#340- Scaling an Organization to 7 Figures with Jehron Petty

Summary

Nonprofit Lowdown Episode #340: Scaling an Organization to 7 Figures with Jaron Petty

Release Date: June 2, 2025
Host: Rhea Wong
Guest: Jaron Petty, Founder and CEO of ColorStack

In Episode #340 of Nonprofit Lowdown, host Rhea Wong engages in a deep and insightful conversation with Jaron Petty, the visionary founder and CEO of ColorStack. The discussion delves into the remarkable growth and scaling of ColorStack, a peer-to-peer support network for Black and Latino computer science (CS) students, highlighting strategies, challenges, and invaluable lessons learned over five years.

1. Introduction to ColorStack

Rhea kicks off the episode by reintroducing Jaron Petty, a former student of hers, emphasizing his journey from a Cornell undergrad to leading a thriving nonprofit.

Jaron Petty [01:00]:
"I built this kind of flywheel community of people helping each other, really creating those spaces for them to feel like they belonged in CS."

ColorStack originated as a passion project during Jaron's time at Cornell University, addressing the confidence issues among Black and Latino CS students rather than access problems. What began as small intentional efforts, such as targeted office hours for Black students, rapidly scaled into a national network boasting over 15,000 members—a testament to the pressing need and effective execution of the initiative.

2. Organizational Growth and Current Impact

Over five years, ColorStack has achieved significant milestones, maintaining a stable budget and expanding its team.

Jaron Petty [02:44]:
"We have a full-time team of eight employees and a couple part-time folks, serving over 10,000 undergrads."

With a fiscal budget of approximately $2.4 million, ColorStack sustains its operations through a balanced mix of earned revenue and philanthropic funding. Notably, the organization supports an estimated 10% of the total Black and Latino CS student population across the United States, positioning it as a critical resource in fostering diversity within the tech industry.

3. Revenue Models: Earned Revenue and Philanthropy

A central theme of the discussion revolves around ColorStack's innovative revenue strategies. Jaron explains how the organization initially thrived on earned revenue by partnering with companies investing in hiring their members, providing financial stability and growth flexibility.

Jaron Petty [05:52]:
"I had to learn how to build both an earned revenue model and the philanthropic fundraising kind of engine."

Currently, about one-third of ColorStack's budget stems from earned revenue, while the majority is supported by institutional philanthropy, with individual donations comprising approximately 5%. This diversified revenue stream ensures year-over-year predictability and resilience amidst economic uncertainties.

4. Navigating Leadership and Staffing Challenges

Transitioning from a founder to a CEO presented unexpected challenges for Jaron, particularly in staffing and managing a growing team.

Jaron Petty [13:42]:
"Everybody wants to be a founder until it's time to become a CEO."

Initially favoring young, enthusiastic recruits, Jaron realized the importance of experienced professionals to sustain and mature the organization. Partnering with Greenline Talent Group for hiring processes marked a turning point, ensuring that new team members were not only skilled but also a cultural fit, thereby enhancing organizational efficiency and harmony.

5. Building a Robust Community

ColorStack's exponential growth is attributed to several factors, including recognizing a significant market gap and leveraging personal networks effectively.

Jaron Petty [19:00]:
"There was clearly a gap... Nothing could serve any Black or Brown CS student on a large scale."

Jaron's active presence on LinkedIn and his ability to mobilize a substantial initial following facilitated the rapid scaling of ColorStack. The pandemic further acted as a catalyst, pushing virtual community-building to the forefront and enabling seamless expansion across diverse campuses without geographical constraints.

6. Addressing DEI Pushback in Corporate Partnerships

The episode also touches upon the current climate of pushback against Diversity, Equity, and Inclusion (DEI) initiatives at the corporate level and its impact on ColorStack.

Jaron Petty [22:07]:
"There are some companies that are holding up deals because of our mission."

While some corporations are retreating from DEI commitments, others continue to invest, creating a mixed landscape. Jaron emphasizes the importance of diversifying funding sources, particularly by bolstering individual and philanthropic contributions, to mitigate the volatility introduced by corporate hesitations.

7. The Role of AI in Nonprofits

When discussing the future, Jaron highlights the transformative potential of Artificial Intelligence (AI) in the nonprofit sector, particularly in enhancing operational efficiency and workforce development.

