What Skype and MySpace Teach Nonprofits

The activity this week of these two very different sites – Skype and MySpace – may seem unrelated to nonprofits.  But Skype’s sale to Microsoft for $85M and the valuation of MySpace at 25% of its previous value provides some good lessons.

Skype is a nice success story.  It illustrates how being early in the game – helping to create the game – can help you to become a leader.  We use skype as a verb now, the way we use google as a verb.  Skype makes a difference in the way we think about communication.  While Microsoft (or others) may speculate about possible overvaluation, they now own a certain share of the market and, just as importantly, have kept it away from their competitors.

MySpace, on the other hand, is the story of a site that was also in early but had no barriers to entry and, over time, did not change enough to remain “relevant.”  It was copied and “done better."  So it lost it’s standing as the leader and, though it was “hip” for while, it fell out of fashion.  It was replaced, both technologically and culturally. 

I know I've simplified here with my summations of both cases - but the real question is: what relevance does this have for nonprofits?

Like Skype, if you’re providing a service that is unique – if you do something no one else does in an area –  crow about it.  Get your constituents to tell their stories.  Record their testimonials.  Grow your fan base.  “Own” your market.  Most importantly, prove your worth.  Show how you’re making a difference.  This is what funders want more than anything else.  Illustrate results.

Don’t fall into the MySpace traps.  Those include being blinded by “popular” programs – what is fashionable at the moment or what others are doing.  Or starting a new program because some funder likes the idea and wants to back it (if it is not on target with your mission).  Stick to the knitting.  Do what you do best while continuing to innovate, working out how to do it better.  And stay up-to-date with technology that can help you manage your programs in a more cost-effective way.

Being focused on your mission and your results never goes out of fashion and will always be “valued” by your funders.