Growing by Merging with Elizabeth Forer

Trent Stamp:

Welcome to How We Run, a podcast where we examine how non profits become successful. I’m Trent Stamp, CEO of The Eisner Foundation.

Julie Lacouture:

And I’m Julie Lacouture, Founder of Good Ways Inc. On this episode, we are joined by Elizabeth Forer, the CEO and Executive Director of Venice Family Clinic, who walks us through her organization’s recent merger.

Trent Stamp:

Mergers are complicated. In the nonprofit world, it usually isn’t a merger, it’s a takeover.

Julie Lacouture:

Tell me what you mean by that.

Trent Stamp:

Because usually, when you’re not creating a profit of some sort, and so you’re looking around saying, “Who should we buy? Who should we merge with?” Or, “Who should we try to create a better product with?” You have a strong organization and you have a weak organization, and most times you have an executive director who is retiring or moving on. And so the other organization merges by taking them over and folding their program into theirs. And usually, when mergers don’t happen in the nonprofit world, it’s not because they don’t make good business sense, it’s because there are personalities involved and there are two board chairs and there are two executive directors and there’s two offices and people don’t want to change their commute. And it just gets into something that is an impediment to the process, even though we all would probably be better off if they put the two organizations together, reduce some of the inefficiencies, and created a stronger organization that could serve the people that they’re both serving. But it’s rare.

Julie Lacouture:

Well, in my experience in mergers, people are always on their best behavior and everyone acts super chilled throughout the entire process.

Trent Stamp:

Once the papers are signed and it’s all happened, then the ugliness comes flying out and people start reverting to their worst instincts.

Julie Lacouture:

Everyone’s afraid of their jobs and what does my new reality look like? It’s hard. It’s really hard.

Trent Stamp:

I get it. It’s a tough process, and if you’re not pointing to an obvious bottom line of saying, “By doing this merger, you’re all going to make 7% more or you’re going to get 12 more stock options”, or anything like that, but it’s just going to be more streamlined service, your average employee doesn’t really care.

Julie Lacouture:

Yeah, that’s true. Like what’s in it for me, for an employee at a nonprofit with a merger, is a little bit of a tougher sell than it would be in for profit.

Trent Stamp:

Absolutely. What’s in it for me? It’s important to remember that despite the fact that I am the biggest advocate for nonprofit employees in the world and think that they are the ones that are doing the things that our society needs, it’s important to remember that for most of them, it’s a job and you got to feed your family and you want to have good parking and you want to have decent coffee and you want to make sure that your healthcare works. And a merger oftentimes starts to threaten some of those things and people get their hackles up and they start looking around and saying, “I don’t know about this. This is making me a little nervous.”

Julie Lacouture:

So today we have a conversation with you, and Elizabeth Forer from Venice Family Clinic who merged with South Bay Family Health Care about a year ago to form one of the biggest healthcare nonprofits in Southern California now. And that was a successful merger.

Trent Stamp:

It seems like it was. It seems like they’re serving a lot more people in a lot more locations. They were able to sort out the management factor. They were able to sort out the board factor. They’re more efficient and more effective, and I kept poking at Liz trying to figure out what the negatives were and she seemed to feel like there weren’t a whole lot, that it was a win-win for both of their organizations, as well as society and the people they serve. I was skeptical and cynical because I’m skeptical and cynical about everything. But Liz seemed to have the right answers and she’s been doing this for a long time and far better than I ever could. I was very appreciative of her walking us through the process of how they manage such a complicated merger.

Julie Lacouture:

Yeah. And Venice Family Clinic is a pretty special nonprofit too. They do an amazing array of things and they do it very well.

Trent Stamp:

And they’ve been doing it for a long time and they’re giant. Liz talks about how big they are and how many people they serve. This is a major healthcare related organization that most people may not be familiar with if you’re not receiving your services from a clinic, but that doesn’t mean that what they’re doing isn’t hugely impactful and hugely transformational and is a major driver in the healthcare system, primarily for lower income people on the West Side, as well as now in the South Bay.

Julie Lacouture:

In your mind, when should a nonprofit be looking at a merger? What are the conditions that would make it a good strategic option for somebody?

Trent Stamp:

I think nonprofits should have a commitment to be looking constantly for, how do I merge? How do I take over other organizations? How do I still serve just as many people, but we can do it more efficiently and we don’t have this duplication of services when it comes to back offices and development and all the types of things that are unnecessarily getting in the way from an efficiency standpoint? I’m not saying we don’t need to provide the services that nonprofits do. I just think we could do it with less organizations, larger organizations, especially when the services are duplicative, both in terms of the product they’re providing and the service area in which they’re working. In reality, it really only happened when an executive director quits or a board chair steps down and people realize that there’s an opportunity to put two organizations together for the benefit of what oftentimes is the benefit of one organization, not necessarily the service area they’re working in.

