, Amalgamation RESULT IS A LARGER NPO #1 SOMETHING ENTIRELY NEW IS CREATED LARGER NPO 1 • Elimination of excess capacity • Economies of scale • Reducing competition • Reduce duplication of effort • Invent organizations that previously were not needed Fio Partners, LLC
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