Hookups Pay Off for Non-Profits

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Rock the Classroom, an L.A.-based elementary school literary program was having, yes, a rocky time.

The non-profit, which uses a music curriculum to interest kids in reading, lost half its funding over the past year as donations and grants dried up amid the recession.

Then it found a solution: The Edward Charles Institute for Nonprofit Mergers and Acquisitions, which as its name suggests, pairs up non-profits and oversees their mergers. Founded less than a year ago, the institute hooked up Rock the Classroom with the Woodcraft Rangers, a much larger and better-funded organization looking to expand.

“I think what they’re doing is quite amazing,” said Brad Kesden, executive director of Rock the Classroom, which couldn’t make its $450,000 annual budget. “It’s like a marriage made in heaven,” without which “we could potentially close.”

Beverly Hills Lawyer Kent Edward Seton and L.A. entrepreneur Robert Charles McKim, who’s founded several companies, said they started the institute whose moniker includes their middle names after hearing that up to 100,000 non-profits could close nationwide.

“We offer matchmaking,” said Seton, who estimates that as many as 2,000 charities have already gone belly up during the recession in Los Angeles County alone. “We’re getting more and more deals every day.”

Since opening, he said, the duo has completed three mergers or acquisitions and are working on six more. Services don’t come cheap, with fees ranging from $25,000 to $30,000 depending on the size of the deal. Usually the larger organization foots the bill.

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