Julie Lacouture:

Yeah. It’s interesting. I’m working with an organization right now on a strategic plan, and one of the things that we’ve been trying to talk about, not necessarily a merger, but it’s just the value of partnering. It’s a tool that not enough organizations utilize of, “Yes, your organization does this, and if you want to do this in your strategic plan, you can get there twice as fast by partnering up with another organization.” And that’s okay to do. No, it’s not a crutch and it’s not a failure, but it’s actually a very effective strategic option for you as an organization. I think it should be part of how we look at how successful a nonprofit is, how many partners they have.

Trent Stamp:

I think there is a tendency in the nonprofit world sometimes to think of things like mergers and acquisitions as distasteful, as un-non-profitty, and I think that’s just nonsense. Most people who are running nonprofits in this country, good nonprofits, they know more about business principles than just about everybody who graduates from Wharton this year. They’re smart and savvy and they’re running high performing organizations on a shoestring budget and doing it with dignity and respecting their employees. They’re good business people. But I think we can still look at nonprofits and go, “Oh yeah, but you shouldn’t be trying to merge or acquisition or fold other people in kind of thing. You should just do your thing in your own particular lane and let the mergers and the acquisitions to the Silicon Valley firms or The Wall Street or something.”

I just think everybody should constantly be looking at their business model, should constantly be looking at the way they run their organizations and saying, “Is there a better way for us to do this? Would it work better if we were bigger? Would it work better if we took over that organization right there? Would it work better if we were able to get access to their donors?” And so I just think that the good executive directors and good boards have an obligation to constantly be looking for, “Is there a way for us to get bigger, better, faster?”

Julie Lacouture:

Yeah. And I think that bigger, better, faster, that’s definitely something that people think sometimes it’s not nonprofit in a way.

Trent Stamp:

Yeah. I think Liz and Venice decided, “Let’s go get it. It makes all the sense in the world.”

Julie Lacouture:

Yeah. That’s great. All right, let’s take a listen to your conversation with Liz.

Liz Forer:

I’m Liz Forer. I’m the CEO at Venice Family Clinic and our organization provides quality primary healthcare to people in need from the Santa Monica Mountains through the South Bay.

Trent Stamp:

Wow. Perfect. You certainly know your elevator speech. You’ve been doing it for a while, I know. And just so the listeners have a perspective on where you’re coming from, how many patients roughly do you guys serve?

Elizabeth Forer:

45,000 unique individuals.

Trent Stamp:

I think some people who don’t live in California sometimes when you say Venice Family Clinic, they think that it’s a shingle out on the road and that’s people who go in to see a doctor in the back. You’re talking about providing light saving services for 45,000 people, the size of a medium town. Clearly, you know where you’re coming from when you talk about how the system is working and not working.

Elizabeth Forer:

And 17 locations in the neighborhoods, two mobile units, [inaudible 00:08:36] that is an outreach team. We’re on the ground. We know our communities and the people we serve.

Trent Stamp:

Liz, one of the reasons that I wanted to talk to you is that your organization recently merged with another organization, South Bay Community Health Care. Can we just start at the beginning, and when did your organization start discussing such a merger?

Elizabeth Forer:

We started discussing the potential of a merger and more partnership about four or five years ago, and had been doing some partnering with various grants with South Bay Family Health Care around specialty care. We actually helped create a small nonprofit called Plunum Health, where we brought in our two clinics and two other clinics to work on projects we were finding difficult to do alone. And then as we were working together more, we said, “It’s time. Let’s see what it would look like to merge.” We started the process formally in the fall of 2019 thinking we would be done by July 1st, 2020. And with COVID coming in March, we all paused a bit. It took a breath and then started back up around summer and fall of 2020 in a more… It was a slower way, but we knew we were just going to keep working. We’re going to keep working and working on it until it happened.

Trent Stamp:

So in the early days, what did you do to prepare for the merger?

Elizabeth Forer:

We started off by really looking at both organizations to look at what we had in common and where our strengths were, where we could help each other. We had a committee made up of a few board members from each organization that walked through some of the key issues we thought we needed to discuss so that we could figure out if it was a go or a no-go. And really by February 2021, we had decided we could go and both boards had agreed to a formal merger agreement. It was a draft agreement.

