Many civic technology organisations will have heard the call to diversify income streams. As seen in the various considerations of risk, this is a really important strategy for ensuring that you are less reliant on single entities whose priorities or strategies may change, and also less politically vulnerable – creating a
better balance of power between you and your funding sources. However, there is a caution from other research worth noting: “Gains from diversification can quickly reach diminishing and negative returns as additional investment in capacity are required to manage and support these added revenue streams and
relationships”. You can think of it then as a classic “Goldilocks” situation: how much diversification will be “just enough” for your organisation considering your ultimate impact and finance strategy?
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