Can AI Save NGOs Tons of Money?

November 5, 2024  ·  18 min 32 sec

Non-profits often have tight budgets and specialized needs—and wind up having to pay a whole lot of money for consultants and imperfect, out-of-the-box software solutions. As generative AI promises to drastically reduce the cost of development, how will that affect the non-profit and NGO landscape? On this week’s Reqless, Paul and Rich assess this question, and offer up both immediate and longer-term advice for organizations struggling with software right now. 

Transcript

Paul Ford: Hi, I’m Paul Ford.

Rich Ziade: And I’m Rich Ziade.

Paul: And you’re listening to Reqless, R-E-Q-L-E-S-S, the podcast about how AI is changing the world of software.

[intro music]

Paul: Richard, you and I run a company called Aboard. What does Aboard do?

Rich: Aboard uses AI to build software for companies and organizations very quickly. And it’ll build you the software you want in a very customized way very, very quickly. And it does that with AI. We couldn’t do this two years ago, and we can do it now.

Paul: That’s real. You can go to our website, you can check stuff out, you can sign up, try a little sort of baby demo of the product when you click on “try it”.

Rich: Mmm hmm.

Paul: But the way that Aboard really works is we partner with people and we, we build stuff with them using AI rather than just throwing them in front of a prompt, because we understand their business first.

Rich: AI is good at the easy parts, but we really gotta take it all the way through. And that takes some conversation. So we like talking to you, understanding what you need, and then we build it.

Paul: So today is a big day in America, when this is coming out.

Rich: Really??

Paul: It’s Election Day.

Rich: Congratulations, everyone!

Paul: [weary sigh] I’ve been going through it for about a year, and I’ll be glad to be on the other side of it.

Rich: Just to clarify for everyone, we’re recording this before Election Day.

Paul: Yeah.

Rich: So we don’t know the outcome.

Paul: And there are so many possible outcomes.

Rich: Many possible outcomes.

Paul: Yeah.

Rich: But you’ll hear this after Election Day. So everyone—

Paul: No, this comes out on Election Day. So, you know, if you haven’t voted yet, stop listening to this podcast and go vote.

Rich: Yes, go vote.

Paul: I voted already.

Rich: Yep.

Paul: Good for me. Okay, so what we thought we would do, because just about any topic is off-topic for today—

Rich: Yes.

Paul: —is something we don’t, people don’t talk about very much. I don’t know if you know this, but a big chunk of consulting and software and so on, development work and stuff that I’ve been around my whole career is not-for-profit.

Rich: Not-for-profit software.

Paul: Yeah, like—so.

Rich: Yeah, yeah.

Paul: And I’m not talking about, like, open-source. I’m talking about enormous numbers of not-for-profit organizations actually have enormous needs when it comes to custom software.

Rich: Well, I mean, first off, you need a good CRM to raise money.

Paul: Yeah. So there’s the basics.

Rich: [laughing] So there’s that.

Paul:  There’s like, they’re bringing money in. That’s right. There’s the basics.

Rich: That’s a job and that’s work.

Paul: Well, and that’s kind of indistinguishable from any subscription capitalist product. But there are other things. Like I’ve been around juvenile justice organizations and they do case management, they’re tracking kids in the legal system. There are science and cultural not-for-profits generate data sets, and then it is a nightmare because they put those data sets up, and then the software they use to host the data sets gets old.

Rich: Yeah.

Paul: And no one can access it—and so our friend Perry at data.org deals with some of this stuff and is trying. So I thought we could talk a little bit and just kind of riff in a friendly way for people who are constantly refreshing their phone trying to figure out what’s happening in the world today.

Rich: Yeah?

Paul: Here’s the thing. Here’s what I believe. And I want you to tell me—I mean, if you agree with me outright, you, this will—

Rich: I probably won’t. But go ahead.

Paul: So you go into a not-for-profit and they tend to be kind of bureaucratic by default, and they have large software needs.

Rich: Yeah.

Paul: And they have mid-sized budgets, about a quarter of what a for-profit enterprise tends to have.