And then from there, we began to learn all the things you need to do to legally merge. And in both the healthcare world and the finance world are extraordinary things that you do in which you call someone up and say, “How might we do this?” And they then hand you reams of paperwork to complete. And then you fill those out and then you say, “What else?” And they hand you some more, and then you keep moving. And we formed a very solid team in executing all of these things for the merger made up of our key people from south bank, key people from Venice Family Clinic who are in leadership. Most of those team members will now become part of our senior management team.

Trent Stamp:

So what do you think you gain from the merger? How is your organization stronger?

Elizabeth Forer:

Our organization is stronger because it provides us with the capability to continue to grow in the neighborhoods we serve, not only on the West Side, but into the South Bay, without any conflicts in terms of we’re separate entities. So it allows us to move into neighborhoods that have a great deal of need that prior to that, there’d be this question as to who belonged in those neighborhoods. Is this South Bay’s neighborhood, is it Venice’s neighborhood?

Trent Stamp:

Right.

Elizabeth Forer:

And this way we don’t have to go through that. It also allows us to really take a fresh look together at how our organization, which is stronger together, is able to move forward with change and increase services, especially in the South Bay in the areas of dental and mental health, and then expand the primary care, the excellent primary care that South Bay has been providing for many years.

Trent Stamp:

Do you lose anything by merging?

Elizabeth Forer:

The tricky part in the merge as you get bigger is to try to make sure that we keep the friendliness and community based nature of our various locations. And so the key for us is to look at the things in the cultures that we both bring that we like, maintain those things and look at the things that we think haven’t worked well and say this is a chance to try to change those things. What do we aspire to in those areas? We both as agencies have a reputation for being friendly, for places that you’re greeted when you come in, that people feel at home, they feel comfortable with our staff. They care for our patients. They want to help. We don’t want to change that. That’s the most important piece of what is at the core of Venice Family Clinic and the core of South Bay, and that’s also what helped bring us together.

So that’s a critical piece. It’s about caring. Ideally we will have the capacity to provide a broader range of services, continue our aspiration towards ensuring that people have very comprehensive care when they come to visit us, and that we’re also able to link our patients as needed into the broader community to the other services they qualify for and know what’s happened to them.

Trent Stamp:

So other than the voluminous amount of paper that was associated with this, are there things that you know now that you wish you knew when you first decided to merge? Did you learn things along the process that you didn’t anticipate?

Elizabeth Forer:

I would say since we decided to merge, every day has been a learning experience for many of us. And it’s helped us also partner with some of the governmental agencies we deal with in a much more hands-on way. So we all know a lot more people at entities, whether it’s at the county level or the state level, or the federal level in more intimate ways than we knew before. And I think that’s really helpful because it allows us to continue dialogues with them into the future. So that’s really excellent. The other piece that we learned is that our cultures are different in terms of our speeds. We phonetically like change at Venice Family Clinic, not change just for changes sake, but because we see something that works well and we want to make sure we can provide that because it might be better than what we’re already doing. So we’ve learned to be more patient, and in that there’s been able to be quite a satisfactory dialogue as we’ve moved ahead.

Trent Stamp:

One of the things that we’re guilty of philanthropy is telling nonprofits they should merge. “Your services are redundant. Why don’t you just merge with another organization?” Why aren’t there more mergers?

Elizabeth Forer:

It’s a very good question. I think sometimes it feels easier just to do it yourself. We know our staff, we know whatever, let’s just move ahead. One of my colleagues said to me, when he found out you were merging, “Congratulations. You managed to figure out a way to grow without harming your colleague clinics, without creating a competition, without all of that. You and Jann Hamilton Lee, who is now the former CEO of South Bay, have figured this out and that’s impressive.” And he said, “It’s a good example to us all.”

And the key is to recognize something here in LA county, if one out of three people is on Medi-Cal, which means that they qualify because they have a low income. And we also have a whole group of people who are uninsured, and the number of people that fall into these categories is fairly staggering, there is no competition. We can double and triple the amount of clinics that we have, community clinics across Los Angeles, and we’ll still have need to address. So we need to work together to do that, and we need to bring others in to do that.

Trent Stamp:

Yes, but there is competition for dollars and that’s why foundations are selfishly asking organizations to merge. It’s because then we could just make one grant and it would probably even be less to serve for the same number of people. And the obvious response from the nonprofit world is, “Why don’t you foundations merge?” And we all say because we’re different and unique and special, but I’m sure that every nonprofit would say the exact same thing. We’re all guilty of not figuring out better ways to align our services and you’ve done a fabulous job of merging two quality organizations to serve a large and growing vulnerable population. So I commend you for having the courage to do what was best for those you serve.

