Familylinks and Vintage Inc. were running on parallel tracks with their strategic planning.
Familylinks wanted to grow in the area of human services aging programs without duplicating services that already exist, while Vintage realized it needed a partner to generate long-term sustainability.
Vintage’s board decided to start looking when Executive Director Ann Truxell saw that Familylinks had entered the aging world after it was awarded a case management contract. So she reached out to CEO Fred Massey.
Both organizations brought something to the table with their formal affiliation.
Vintage is small, with a budget of less than $1 million a year, but it has a lot of experience and a good reputation with senior services. Familylinks’ budget is around $20 million, so it’s big enough to have in-house infrastructure like payroll, accounting, HR and IT.
“It can be a very efficient way for a small nonprofit to be smarter, and for a large nonprofit to think, ‘How do I take advantage of these resources that I have and start to leverage them for growth?’” Truxell says.
Going through the process
After several months of informal exploratory talks, both boards authorized a due diligence phase, which lasted three months, before a formal affiliation agreement was signed.
Then, the two organizations went through six months of transition before the agreement was enacted.
“It’s one thing to decide that you’re interested in affiliation, and it’s quite another to find the right partner,” Truxell says.
She knew that cultural fit would be just as important as mission fit. The transition time helped minimize hiccups as the two organizations merged together.
Truxell says Vintage staff was able to reassure its senior clients and start to attend Familylinks meetings and develop relationships. It also helped Vintage’s executive staff realize all the time that wasn’t spent on accounting, payroll and back office work could be used to focus on the mission of serving older adults.
“I think the other thing that helped us is that we had a very vibrant joint steering committee, which was made up of the top executive staff and three board members from each organization,” she says.
Massey says an impartial consultant added another tool to ease the process.
Timing it right
Familylinks was originally formed as the result of a true merger in 2001. At that time, consolidation in the nonprofit sector was sometimes looked at negatively, Massey says.
That’s changed today as a consolidation of government funds necessitates human services organizations be able to provide multiple types of services for a continuum of care.
And when Familylinks wanted to grow into the senior sector, Massey says they considered a few other agencies before Vintage, but they weren’t strong enough to be attractive partners.
Timing for a merger or affiliation is critical, and early is better.
Truxell says both organizations need to be strategically planning five to eight years down the road.
“Our organizations entered into this investigation and agreement from a strength point,” she says. “I think maybe some organizations wait until they are in trouble, and then all of the sudden, it’s like, ‘Oh, maybe we should join with someone.’”
Vintage could have kept going for several more years just as it was, Truxell says. But the proactive board recognized early that a structural change was needed for the long-term future.
Massey says that boards are more likely to be proactive when nonprofit executives educate them of even the possibility of consolidation. Otherwise, boards will just follow the regular procedure that they’ve normally done.
“Ann and I got along very well upfront — planning together and recognizing our roles upfront. Then the boards saw that, which allowed for us to really drive this process so that we could come to this point,” he says.
How to reach: Familylinks, (412) 343-7166 or www.familylinks.org; Vintage Inc., (412) 361-5003 or www.vintageseniorservices.org