Jaron Petty [24:43]:
"AI is a tool that increases your capacity. Use it responsibly."

By training his team to integrate AI thoughtfully, ColorStack aims to streamline processes and better prepare students for an AI-augmented job market. This proactive approach ensures that members are equipped with the skills needed to thrive in evolving tech landscapes.

8. Impact of Rhea Wong's Mentorship

Jaron reflects on his collaboration with Rhea Wong, attributing significant organizational growth to her mentorship and strategic guidance.

Jaron Petty [28:14]:
"The mindset shift of 'you don't get money if you don't ask' transformed our fundraising approach."

Under Rhea's guidance, ColorStack transitioned from hesitantly seeking donations to actively making strategic asks, resulting in substantial philanthropic contributions—raising ColorStack's budget from $500k to over $1.2 million within a year.

9. Conclusion and Final Insights

The episode concludes with mutual appreciation between Rhea and Jaron, underscoring the importance of strategic fundraising, community building, and adaptive leadership in scaling a nonprofit organization successfully.

Jaron's systematic, computer science-informed approach to problem-solving and growth has been instrumental in ColorStack's success, making this episode a valuable resource for nonprofit leaders aiming to scale their organizations effectively.

---

Notable Quotes:

• Jaron Petty [08:04]:
  "No money, no mission."

• Rhea Wong [10:51]:
  "It's like your minimum viable product."

• Jaron Petty [24:57]:
  "Someone who knows how to use AI is going to take your job."

• Jaron Petty [28:47]:
  "You don't get money if you don't ask."

For more insights and resources shared in this episode, visit riawong.com.

Transcript

[Rhea Wong]

Hey, you, it's Rhea Wong. If you're listening to Nonprofit Load On, I'm pretty sure that you'd love my weekly newsletter. Every Tuesday morning, you get updates on the newest podcast episodes. And then interspersed, we have fun special invitations for newsletter subscribers only and fundraising inspo because I know what it feels like to be in the trenches alone. On top of that, you get cute dog photos. Best of all, it is free. So what are you waiting for? Head over to riawong.com now to sign up.

[Jaron Petty]

Foreign.

[Rhea Wong]

Welcome to Nonprofit Lowdown. I'm your host, Rhea Wong. Hey, podcast listeners, Rhea Wong with you once again with Nonprofit Lowdown. Today I am excited because once again I get to have one of my former students on the pod to talk about impact growth. It is my pleasure to welcome my friend, Jaron Petty. He is the founder and CEO of ColorStack. And today we're going to talk about growing real fast. So tr, welcome to the show.

[Jaron Petty]

Thank you for having me. Good to see you again.

[Rhea Wong]

Good to see you. So before we jump into the whole thing, tell us a little bit about Color Stack, which I know came out of a passion project when you were still at Cornell as an undergrad.

[Jaron Petty]

Yes. So I studied CS at Cornell. Thanks for calling it out. I basically, over the course of my time there, was honestly frustrated with the state of things. Right. I had friends who were dropping computer science, thinking of leaving the major, not achieving their potential fundamentally. And I realized that it was a confidence problem, not an access problem. Because we were at Cornell. Right. You have all the professors, all the education, all the resources you need in the world. Why were these students feeling like they couldn't do it and poured into them myself and built this kind of flywheel community of people helping each other, really creating those spaces for them to feel like they belonged in cs. I even did things like when I became a ta, I sent out a availability link to all the black students and was like, when are you available? That's when I'll have my office hours. And so those intentional small things early on that then scaled into a club that I was leading and then eventually became Color Stack, which is now a 15,000 member National Peer to peer support network for black and Latino CS students.

[Rhea Wong]

Amazing. Okay. There's so many things about what you've done that is just really incredible. One, you started this thing in the height of the pandemic.

[Jaron Petty]

So.

[Rhea Wong]

So what, May 2020?

[Jaron Petty]

Yes. When I was supposed to graduate.

[Rhea Wong]

Yeah. Like people weren't thinking, you know, what I should be doing, starting a nonprofit at this point you're five years old. So congratulations and tell us how big the organization is now in terms of budget size, in terms of employees. And you told us you're serving 15,000. Yeah, black and Latinx computer science students. So that's incredible.

