: Successful Nonprofits: Surviving an Economic Crisis

Surviving an Economic Crisis

Navigating Uncertain Times with Toni Perglin


Surviving an Economic Crisis

Navigating Uncertain Times with Toni Perglin


by GoldenburgGroup

As leaders and nonprofit organizations, we are facing uncertain and difficult times ahead. All organizations face periods of hardship, but an unprecedented number of nonprofits are wondering how they will survive. And, beyond that, how can they possibly thrive again?

If you are feeling alone, please know that you are not. And know that there is hope. To prove it, Toni Pergolin shares her experiences bringing a nonprofit back from the brink of bankruptcy and turning it into a healthy, vibrant, and thriving organization. So please take a few minutes to join us for Toni’s key lessons for nonprofit, and personal, survival.

Listen to the Episode Here!


Toni’s Website

Bancroft’s Website

Toni’s LinkedIn


(5:05) Bring business acumen

(8:40) Strengthen communication

(9:59) Build a vision

(10:41) Develop a backup plan

(13:32) Focus the board

(15:14) Build trust with staff and clients

(16:59) Take the next steps

(21:58) Insist on self-care



Dolph Goldenburg (00:00):

Welcome to the Successful Nonprofits® Podcast. I’m your host, Dolph Goldenburg. We are recording this conversation with Toni Pergolin in the midst of an economic meltdown and even though we scheduled this recording session months ago, we could not have better timing. You see, Tony is a celebrated, successful nonprofit CEO who brought the venerable 137 year old nonprofit, Bancroft, back from the brink of bankruptcy. Now, full disclosure, when Toni’s PR people first reached out to me, it was the type of pitch that I typically decline. While she had a newly released book, based on the email that I received and the promo materials that were attached, it felt to me that Toni would primarily be pitching her organization, Bancroft. And while Bancroft is a worthy organization serving children and adults with disabilities, I explained to the PR team that we don’t really profile individual nonprofits or businesses. Their response was perfect.

Dolph Goldenburg (01:07):

They said, “Dolph, let us send you a copy of the book. If you like it, please have Toni on.” And to say the least, I loved the book. It is incredibly readable, and it is also an engaging story about the steps Toni took to save Bancroft and the hundreds of families that depend on the organization, even today. I quickly realized that the book’s subtitle, Leadership Lessons for Nonprofit Leaders, was apt, especially for nonprofit leaders of organizations in financial trouble. And right now, Dear Listeners, with the economic collapse we see happening around us, I bet that’s a lot of nonprofit leaders. I could share so much with you about Tony’s resume, but her most important professional achievement is leading Bancroft to financial growth and a new life as their CFO, COO, and, for most of the time she’s been there, the CEO. All of which is described in her book: Too Important to Fail. So, please, join me in welcoming Toni to the podcast. Hey, Toni, welcome.

Toni Pergolin (02:16):

Thank you. Good morning.

Dolph Goldenburg (02:18):

Good morning. So let’s talk about Bancroft’s financial situation on your very first day.

Toni Pergolin (02:25):

So as I was being recruited to the chief financial officer role, I received their financials and I could tell by the financials that they were struggling. So, within short order, like the first few weeks, what I realized is that it was way worse than what the financial statements said. When I got here, the financials were showing losses, which is not unheard of in nonprofits, but what they didn’t show was the precarious cash situation we were in. So cash was coming in at a very slow rate. Vendors hadn’t been paid for months. I came into call after call after call with a vendors saying, “Please pay us something. We are going to have to turn off your utilities. We’re going to have to cut off your supplies. We’re going to have to cut off your health insurance to your employees.”

Toni Pergolin (03:22):

It was serious because they hadn’t been paid for so long. I was trying to figure out exactly why cash wasn’t coming in, because revenue was certainly being generated, we were for sure performing services. The biggest fear that I felt every 10 days was that payday came whether we were ready or not. And it was really in those first two weeks that I realized that we were tapped out on our line of credits and we had no investments to pull from. We literally had only what was in that bank account and it barely was enough to make payroll.

Dolph Goldenburg (04:00):

You know, Toni, one of the things that I say again and again for a lot of CFOs and executive directors of nonprofits of all sizes: payday is like a gun to their head every two weeks. And especially for those organizations that pay 26 times a year. I remember as an employee before I was a chief executive, loving those two months out of the year when I got three paychecks. But I also remember as a CEO thinking, “Oh my gosh, now we have to hit payroll three times this month.”