 So let’s talk about how Venice Family Clinic runs. The name of this podcast is How We Run and you guys are well known for running really well. What do you think makes your team run well?

Elizabeth Forer:

We run well because we like each other. Teamwork is really at the core of our organization, and without it, we wouldn’t be able to function. And it’s not just some teams from time to time getting together, it’s multi multidisciplinary teams. So we have regular meetings, but we also know when to huddle up with each other and who to talk to, to say, “What do you think of this? How might we do something? How might we work together on this with mental health and with our homeless outreach team?” Because of that, we run well. In the course of solving problems which a lot of the work is operational, people understand that they need to talk to each other about it, and that email isn’t always enough. And we’ve gotten very good using Zoom and using email. Now, we have more people back in the offices so that I’m seeing more doorway conversations again, and it’s nice to see that.

Trent Stamp:

One of the things that I’ve been asking people is what they’ve done at their organization to adapt to the changing environment. I can only imagine that everything that you have done in the last year and a half has been an adaptation and a change. But what’s one thing that you’ve done to adapt to the changing environment that you’re proud of?

Elizabeth Forer:

When we saw the pandemic coming, I don’t think we realized quite how much change we’d be looking at. There’s the obvious things that we had to do. We had to pivot to telehealth really quickly. We had to ensure we created a safe environment for our patients and staff. We had to figure out how to do testing outside. Now we have a whole series of services that are all done in tents. So we had to figure out how to do vaccinations for our staff, our patients, and our community. And all of that became a whole new line of business, which is our COVID business. And I would say most community health centers, all of us did that. We figured it out. We had at that time, a very small food program that was every other week offering fresh fruits and vegetables to very specific patients who were prenatal clients or diabetic clients.

And we turned and realized that program went from 300 people every other week to 600 people a week. Food Forward was our partner, then Westside Food Bank came in. When we hit the pandemic, we realized that this thing just had to grow. So within weeks, we were seeing 2000 people a week. And then we did that for several months and were contacted by UCLA Dining who said, “We want to keep our people working. We don’t have students on campus. We’ll pay the labor costs, can you pay the food costs?” And literally from September 1st, 2020 slowly started building that program. So we started with 500 meals a week, that went to as many as 13,000 meals a week. We provided more than 450,000 meals in the course of the year and then added to our Food Forward and our Food Bank Program, there is another 450,000 meals provided. So we just felt really great about the fact that we could feed the people who needed food and identify them as they came into our clinics with our food security questionnaire and get them appointments. And just seeing the relief on people’s faces-

Trent Stamp:

Do you feel like you’ll continue that food program?

Elizabeth Forer:

We have continued it with folks back at UCLA campus and they’re now feeding their usual 35,000 or 40,000 people a day. That part has stopped for now, but we are looking at carrying forward the prepared food piece with other partners and vendors. Maybe not at that level, it was getting more chaotic for us, but we do continue to provide food at all of our locations in the course of a week. And we continue to really monitor food insecurity in the people we’re serving, because it’s still very high. The food needs of the populations we’re serving now is higher than we’ve ever seen.

Trent Stamp:

Well, that’s tremendous work on your part. One of the things we like to do here is to bring on extremely accomplished people, leaders in the field and then ask them about a mistake that they’ve made and what you’ve learned from it. Is there a mistake that you remember in your career, a misstep, and did you learn something from it?

Elizabeth Forer:

I’ve made many mistakes. We’re all human. We need to learn from our mistakes and not beat ourselves up too badly, but sometimes the learning can be painful. When I was here maybe in my first five years, there came a point where we were doing many things and were very successful. And I noticed that our board at both committee meetings and at their meetings would say, “Liz, thank you for this work you are doing. Liz, thank you for making this happen.” And I realized that others in the organization were beginning to feel as if I was taking all the credit and that was not my intent. But a new board chair pointed out to me how I had written something and put my name on it. And he said, “You may have written this, but this is the work of everybody.” And I said, “Oh, you’re correct.”

And I didn’t mean it that way. I just meant that I’d written it so they knew who wrote it. I said, “Let me change that.” But I also started making sure that when people would say, “Liz, you did this.” I would say, “No, we did this.” And then I would point out the key people involved and the teams involved in it so that our board could give the recognition where it was due, and also that all of us began recognizing all the people involved. And it’s so important because in everything we do, if we’re working in team, there may be someone from time to time who’s spurring that team forward, but everybody at that team is working, and so they all need that credit and they need to be recognized for it. So it’s really important when success comes, to make sure everybody enjoys that success.