Rich: Sure, sure, sure.

Paul: But their dreams are just as big. And so when we used to work with not-for-profits at the agency, there was just a certain amount of, like, hope-shattering that was built into it.

Rich: Kind of always.

Paul: Well, because what happens, and the worst thing you can do when you are writing a proposal for an NGO is do them a favor.

Rich: Yeah.

Paul: Because they get really excited by the low price.

Rich: Yeah.

Paul: But they don’t set their—but software just doesn’t work that way. You’re like, okay, I know that somehow we’re all going to work together and we’re going to create the case-management tool or the data-provider thing or whatever the hell is the most important thing. And it’s also really important to get this stuff, because unless it ships, they can’t get their next round of funding—

Rich: Yep.

Paul: —from their, from their sponsors, and on and on. So the worst thing you can do is say, I’m going to get this for you almost—it’s going to be so cheap, it’s going to be so great.

Rich: Well, I mean they do expect a break from full retail because they’re not-profit, not-for-profit.

Paul: Yes. But it’s a percentage. It is not a big, it’s not three—

Rich: No.

Paul: What they want is three quarters, and what you can give them is like 15%.

Rich: Maybe. I mean, I don’t know. I think Salesforce has like a, ah, they have, it’s documented, right?

Paul: Salesforce has a large hoard of gold that a dragon sits atop. So they’re doing, they, they can do whatever they want.

Rich: They can do whatever they want. But I think what’s interesting about not-for-profits is they’re mission-driven. For-profit companies, they can have different missions and then make money, but the unspoken mission of all of them is to make money.

Paul: Yeah. To the point that the mission can just outright change if you find another way to make money.

Rich: Yeah. Make money, right? And for a not-for-profit, the idea of infrastructure bolted onto a mission?

Paul: Yeah.

Rich: Is a strange thing. Right? Like, they’re just trying to get things done. They’re not, they’re rarely excited about software. It’s sort of like, well, I can’t, I can’t achieve the goals of the mission. I can’t—

Paul: It is true.

Rich: Without the thing, so I need the thing, please, if you don’t mind. [laughing]

Paul: It is true. The IT and services department is rarely the star of the show at any big org, but in the NGO, it is, like, off in a corner.

Rich: Correct.

Paul: Now here’s—so here’s what we’re getting to today, right? Let’s go back. Okay, you are a NGO and you want to change the world and you want to manage…you have people that you’re trying to get out of jail. There’s 5,000 people you’re trying to get out of jail and you can get, like, three out of a week if you’re really, you know, like, just by doing a certain thing with data—it’s kind of like CRM, but it’s, the focus is getting out of jail. It’s very custom. There’s privacy, there’s security, there’s profiles, photos, uploads, etc.

Rich: Sure.

Paul: So you used to come to me and I would say—let me, that’s the problem. I have 5,000 active records and I have a team of 20 that works with them, and a lot of them are lawyers, and there’s privacy. What would that—at the agency, what would you have told me? How many months? Roughly how much?

Rich: I used to do this really awful thing at the agency, which I’ll share the trick now for everyone. I always used to tell people, listen, for someone else, I would have charged this.

Paul: Yeah. [laughter] Yeah, that is a good one. That’s a classic.

Rich: Well, it’s, it’s sort of a framing. I was like, let me paint doom around you first and then we will get to you.

Paul: It is, if you’re willing to let them squirm for a minute, and you tell them, like, something that’s about 2X what they were expecting?

Rich: Yeah. And I used to say, even for for-profit companies that were smaller, I’d be like, listen, if you were a big bank, I would have charged you this. But I like you.

Paul: Yeah. That’s right.

Rich: I like you. You’re a nice guy.

Paul: Honestly, you make it sound cynical, but it is genuine. We did like them more than large banks a lot of the time.

Rich: And also—

Paul: Then again, we liked a lot of large banks, too.

Rich: Also, you can, you can do well and make money with smaller organizations. I think with not-for-profits, the money bit is the cost of it, the time required, the energy required. Those are all like kind of strange details on the fringe of what they’re trying to be and what they’re trying to do. It’s sort of like, we gotta furnish the office, right?

