Does Bad Software Hurt Nonprofits?
Cloud-based software (aka 'the Internet')
Now (in 2015) we’re finally getting “cloud-based software,” which is just a fancy way of saying “we finally stopped selling software on CDs and joined the 21st century.” It’s astonishing to me that so many nonprofit tech companies are still making a big deal out of something they should have done 10 years ago. Welcome to the Internet! Glad you decided to join us.
Don’t be fooled by buzzwords like “cloud-based software.” The fact that they were selling CD-based software anytime after 2005 should be appalling. It’s grossly negligent, but profitable.
What went wrong?
Badly managed corporations with small visions — I'm calling them out. This isn't aimed at any specific company but rather at the nonprofit software industry as a whole. Here are some examples of abusive practices:
- Making data as hard as possible to export in order to make it prohibitively expensive to switch systems ("maximizing switching costs")
- Requiring long contracts with punitive clauses ("locking in customers")
- Coming up with absurd justifications for taking a large cut from all online donations ("donation skimming")
- Overcharging for software that costs a fraction as much in other industries ("abusive pricing")
- Making software intentionally hard to use so nonprofits must pay for expensive training ("maximizing profits")
I could continue at length, but I hope you get the idea. There are some very ugly business practices in the nonprofit software industry, which is especially grotesque when you consider who loses.
What are we doing about it?
The first challenge is to connect all of your supporter data in one place and then make that data beautiful, intuitive and powerful. Once we've fixed that critical infrastructure, we have achieve awe-inspiring things in philanthropy.