Toni Pergolin (04:29):

I totally agree. And I used to love those three day weekends like President’s Day and Martin Luther King Day. But as a CFO, I panicked through them because it was one less day the cash would come in. We wouldn’t get mail that day. We didn’t get cash that day. You really see it from a whole different perspective when you’re so dependent on every dollar you receive in.

Dolph Goldenburg (04:52):

Okay. One of the things that I really love, and you laid this out in your book, are some of those critical steps you took in the first 18 months, even 24 months, to start the turnaround. Can you say a little bit about those?

Toni Pergolin (05:04):

Sure. So at the time all I kept thinking about was, “I’ve got to prioritize.” Everything was broken, but you can’t fix things like how your investments or your donations are recorded. You’ve got to start with the highest priority, which was cash. So I spent all my time for the first six months in the business office trying to understand the process and why the bills were going out incorrectly. I was trying to understand what the issue was. And I tried a lot of things. I brought in a consultant. I brought in new managers. And ultimately I ended up outsourcing the entire business office because, without the cashflow coming in, nothing else mattered. But when I look back in retrospect, I have to say that the single most important thing I think I brought to this organization was that I had business acumen that my predecessors did not necessarily have.

Toni Pergolin (06:02):

So I’m only the ninth leader of this organization, which I found very admirable. The people prior to me, I think, were more focused on the treatment of kids with autism. And I don’t know that piece. So I’m grateful for the treatment and care models they established. But they didn’t necessarily have the business acumen at a time when the funding models were changing and billing requirements were different. And so if you don’t understand the business model, you can’t keep it going. And that was really what I did immediately: understand what part of our programs generated revenue, which ones we got paid quickly, which ones took a long time to get paid. You have to really understand that to a day when you’re running an organization on such a thin, thin margin. So business acumen I would say was the thing I needed or that helped the most.

Dolph Goldenburg (07:06):

And let me just say this shined through so well in your book. I loved that you definitely took a business approach to it, but you also saw the human side of the work that Bancroft was doing. And I think that’s probably actually where your title, Too Important to Fail, comes in. You tell stories of real people in real families who have been served by Bancroft and you talk about these moments where you realized this wasn’t just about turning around the business, but saving the organization for these people who need it the most.

Toni Pergolin (07:37):

Yes. So I mean truth be told, I came ready for anything. My husband, who is a banker, said, “You know, it might go into bankruptcy.” And I thought, “That’s okay. I’m a CFO. I’ve never done that. That’d be great experience.” I really came for the experience. But when I got here and I started meeting some of the individuals we serve and their families and I heard their stories about where would they would be without Bancroft and Bancroft really allowed their children to do things they never thought they would like go to the prom and graduate from high school and get a job. I was stunned. And I thought, “I can’t make this an accounting problem and get experience of bankruptcy. I really need to make sure this organization is here for these really incredible people who were dependent on Bancroft for so long.”

Toni Pergolin (08:29):

There are people here today who have been a part of the Bancroft family for over 50 years. Where would they go? And that’s truly how I felt and it really kind of inspired me to keep moving through the process. Other than the business acumen that I brought, I have to say that another critical part of the turnaround was communicating to people. I found out a lot of people did not know just how dire the situation was. But when I could share it with them and say, “Here’s how you can help,” it was all hands on deck. Everybody wanted to help in one way or another. And what I learned is that the operations people did not understand that every time they made a decision, whether they’re admitting somebody, approving somebody for over time, or buying supplies, every decision they made had a direct impact on the financials of the organization. That was an aha moment for them and they could make much better decisions knowing that.

Dolph Goldenburg (09:28):

Absolutely. And I clearly saw that. You talked about going into managers meetings and managers never really having access to the financials and not knowing how dire the situation is.

Toni Pergolin (09:37):

Correct. I tried to make it more personal by saying that it’s like Bancroft is spending money and never looking in the bank account, which you would never do personally. We’re just spending, spending, spending. So I made sure managers saw the bank account every month so they understood where we were. And it really aligned people, help them understand it. Then I would say the third piece was that I created a vision for them. I created the vision that the first thing we’re going to do is stabilize. So people were asking where we are going to be in three years. But right now we’ve got to think about next payday. So you have to break it into small chunks so that people know what you’re working toward. And when you work toward it and you achieve it, you have to celebrate it because that builds confidence in people. And then they are going to keep following my lead because they see that we’re getting better and better. So I would say business acumen, communicating and creating a vision for success in small steps were really some of the critical things I did in the beginning.

Dolph Goldenburg (10:41):

I also loved another critical thing you did, which was that you had a backup plan. You worked with the senior leadership team and the board to make sure there was a backup plan if it didn’t work.