Paul: It’s also the internal culture of the NGO is very much, like, you should be doing more.

Rich: Yeah, yeah.

Paul: Right? So you’re selling your services to people. When you sell your services to a big bank, the big bank, people are thinking, this could be really cool. I could be really proud of it. I also am, like, looking at a really nice Airbnb, where I’m gonna go in, like, Italy.

Rich: Yeah.

Paul: And that’s fine. You guys are gonna do your thing, we’ll do our thing. The NGO is like, I got to get it, it’s six months late, and I expect everyone to work 800 hours a day.

Rich: We’re painting a pretty grim picture here—

Paul: Here’s what I’m getting at. But it’s still hundreds of thousands of dollars for something like what I described.

Rich: Okay.

Paul: In ye olden days. Okay. AI is here. AI can go really fast.

Rich: Yes.

Paul: What I want to do here is advise the software buyer on the NGO side. Okay? You’ve been going to consulting firms and boutiques and independent teams, and they’ve been telling you half a million dollars, six months.

Rich: Yes.

Paul: At the very base. Okay? And it’s going to be built on top of Salesforce, because it’s kind of like a CRM, and we’re going to do these six separate things on that.

Rich: Yes.

Paul: And you can say yes or no or try to—now AI is here. Okay, Rich, you’re my consultant. Tell me how I should look at it. I work for keepemoutofjail.org.

Rich: I would be first very optimistic about the fact that the cost of getting you what you need should go down drastically.

Paul: What’s, what’s drastically mean, right now, today, in your head?

Rich: 70% off.

Paul: That’s kind of where I’m at, too. It’s not 90.

Rich: No, you…

Paul: But it’s more than half.

Rich: We still need humans and there’s still work to do and there’s, it’s nudgey and annoying. But I have bad news. It’s too early.

Paul: Yeah. This is real.

Rich: And the reason I say it’s too early is because right now what I see happening is that AI is being viewed through a sort of craftsman’s tools lens, or perspective. Meaning there are skills out there that can be accelerated.

Paul: No, no. If you’re a software architect and I give you a puzzle.

Rich: Yeah.

Paul: And you’re good at breaking puzzles like that into individual software modules with inputs and outputs and documentation.

Rich: We can do it faster.

Paul: You can tell Claude or ChatGPT to do it for you and you can accelerate sort of shockingly, like it’s a real, like that might be a—

Rich: It’s a great tool.

Paul: 90% acceleration.

Rich: Great tool. Now, where we’re not at is there isn’t an ambassador or sort of a liaison that is connecting the world of experts who are now working much faster to organizations like not for profits to tell them, “Hey, I got good news for you, dude—or ma’am. We can do this for you much, much cheaper. Because the tools in our hands now are providing us with incredible efficiencies and we’re shipping quality much more quickly.” That hasn’t happened yet. It’s coming. It just hasn’t, it’s not there yet.

Paul: I can break that down even further, right? Like you, if you are an NGO and you wanted to take advantage of AI today.

Rich: Yeah.

Paul: You would need access to a world—and you had a real problem, like an actual thing you wanted to build, you would need access to a very, very good software architect.

Rich: Yes.

Paul: Now, a very, very good software architect is somebody who makes between $180K to $360K a year, right? It’s not an easy hire. And they’re busy.

Rich: Yeah.

Paul: So you’ve now got a real, you got to get that person. And then they would have to be like, I want to work on this and we’re going to break it up and I’ll work with a couple junior engineers. I still need design, I still need like, like…

Rich: Yeah.

Paul: So we’re able to scale—what we’re able to do very, very quickly now that we didn’t used to be able to is describe kind of like data coming in, data coming out, or do it with this interface or whatever and get a code result really quickly.

Rich: Mmm hmm.

Paul: What we’re not truly able to accelerate is the architecture of the overall platform. The look and the feel—like, things are happening, but they aren’t happening at the same rate that code is happening.

