The Nonprofit Niche Opportunities & Challenges Charles Tate, CPA, Managing Partner (202) 419-5101 ctate@tatetryon.com LEA Managing Partner Meeting January 16, 2017

Firm Background 100% nonprofit 131 staff & partners (18th largest in DC Metro Area) 50% audit /50%outsourcing & IT 8 people focus exclusively on EO Tax No individual tax

Evolution of the Nonprofit Niche 1980-1989 Big 8 departs the niche 1990-1999 Niche practices emerge/Dot.com 2000-2009 Enron/SOX distracts larger firms from niche 2010-Today firms are driving down niche prices

Perspective on the Nonprofit Industry Traditional services are becoming very price sensitive Large national firms dominate the > $100M sector Long marketing/sales cycle RFP driven - prospects ask about experience/references Retain clients 5-15 years, depending on type of service Business practices tend to lag behind corporate sector

Major Players in the Nonprofit Niche Large National Firms - Large Healthcare and Higher Ed. CLA, RSM, BDO (sometimes KPMG & Grant) 3-4 other local/regional firms Non-audit services – non-CPA firms Chicago market appears similar to DC

Marketing Approach: How We Got Started Face to face networking Print advertising and newsletters

Top Deciding Factors in Firm Selection 35% of buyers ranked specialized expertise as top deciding factor, well ahead of referrals, reputation, or customer service. Expertise came out just ahead of existing relationships as a deciding factor. Source: Accounting Today/September 2016

Factors Increasing the Probability of Referrals? Source: Hinge Marketing

Marketing Approach: What Tate & Tryon Does Today CRM Digital Media Speaking & Writing Networking events One-on-one Microsoft CRM Click Dimensions Syncs with Time & Billing Niche Newsletters Announcements Social Media Proposals Website AICPA/GWSCPA Symposiums In-house Seminars ASAE/CEO Update EO Commentary Emerging practices white papers Symposiums FAR/Council of Nonprofits/GWBOT Seminars hosted by other service providers Get to know brown bags with attorneys Board or Committee positions Hosted dinners with other professionals (10-15 prospects) Lunches Sporting or cultural events Golf

The Marketing Engine is Our CRM Microsoft Dynamics CRM - 15,000 contacts Opportunities distributed to the Management Team Notification of “Won” Opportunities Used as forecasting tool Used a marketing strategy tool

1. Example: Opportunity Created A new Proposal Opportunity has been created in CRM: Subrecipient consulting work for National Academy of Sciences.  If you have any contacts that would be able to assist us in winning this opportunity, please contact the Proposal Lead.      National Academy of Sciences Primary Contact:         Didi Salmon    Service:                      Audit Topic:                          Subrecipient consulting work Status:                         Proposing Revenue Size:            $50M + Proposal Lead:          Doug Boedeker Est. Close Date:        11/15/2016 Est. Fees:                   $‎17,000.00 Proposal Due Date:   10/20/2016 Opportunity Submission Method:           Email to Individual Opportunity Submitted to:                      Doug Boedeker How did Opportunity Hear about us?     Existing Relationship (or previously worked with) Opportunity Referral Source Details:     Referred to Doug by Laura Douglas. Proposal Lead                                        Doug Boedeker                         

2. Example of a “Won” Opportunity A new opportunity has been won! The opportunity in CRM called Sub-award Monitoring Assistance for National Academy of Sciences has been closed as won. Lynne, Please add a new client number if necessary for National Academy of Sciences in CRM, as well as any necessary projects to Tenrox. Debbie, Fred, Please update FIT as needed. Account Name National Academy of Sciences Acronym: NAS Revenue Size $50M + Main Phone (202) 334-2000 Primary Contact Didi Salmon IRC Section C3 Year End December Est Fees $‎17,000.00 Partner Responsible: Doug Boedeker

3. Forecasting Tool is the Weekly Opportunities Report

3. Forecasting Tool is the Weekly Opportunities Report

4. Data Influences Marketing Strategy

Niche Focused Seminars

Niche Focused Monthly Newsletters

Non-Traditional Service Offerings Opportunities Business process improvement Risk management Data analytics Human resources/compensation data benchmarking Investment management HR Outsourcing

Considerations for Your Nonprofit Niche Do your homework – particularly your geographic region Develop a plan – Traditional or non-traditional services Develop a strong reference list Be patient - profitability will take time

Thank you for your time! Questions?