Trent Stamp:

That’s terrific. And obviously yes, we wanted you here today to talk about you and your organization, but we recognize that it is truly a team effort at Venice Family Clinic and in my interactions with your team, you have people who are selfless and do a great job. What’s your big idea moving forward, and how do you get there?

Elizabeth Forer:

As you know, we just merged and we had a lot of work to do, but what we’ve done to embrace our larger organization is a new initiative called The Power of Us. We’ve recognized that through the pandemic, we’ve been able to thrive and help others because the community has supported us in an above and beyond way. And we want to make sure we embrace that community and continue to all work together. We were founded as an all volunteer operation. We’re throwing our doors open to welcome our volunteers back inside as much as we can have people inside, and really looking at addressing how do we achieve health equity by building mental health access, controlling the pandemic and epidemics, defeating homelessness, ending hunger and fighting for children, and have very specific ways that we’re currently going about that but also ways we plan to do that into the future. And we’re very excited about doing this in our teams and across the communities and getting others involved in this work.

Trent Stamp:

Do you think that’s work that could then be replicated at other clinics in other communities? Is that part of your goal?

Elizabeth Forer:

I think it can be replicated. I think there are parts of it that many of us are doing. The example I’ll use around achieving health equity is really looking at the medical care we’re providing and ensuring that we have dental and vision and mental health healthcare that is in parity with that medical care that we’re providing. One piece that is hard to replicate. What important for us to look at is we want to really advance anti-racism in healthcare. It is critical. If anything, the pandemic has shown how badly people who have low incomes, people who are black and Latinx are treated by the healthcare system in this country. And it’s something we’ve always addressed, but never in as explicitly stated a way as it is now.

And we refer to it as health equity, but it’s really to say, we do not want any bias in our healthcare services. How do we ensure that our staff is aware of how each of us we treat each other, how we treat our patients? What is welcoming to one person may not be welcoming to another. We need to understand cultures and backgrounds, and we’ve taken on this work with great gusto. We’ve developed trainings that all our staff have done, and then volunteers from our staff have had training in how to do facilitation so that there are six or seven different groups, both work groups and discussion groups, focusing across our staff around reducing bias and creating a place that is against racism.

And then some of the work groups are working on when we look at our patient care, where are the biases? Where is the racism? What are the things that concern us? They’ve been interviewing patients. It’s a journey. It’s not a flash in the pan of, oh, we’re checking the boxes and being done. This has been going on in our country since its inception, and we need to address it every day and work hard. And it will really underlie as our culture of our joint organization. It is but the underlying concept that is critical to us.

Trent Stamp:

Yeah. I actually just want to personally thank you for making that connection for me. I usually ask guests how the world has changed for them and their adaptations to either COVID or to racial unrest, and you just made a very passionate argument that they are intertwined in the first place and that they’re not either/or, that they’re and, and that healthcare and the racism are intertwined. Thank you for making that connection for me, because I need to think about it a little bit better.

Elizabeth Forer:

I would add a critical piece too, is how do we create training programs so that any person going for healthcare can actually find someone that looks like them, that feels like them, that has experiences like them, who could be their doctor, their nurse practitioner, their physician’s assistant, their primary care clinician? The same in mental health and in dental and all of that. How do we really fling open the doors of an academic process that has really kept a lot of people up.

Trent Stamp:

Yeah. And that’s how you make long term sustainable change obviously. Thank you. So what’s your number one tip for a new executive director, someone in your position, someone who doesn’t have as much experience as you do? A management tip, a fundraising tip, a tip for growing your organization. What’s your number one piece of advice for the new executive director?

Elizabeth Forer:

Be transparent.

Trent Stamp:

That’s it. Boom. Transparent.

Elizabeth Forer:

Be transparent. If someone asks you something, answer it, be honest about it. If it’s tricky, explain why it’s tricky. We don’t have anything to hide here. We tend to share almost everything we do very openly, whether it’s our budgets or our secret stuff all as healthcare that are now at a curriculum on the website saying, “Please take this.” Just be transparent.

Trent Stamp:

Absolutely. Liz, thank you so much for being here today, and much more importantly thank you for a career of doing amazing work in the community and inspiring all of us. I really enjoyed our conversation, and I wish you the best.

Julie Lacouture:

We have a request for you dear listeners.

Trent Stamp:

I’m hoping that if you enjoy How We Run that you’ll go and leave a review for us. Your review allows others to find us, and that’s a good thing because the more people that listen, the more impact we can have on the sector, and then we can bring about positive change for other non-profits that are out there. So if you like what you’re listening to, please leave us a review.