Rich: No, they’re not. And—

Paul: And actually, just to nail it down, a lot of the work, let’s say the number was $100. You might think for a big code project, that $90 of the $100 are writing code.

Rich: It’s not.

Paul: It’s more like 60 to 40. Like, it’s in there sometimes—

Rich: There’s a lot of other work that has to go on.

Paul: Right. So it’s early, but I do—

Rich: It’s too early.

Paul: I do want to do this. I do want to find a way to rebuild this system that we built on, you know, Salesforce or whatever, Visual FoxPro.

Rich: Yeah.

Paul: And I want to get it done and out into the world. And you’re telling me I have to wait. What am I looking for?

Rich: It’s a great question. I say, probably the one recurring theme that I come back to, and we’ve been doing different, we’ve put different stickers on it, but it’s the same podcast for, like, almost 10 years now.

Paul: Yeah. We’ve only had one conversation.

Rich: We’ve only had one conversation.

Paul: Yeah.

Rich: But there’s one thing that I say consistently. Advancements in technology do nothing but eliminate steps. That’s all they do. Where we are not today is I can’t just ask an AI prompt. I can’t just tell it what I want and not worry about the rest. The further down the stack, the further along, the more detailed I am, the better it’s going to do today. I think as AI progresses, I’m going to be able to say things like, “Show me a picture that’ll cheer me up.” Like, very high-level. Or, “I run a nonprofit that advocates for incarcerated individuals, and I need a better way to track them.” Stop. Now, all the stuff that has to happen underneath—the tools, the data, the architecture, the interface, does it work on my phone, the code, finally, all of that stuff. Right now, we are not at the point where we could just ask at the top level, “I’m hungry. Give me something delicious.”

Paul: It will give you—you can ask it for an architecture and for it to recommend platforms when you describe it—

Rich: You know—

Paul: There is that.

Rich: The one thing you have to give AI credit for at this early stage—

Paul: Shameless. Shameless.

Rich: It’s just going to give it a go.

Paul: Yep.

Rich: It’s going to try. But it’s not going to solve your problem.

Paul: Okay, so what we just described is essentially a large app platform dealing with very private data. Here, let me, let me throw something, though, where I think you could move a lot faster. Let’s say, I think CRM could move a lot faster if you were tracking leads and people.

Rich: The narrower the ask, the better it’s going to do.

Paul: Let’s say you had a spreadsheet with a big listing of all of your constituents, right?

Rich: Yeah.

Paul: And you had like a little budget for each one. And you sum it up, and, like, five people are working on that spreadsheet.

Rich: Mmm hmm.

Paul: That is a, you could turn that into a website that people could be using.

Rich: Yes. The narrower the surface area, the more reliable the AI acceleration is going to be. But when you ask for something like, “My team is not working efficiently right now at my not-for-profit. Can I, can we—what can we do better?” It’ll give it a go, but—

Paul: You know what’s—

Rich: But it could go bananas.

Paul: You know what’s real about what you just did there is I came in with, like, kind of a software architecture, even when I’m saying it.

Rich: Yeah.

Paul: Most people don’t have that when they, they’re like, “I would just like to save money,” or, “We have to replatform,” or, “Bloomberg gave us $2 million to fix this.”

Rich: The not-for-profits are the gold standard of the pragmatic non-technical ask.

Paul: Yes, that’s right.

Rich: More than any business that brings in their CTO or whatever. They’re like, “I can’t seem to keep track of all the library stuff.”

Paul: That’s right.

Rich: “Can you help me?”

Paul: Yes.

Rich: And believe me, there’s a lot of consulting firms, there’s a lot of companies, there’s a lot of products out there that would love to take their money, because that buyer is just in pain. They don’t have a specific, you know, prescriptive idea of what, how to solve it, right?

Paul: But here’s the thing, and I want to close out on this, which I think is, this is real. If you work at an NGO and you are a software person.

Rich: Yeah.

Paul: You should be leaned in on this because there is absolutely a chance that you can save your org 70% on the next big project.