Toni Pergolin (10:54):

Correct. And I think that that’s important because there were a lot of things that were really out of my control. For example, if the bank wasn’t going to give us a waiver to miss covenants, then we were done. So there are some things that are out of your control and because of that you really do need to have a backup plan. So the backup plan for us was to talk to other organizations about merging. We went and looked at five other organization and we talked to their board. We did a lot of work around that. In the meantime, we were trying to fix things up so somebody would like us; we were trying to get much stronger so somebody would want to merge with us. I’ll never forget the moment where we made the very scary decision between merging or staying independent. And of course it was a very big decision. But once we made it, once we pulled that band aid off, we were full steam ahead.

Dolph Goldenburg (11:58):

One of the other things that I love about the story of approaching possible merge partners is there were a couple of partners, or at least one that said, “Hey, we’re not interested given what your current financial situation is.” And that’s when you also went back to the team and said, “Okay, we’re not just strengthening ourselves to maybe survive independently. We’re strengthening ourselves to survive even if we merge.”

Toni Pergolin (12:22):

Correct. Because we knew that a partner would only want a strong organization. And so we really needed to focus on doing what was right for the care of our individuals as well as running a company to ensure that we were able to move forward in one way or the other.

Dolph Goldenburg (12:41):

Something that struck me that may not have come across to most readers, and please don’t take this the wrong way, is that you were an accidental CEO. Like a lot of nonprofit executives, you did not come to Bancroft to be the CEO.

Toni Pergolin (12:59):

That’s true. I like that that term. I never thought of it that way, but I was the accidental CEO. I came to be the CFO. That is my background and in my heart I still love my financials more than anything; that’s what drives me and it’s the expertise that I bring. But as I went through the process and when we did decide to stay independent, they asked me to be CEO. I was honored, and to be honest with you, I was a little scared because I really didn’t know even what all that meant. The first thing I did was meet with the executive committee of my board and I said, “Look, I really, really appreciate this opportunity and I’m going to do the best I can, but I’m a brand new CEO and we just came out of a really tough situation. I really need a board that’s much smaller and much more focused that can really act as my advisors moving forward.”

Toni Pergolin (13:56):

At the time we had a very large board. 51% of them, per the bylaws, had to be family members. So, while they absolutely were committed to the organization, they didn’t necessarily have the expertise that I needed to guide us out of this place that we were in. I really give credit to the chairman of my board at the time who helped me do it. We put all the families on advisory councils and we really created a board that could surround me and provide guidance as we moved the organization forward. I’d have to say that was really critical as a new CEO.

Dolph Goldenburg (14:32):

Yeah, I could totally see how that transition in your board would just be so essential to, not only your success, but Bancroft’s success.

Toni Pergolin (14:40):

Absolutely. We had board members who were very philanthropic and were able to provide support as we went through the turnaround. The board absolutely was critical and I think a big reason why we’re as strong as we are today.

Dolph Goldenburg (14:56):

What was the transition to CEO like as you are having conversations with those folks who were holding your bonds on Wall Street and your major donors who were giving you no-interest loans or making major gifts to you? What was that transition like?

Toni Pergolin (15:12):

So, it was interesting. People like the bond holders were happy about it. They thought, “Oh good, somebody with a finance mind running this organization. We’re good.” But the families and the staff were concerned. They thought, “All she’s going to care about is the money. All she’s going to care about is the business.” And to be honest with you, I was a little afraid that all I was going to care about was the financials, too. So I was very self-aware about that and I spent purposeful time out in the programs to really understand what happens at the organization. The first two years I was here, I was really stuck in my office trying to make the numbers work. And so when we finally stabilized, I wanted the families and staff to see me as a person. I wanted them to know that I’m a mom and I care about my kids, and these kids, and the staff. The staff that work at Bancroft are amazing; they do amazing work with these individuals with disabilities. And so I wanted them to see that I was just as much in tune to that as I was on the financials. And I think that was critical; I think people began to build trust in me in a way they might not have before.

Dolph Goldenburg (16:29):

I want listeners to get a glimpse of the success story that Bancroft has been, as well as you as their CEO. You’ve been there about 16 years. So I know we’re not going to be able to cover everything that’s in the book, Too Important to Fail, which is well worth getting and reading; it is a great roadmap for any chief executive who feels alone right now. But I want to make sure that readers and listeners have a sense of the success that Bancroft has experienced under your leadership. So talk about where Bancroft has gone from 15 to 16 years ago with an aging campus to where it is today.

