Nonprofit mergers and alliances: an overlooked tool in leadership succession
After I announced my transition from Village Capital, several folks in the sector reached out to say they’re considering the same step. It was not surprising.
Nonprofit leaders have spent the last five years steering through a volatile landscape: pandemic disruption, geopolitical shifts, cuts to foreign aid and federal funding, unstable philanthropy, and overstretched staff. In this climate, many founding and long-serving executives are reassessing their tenure. I expect a surge in leadership changes ahead, and boards and funders should prepare for the pressures this will place on an already fragile sector.
A leadership transition should also, and as importantly, force a deeper question than “who’s next?” It is a moment to clarify whether the organization still needs to exist as an independent entity. Before hiring an expensive search firm, tapping every contact, or asking everyone you meet over coffee or something stronger to introduce you to someone, boards should first ask what, exactly, they are trying to preserve? Missions matter. Organizations are simply the vehicles through which missions get done.
Of course, even raising the question of a merger can trigger anxiety among staff, funders, and boards. People worry about losing identity, about layoffs, or about undermining a founder’s legacy. Those concerns are real. But acknowledging them early, and framing Mergers and Alliances (M&A) as a mission-driven decision rather than a failure, allows boards to explore the option with far more clarity and far less emotion.
For small and midsize nonprofits, replacing a visionary, long-serving leader is notoriously difficult. Aside from the cultural vacuum created by a CEO transition, the organization may not have the bench strength, resources, or appeal to attract a successor with comparable experience. In these cases, considering a merger or alliance can be an elegant solution.
Rather than struggling to recruit a replacement, boards might explore aligning with a mission-aligned peer whose leadership team, systems, and infrastructure can carry the work forward. Done well, a merger can strengthen service delivery while honoring the outgoing leader’s legacy. This option is worth considering when:
The outgoing leader has been the primary driver of fundraising and visibility.
The organization faces persistent financial vulnerability or limited growth capacity.
Programs overlap with or complement those of a nearby organization.
There is a clear opportunity to amplify impact through shared strategy and infrastructure.
I saw the opportunity for nonprofit mergers to create an “impact amplifier” back in 2013, when we merged the Startup America Partnership with Startup Weekend as part of a leadership transition strategy. Through the merger, Startup America’s CEO, Scott Case, a seasoned tech executive and nonprofit CEO created an effective transition strategy for an organization that was intended as a three year mandate, but had built important IP and an effective network, by merging with an organization led by a talented emerging leader in Marc Nager, then CEO of Startup Weekend. (Interestingly enough, the resulting organization was ultimately acquired by TechStars).
Funders also play a critical role. Mergers rarely happen without philanthropic support for due diligence, integration, and short-term stabilization costs. More importantly, funders must avoid the reflex of pulling back when a long-tenured leader departs. If the sector is to treat M&A as a proactive strategy, not a last-ditch rescue, funders will need to underwrite transitions with the same enthusiasm they bring to innovation, expansion or simply signing a tie-off grant.
So what should nonprofit CEOs and boards consider as they explore M&A as part of leadership succession?
Explore early: Ideally, M&A should be discussed 12–18 months before a planned leadership change.
Prioritize mission alignment: Shared vision and cultural fit matter more than balance sheets.
Communicate transparently: Engage staff, funders, and partners early to build confidence and buy-in.
Frame legacy thoughtfully: For outgoing leaders, positioning the merger as a way to ensure their life’s work continues can be powerful.
Design shared leadership: Clarify post-merger leadership roles across levels, not just at the CEO/ED position.
Good succession planning isn’t only about filling a position. It’s about ensuring the mission thrives long after a single leader’s tenure. For many nonprofits, that may mean recruiting a new CEO. For others, it may mean joining forces with a mission-aligned partner. Mergers are not the answer for every organization, but they should be a standard consideration. As the sector enters a period of unprecedented leadership turnover, and turmoil, expanding the succession toolkit is pragmatic, and can safeguard a mission’s purpose.
Allie Burns is the former CEO of Village Capital. Allie partners with WhiteLabel Impact, a strategic finance and transaction advisory firm working with mission-driven organizations, on mergers and alliances.
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