Rich: I think that’s right. You should keep a lookout for it. We’re not there yet.

Paul: Yeah. And actually, I’ll throw it out. Like, we’re getting an office. If you want to host, if you will host that event, if people want to get together and talk about different tools and ways to do it.

Rich: I think it would be fun.

Paul: You know, I’m also just, like, who knows how today is going as people are listening, like a little something positive. Let’s—

Rich: Yeah.

Paul: If you’re doing something good for the world, we’ll try to help you out. You can be in touch.

Rich: Tools represent a sense of control.

Paul: Yes, that’s right.

Rich: In forward motion and productivity, and that’s a healthy thing in this current environment that we’re in, no matter what’s happening.

Paul: But I do think, like, it’s, it’s a funny thing, because this world—the other world that is far away, we talked about on the last podcast. Government is kind of engaging. But this tactical thing that we’re talking about, which is, get a broad requirement that has some budget next to it.

Rich: That’s it.

Paul: And then figure out how to turn that into an architecture and turn that into a product. That process doesn’t really exist. There’s a lot of tools where they’re, like, we’ll help you build in five seconds.

Rich: All kinds of promises.

Paul: So one of the reasons, actually—this is not me marketing, we did that earlier—but it’s one of the reasons why our product has kind of kept going back to, we’re going to have a conversation first. You’re not just going to dump stuff in the box. We’re going to talk with you about your needs. Then we’ll use AI in front of you.

Rich: That’s right.

Paul: To help you build your thing. We’re not going to hide the fact that we’re taking advantage of the new technology.

Rich: And we’re not marketing.

Paul: No, this is real.

Rich: This is—conversation we think is integral to great products.

Paul: We’re actually making a very bad business decision, as former agency owners, because what we’re saying is we’re going to focus on this product and the money we’re able to make, we’re going to pass the savings on to you rather than try to obscure the savings and say we delivered the value.

Rich: That’s right. That’s right.

Paul: We’re going to show you where ChatGPT and OpenAI—

Rich: I think we’re not there yet. I don’t think anyone’s picked up this template yet. Bbut I think there are going to be a lot of firms that do that. I think that’s coming.

Paul: I don’t think there’s a choice.

Rich: [laughing] I don’t think there’s a choice.

Paul: No, because there is a point where people go, like—

Rich: Yeah, yeah, yeah.

Paul: —these guys said they would do it for $5.

Rich: Right.

Paul: Right?

Rich: Exactly.

Paul: So, and I mean, uh, you know, what is coming is the world where someone on Fiverr will build you a mobile app.

Rich: Oh my God.

Paul: Using AI. No, that’s coming.

Rich: It’s coming.

Paul: I bet it’s there. Somewhere in between that, if you are an NGO, get in touch, start looking at this stuff.

Rich: Yeah.

Paul: But also assume, you know, we’ll host an event, we’ll get you sliders.

Rich: Yeah.

Paul: We would love to see you, and then assume significant, like, more than half of your IT budget for a new, big new platform could be cut. And assume that you could start to build little things first before you go do the big thing and see how this works.

Rich: I think that kind of, I think be ready to push back. When you get that ridiculous quote, be ready to push back. The world’s changing. It’s not, it’s like just started. Like, we’re just at the beginning.

Paul: But I would say if you have like a $1.5 million Salesforce implementation across your giant multi-thousand person org? I would pause for a second and just think.

Rich: Yeah, I think that’s real.

Paul: I think the next six months are going to see a real acceleration.

Rich: Yeah, I agree.

Paul: Okay.

Rich: I think this is general advice, by the way.

Paul: It is general, but just for—this world is so constrained and struggles so.

Rich: Yeah.

Paul: But yeah, it is general advice. It’s coming for everybody.

Rich: I hope everyone’s happy today.

Paul: Today is a great day for America, I hope. [laughter’ All right.

Rich: Have a wonderful week, everyone. Reach out at hello@aboard.com, we love talking.

Paul: Thank you for listening to Reqless and we’ll talk to you soon.

Rich: Bye.

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