Toni Pergolin (17:10):

Yes. So in addition to arriving in this financial crisis, if you will, the other crisis that was happening was that our headquarters was aging. Our campus was located in Haddonfield, NJ, where our founder, Margaret Bancroft, started her first school. So there were a lot of history and roots there. And it was a beautiful, 20 acre property in a nice, quaint town. So while we’re going through this financial turnaround, I knew in the back of my mind that in order for this organization to truly be a thriving organization, we were going to have to either renovate or rebuild or do something to the campus. I mean, we were 125 years old at the time and we looked every bit of it.

Toni Pergolin (18:02):

And so we went through a lot of evaluations. After we got through the turnaround, we really focused on growth because I knew that I was going to have to build up that balance sheet so that at the time we were ready we could issue some bonds that would allow us to either rebuild or renovate. So the first five years was all about growing the organization. We did some mergers, we did some efficiencies, we did a lot of organic growth. If you look at my revenue trend, it’s a nice trend up. I was really focused on growing revenue. But we a lot of board members and people who doubted taking on the challenge of building a new school.

Toni Pergolin (18:44):

So I put on my business hat again and I said, “You know what? If we don’t, we really will not be here for a sustainable time.” And here’s why. While we have many programs, I would say our key program is our school. And I say it’s key because 75% of the individuals that are in our adult program came through the school. So it’s like the front door to the entire organization. So if your front door is small, if your front door is falling apart while all of our competitors are building new schools, people would not come here anymore. So that was really what inspired me to figure this out. And it was hard. We had to sell the campus, we had to leave the county, we had to find a new place. But you know, we kept going. And we found an 80 acre piece of property in Mount Laurel, NJ, which is a county over from where we were.

Toni Pergolin (19:42):

We took on this $75 million project, which meant a lot of sleepless nights. There were a lot of issues. We had been profitable for 10 years and the year of financing, we actually had an admission suspension. So we actually lost money the year we were financing for the first time. So we were going through this turnaround yet again. And what I learned is that, especially in the nonprofit world, you’re never done going through financial crisis. You’ll always be in some to kind of turnaround mode. You have to acknowledge that and be ready for it. You’re never done. You’re never like, “Okay, we’re good.” And you know, to be honest with you, I’m a little worried that we’re about to go through it again with this whole scare on the virus. I’m just as nervous about operating the company as I am around keeping my people safe.

Toni Pergolin (20:30):

So we undertook this project. We were able to get the financing and once the shovel went in the ground, I have to say this campus came up within one year. Today it is a state of the art facility. It’s all windows. The architect built it specifically so that you can see nature wherever you are because kids with autism are much more calm when they see nature. So we were able to build an environment that was really best for the individuals we serve. We were able to make some accommodations for families to better be able to visit their loved ones and for staff to be able to have some downtime. So it’s a beautiful campus today with 265 children in the school and 70 residential students living right there on the campus.

Toni Pergolin (21:23):

We knew we were going to increase capacity and I have to say we’re thrilled today that we’re able to serve children from all over the nation, from California now and Georgia and Colorado and Oregon. So places we never were able to really bring in children before, but there’s for sure a need for the service we provide and we’re excited that we’re able to do it. But it was an effort and it continues to be. Now we have a lot of debt on our books, but we wouldn’t be able to be where we are today without it.

Dolph Goldenburg (21:58):

Right. I do not want us to end this conversation without talking about the emotional toll, especially the emotional toll you experienced in the first three to four years. I know what the emotional toll is. I could tell from reading the book, from having stepped in as the chief executive of an organization in trouble, as well as an interim chief where sometimes organizations are in trouble. Can you say a little bit about that?

Toni Pergolin (22:26):

Yeah. When I reflect back on it, I felt an immense responsibility for the organization because even though I really tried to help people understand what was going on, nobody really understood it the way I did. I truly knew that we were, at times, a few days short of running out of money to make payroll. Living with that responsibility was really difficult. At the same time, I had two young children, ten and seven, so I had to go home and take off the CEO hat and put on the mom hat and make dinner and go to baseball games and do all those things; I didn’t want them to skip a beat. I always laugh at the time at the dinner table when they said, “Mom, how was cash today?” And I looked at them and I realized that when cash was good, mommy was happy. And when cash was bad, mommy was sad. So, you really have to juggle that. I have to say, though, I’m kind of glad that I had another light to go home to because it really can consume you if all you’re doing is worrying about the work. But I felt an incredible sense of responsibility that really fueled me and allowed me to keep moving forward.

Dolph Goldenburg (23:41):

And I will just reflect that I was really impressed that you made a point of leaving the office by 6:30pm so that you could go home and be with your family. You also talked about, in those first couple of years, when you scheduled a trip with your mom to Chicago and you said, “I don’t care what happens. We’re still going to go away.” Or the cruise with your husband for four days. So I love the fact that you set some good boundaries so that you still had some sense of individual separation from the organization you were running.