[Jaron Petty]

Yeah, yeah. So we're definitely, we're excited to celebrate five years of impact. My friends and family will tell you that just from my personality, they didn't expect me to commit to anything for five years. So this is just every year after year one was like, wow, Jerome's still doing it. So I'm thankful and really impressed with all the students and their success and thankful to the team we have. Our budget going into this to end of this fiscal year is 2.4 million. We're probably going to stay, we were going to grow a little bit, but we're probably going to stay around the same amount going into this next fiscal year just with all the uncertainty in the world. We have a full time team of eight employees and a couple part time folks. And yeah, across 15,000 members, I think a month or two ago, 10,000 of them are undergrads. We have estimated over 10% of the total black and brown CS student population. So 1 in 10 black and Latin LCS students that you meet will probably be in Cul Stack.

[Rhea Wong]

So you're basically sitting on a community of unicorns because I imagine all of these tech companies are lining up to talk to your folks.

[Jaron Petty]

Yeah, yeah. That's how it's been from day one.

[Rhea Wong]

Amazing. But tell us a little bit about yourself because you didn't come from a fundraising background. Like you didn't have nonprofit experience. You were a computer science guy. So what is it that you've learned in the last five years?

[Jaron Petty]

Yeah, totally. So background on my business side, I started my first business in high school actually I was fixing phones, customizing. Back in the era where everybody's phone screen cracked every week, Otterbox cases were more of a thing than they are now. So that was actually the first time I had a, a little bit of a taste of entrepreneurship. Right. Something offering a service, charging for that service, trying to prioritize a customer, selling yourself, marketing yourself. So that was always there. And then I chose to study computer science in college, learn how to build software, Internet, top tech companies. And so it was that experience that I explained at the beginning of the call, plus that kind of foundational entrepreneurial predisposition, I would say that led me to build an org and like at least know or be comfortable with what it takes in the early days, I had a lot to learn, but I was so comfortable trying new things, failing very quickly and getting back up and trying again. And so what I didn't realize or what I had to learn early on was just how do I build both an earned revenue model and the philanthropic fundraising kind of engine? Right. So we were lucky enough to be in part of the pipeline where companies will pay us to hire our students and that's part of their recruiting budget. So we had this very healthy earned revenue model that we were operating at a surplus with for the first three years. But as we continue to grow and scale, not that we reached a ceiling, but there was definitely more impact that we wanted to drive that philanthropy came in and helped us do. And so learning that game after doing the earn revenue game for three years was a whole different, not a whole different world, but it's just like you need to. It's a different muscle. Right. You can't use the same processes that you're using before. So I had to learn that a lot. That's actually the time two, three years ago when we, when I did your course.

[Rhea Wong]

Okay, yeah, we're definitely going to get into that. But yeah, of Your use a 2.5 million budget, like how much of it is earned? How much is philanthropy? And of the philanthropy, like how much is foundation versus individual versus anything else?

[Jaron Petty]

Yeah, great question. So off top, this current fiscal year that we're in, things are still coming in, but about a third of that, a little bit over a third of that is going to be our earned revenue. And then a majority of the rest of it is going to be institutional. I'd say under a little bit, under 10%, maybe call it 5% is more individual. So the big fish is definitely going to be for us, institutional. But that earned revenue does give us this sense of year over year security and predictability with our revenue.

[Rhea Wong]

Oh, you're speaking my language. Also, you need to come back because we need to up your individual giving line.

[Jaron Petty]

That's a whole other direction.

[Rhea Wong]

We're going to put a pin in that one.

[Jaron Petty]

Yeah.

[Rhea Wong]

Okay. I think it's just incredible. You were a college grad, no background in fundraising or nonprofits. You decided to scratch your own itch because of the problem that you saw. Looking back five years since the founding, what have been the biggest challenges and the biggest, let's call it, lessons learned in the five years.

[Jaron Petty]

Yeah, totally. On fundraising or just in general?

[Rhea Wong]

Just in general building an organization. Because this is a pretty high fast growth organization like most nonprofits aren't at the $2.5 million mark in five years. So I would say that you're abnormally fast.

[Jaron Petty]

I appreciate that. I appreciate that. We're very thankful. I. One of the biggest things that I've learned and less kind of the challenges in building this org or actually, let's just talk positive first. The good thing that I focused on very early on was revenue from day one.

[Rhea Wong]

Yeah.

[Jaron Petty]

Especially as a nonprofit. Think about where you're going to get your money from. Because the impact part I already figured out, like, I already knew the model because I was doing it at Cornell. So I was like, I already knew what I had to figure out there, and I already knew how I was going to execute that. And so when I launched Color Stack, because of that pre work effectively, I could almost strictly focus on, yes, the model, but mainly like, how do we get people to fund it? And so my first year was raising that quarter million, half a million of corporate sponsorships. I was able to get that early, and then they became renewals, and it gave us a lot of flexibility to grow. So that was great. Like focusing on. Yes, here's the impact that you want, but mainly after that. Okay, how. What's the model here? What are people buying?

[Rhea Wong]

So good.

[Jaron Petty]

Was. So yeah, that was a huge thing early on. Second lesson that I learned hardly.

[Rhea Wong]

Can we pause that on one second? Because I just. I feel like that's such a powerful point. All of the folks that I've worked with, all the most successful founders or CEOs or are the ones who focus on the revenue because at the end of the day, no money, no mission. So I'm curious for you, and I think this is. This tends to be a little tougher for founders because founders got into the thing because they love the. I call it hugging the panda bears. Right. Like they hug the panda bears. But in reality, your job is to fundraise. So how are you able to thread that needle to recognize that, like, your job was actually to raise the money, not to hug the panda bears?

[Jaron Petty]

Yeah, it's a great question. I think for me personally, I, you know, my mom has a. As a finance background, she raised me up on. On spreadsheets and then the numbers.

[Rhea Wong]

Good job, Mrs. Eddie. Your son is out here doing the thing.

[Jaron Petty]

But for my first business, she actually made me a cash flow statement. And like, all these things I was using.

[Rhea Wong]

Love it.

[Jaron Petty]

So I've just been trained on numbers. Like, I. To your point, no money, no mission in life, especially in this type of society that we're living in. I know that without money, nothing is possible. And especially in a business context. That's true. And so I just had that kind of default mentality from some of those early learnings and early support and guidance and mentor for my mom. But yeah, like the way that I thought about the early days was I did so much work. And this is actually a good point that I want a lot of potential nonprofit founders to think about. There's a lot of people that want to start a nonprofit. Right. Because of what you're saying. It's I want to help the world, I want to change the world. I want to do all these things. I was changing the world part time for four years. Like I was doing work in my free time to help students fulfill that mission. I think a lot of people want to just have the. I want to get my 501c3 status so I can raise money. Yes, that's true. But also, if you could just try to do the work, volunteer for the similar orgs that are already in your space and try to drive that impact, you will learn so much. But also you might realize that maybe this is all I need. This is all I need to do. When people jump to try and found the official entity versus it naturally progressing as it did for me, I wasn't thinking about starting a nonprofit, just naturally progressed over the four years. I think you're able to then be more realistic about what's possible.

[Rhea Wong]

I'm literally sitting here nodding my head because I've said the same thing. Because I think I know you tech people call it your minimum viable product.

[Jaron Petty]

Right? Yeah. I didn't know if I could bring that stuff.

[Rhea Wong]

Yeah, bring minimum viable product. Because I think someone is out here being like, I gotta build the whole spaceship. And you're like, do you?

[Jaron Petty]

Yeah.

[Rhea Wong]

And I think the mistake that a lot of people, they make or they're just not really realizing is that when you start a nonprofit, you're starting a small business.

[Jaron Petty]

Yeah.

[Rhea Wong]

And I think they think it's about petting the panda bears, but actually it's about making a business work.

[Jaron Petty]

Yeah, 100%.

[Rhea Wong]

So I'm, I'm here for that minimum vial product, 100%. But the other thing that I want to point out is you had early traction. Right. So you had already proven that this was a need in the community. You'd already proven that it could work before you went ahead and started this whole thing. So.

[Jaron Petty]

Yeah, I think a subtle piece too, to that, to your point about traction and to your point about. Yeah, I guess just the Idea of hugging the bear, panda bear kind of thing. What was the phrase?

[Rhea Wong]

Hugging the panda bears.

[Jaron Petty]

Hugging the panda bear. I never heard that phrase.

[Rhea Wong]

Everyone wants to hug the panda bears. Nobody wants to raise the money to.