Toni Pergolin (24:13):

Yeah. And I think that’s important, even today. I’m a big proponent of vacations both for myself and for my staff. It’s just really healthy to get away from it because we get so caught up in all that we have to do. So I’m a big proponent of it and for sure I think that was a part of my survival.

Dolph Goldenburg (24:31):

I could not agree more. I want to save just one minute for the off the map question. Toni, the off the map question is a question that allows listeners to get to know you a little bit as a person. Although, I think just in this conversation they’ve gotten to know you as a person and if they read your book, Too Important to Fail, they’ll get to know you as a person, as well. But one of the things, Listeners, that Toni and I share is that we’re both from the Philadelphia area. Although, I think she might actually be from the region whereas it’s my adopted hometown. Philly is just on the other side of the beautiful Delaware River from Camden county, which is where Bancroft was located when she first started. So we’re from a similar part of the world. My question for you, Toni, is everyone in Philly and South Jersey has a favorite shore town. What’s your favorite shore town and why?

Toni Pergolin (25:21):

That’s a great question. Well, I have two. I actually grew up in Pittsburgh, and every year we drove eight hours to go to Wildwood, New Jersey. It was the one week we looked forward to every single year. But at the time I did not know that there were other shore towns. I only thought that there was one until I moved here. And then when I moved here I realized there were way more. From the time I moved here as single to today, I would say Sea Isle City is my favorite shore town.

Dolph Goldenburg (25:55):

I love it. Okay. And so why Sea Isle City?

Toni Pergolin (25:57):

So I think it’s, it’s a nice combination of both a family town and an older town. So there’s restaurants and there’s bars and there’s a lot of family stuff, as well. A lot of the shore towns are either all bars and restaurants or all family. And I think Sea Isle is a really nice combination. We love it.

Dolph Goldenburg (26:15):

That’s awesome. I do have to share with you, I adore Wildwood when I want a rowdy time. Admittedly when I moved to Philly I was in my very early thirties, so I do not want as rowdy of a time as I did in my early thirties. But for me it’s Wildwood and Cape May. Oh my gosh, I could live year round in Cape May, I really could.

Toni Pergolin (26:33):

It’s lovely. Lovely.

Dolph Goldenburg (26:37):

Well, Toni, thank you so much for joining us on the podcast today. I am so grateful that you came on and shared a little bit about your book, Too Important to Fail: Leadership Lessons for Nonprofits. Listeners, if you want to get Toni’s book, obviously you can do it on Amazon. But I would encourage you to go to her website, toni-pergolin.com. That’s toni-pergolin.com. Listeners, let me also just say this book is packed full of lessons for trying times and it reads like a story, not like a textbook written by an accountant. So please make sure you pick up a copy of this book, especially if you are feeling lonely right now or a little bit isolated as we move into very trying, uncertain times; this book can be real solace for you. Additionally, people can find out more about Bancroft at bancroft.org and if you want to connect with Toni on LinkedIn, we will post a link to her LinkedIn page as well. Hey Toni, thank you so much for joining us on the podcast today.

Toni Pergolin (27:48):

Thank you. This was fun. I enjoyed it.

Dolph Goldenburg (27:51):

Listeners, we all know that the economy is transitioning to challenging times and when the economy gets a cold, our nonprofit sector gets pneumonia. So please be certain to pick up a copy of Toni’s book: Too Important to Fail. It is really the perfect mix of inspiration, consolation, and education that will speak to your situation. And by the way, I never sound like a preacher. I don’t know where that came from, but I just sounded like a preacher. If you missed any of the links in today’s show, please visit successfulnonprofits.com. While there, you can also subscribe to the podcast or reach out to me; we now put my email address in every set of show notes. Please know that I always respond when you contact me, although it can take a day or two depending on how busy my day is. Now, if you’re a faithful listener of the podcast, please help share the word by sharing this episode or rating and reviewing it on the podcast streaming service of your choice, whether that’s Podcast Republic, iTunes, Stitcher, wherever. That, Dear Listeners, is our show for the week. I hope that you have gained some insight to help your nonprofit thrive in a competitive environment.

Dolph Goldenburg (29:05):

I am not an accountant or attorney and neither I nor The Goldenburg Group provide tax, legal, or accounting advice. This material has been provided for informational purposes only, is not intended to provide and should not be relied on for tax, legal, or accounting advice. Always consult a qualified licensed professional about such matters.



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