[Jaron Petty]

Hug the panda bears. Right. I love that phrase. So I think part of what you gain as a potential founder from just doing the work in that MVP way without an entity, without a formal structure, to your point, is that I actually filled that cup. I filled the cup of hugging the panda bear because I did it. And so now it's not that I'm striving to get that feeling. I get. I've gotten it already and will continue to get it. But now I have space to think about the business side because I've scratched that itch, as you said earlier too. So I think that there's another reasoning why you should go for the MVP first. Because if you think about all this impact, let's drive that. Let's figure out a way for you to drive that and fill your cup in that way now.

[Rhea Wong]

Yeah.

[Jaron Petty]

Because then you can like come off that high for a second and realize that you need to start a business.

[Rhea Wong]

Yeah. Look, and here's the other thing too is I know for a lot of folks hugging the panda bears is a thing that gives you fuel. I'm not saying don't hug the panda bears. What I am saying is be strategic. So if you know that your cup is going to be filled by having some kind of, some kind of opportunity to be involved in the program, do that. But not at the risk of doing the thing which is building an organization.

[Jaron Petty]

Totally.

[Rhea Wong]

Let's talk about staffing, because I know that is often some of the biggest. I'll just say for myself, it was one of the toughest things. Right. Finding the right people, getting them on board. And frankly, when you're the founder or when you've been at the beginning, I think for me the frustration was like, I have literally done everyone's job. So it was very hard for me to find people that I felt could do it at or above the level that I wanted it done or really just finding people that were a fit in terms of culture, salary and skill set. So talk to me a little bit about how you're thinking about staffing because an eight person team is not compared to the one that you are by yourself. It's 8x.

[Jaron Petty]

Yeah, 100%. I that going back to even your earlier question of what is, what have I learned, what's been challenging? I think everybody wants to be a founder until it's time to become a CEO. And I think that change is once you have to actually run a company and hire people and you're responsible for a budget and people's livelihood. And so that the amount of time I would focus on things that aren't fundraising and building the program model was a surprise to me too, of just like how much working with people and organizing a team is. It can just not be about the actual work and it's more about emotions and managing drama and people not being a fit for whatever different reason and all of that stuff. And so we've evolved and I've evolved my thinking, we've evolved in our thinking. I think the hardest part for me was starting like this, being my first job. So I also never got the chance to, at a lower risk, lower consequence environment, learn the things of hiring and firing. Like I'm learning it all at the same time for the first time. And so we started out doing a lot of a mix of, oh, I know this person, I think they're great. Let's just bring them in. Doing the extreme. Yeah. Then the extreme end of open application. We'll just see what we get. There's a lot of issues with both, actually. Right. There's the noise of just who's applying, how are you really vetting them. There's the unfortunate truth where you can have this bias of you think this person is great. You guys both agree this makes sense, but actually this is not a good fit and the consequences that come with that. What we did for our most recent hire, development manager hire, which I'm so happy and thankful for, and shout out to Greenline Talent Group was we had a firm come in, a very boutique, right. Two people where they ran our process for us, a combination of open applications and sourced candidates. And this was the most stress free process that we've had so far. And the person that we welcomed has been great from day one. We're really excited to have her. So I don't think I'm going back. I think we made a lot of mistakes trying to do things ourselves, but like in all the parts of the business, like you gotta bring in people that know what they're doing.

[Rhea Wong]

Yeah, yeah. And I think for me the, the thing that was challenging was moving from that like very organic, like, yeah, like you're in the fam field to being really intentional about recruiting people who were experts in their field. And for me too, there was always a little bit of that feeling of, oh, am I qualified to do this if I'm working With someone who has 30 plus years of experience on me, who's older than me because I was also a young Ed.

[Jaron Petty]

Yeah.

[Rhea Wong]

So I'm wondering, is that something that you've been struggling with?

[Jaron Petty]

That's a really good point. I think it might have been a little bit unconscious at first. I think I'm now over that. And actually within the past couple years was very intentional. Hey, I gotta hire people that literally have been doing this right for time. We gotta mature as an organization. But there was definitely. I'll say it differently. Here's what I've struggled with. The things that I've struggled with that are a little bit related is one, as a young person starting a company and supporting a bunch of young people and helping them reach their potential, I just was super bullish on, like, young, inexperienced people. And so I was like, how could I? I was just like, no, we could do anything.

[Rhea Wong]

Yeah, no, same. I was like, youth development. It's all about, like, bringing in the youth and letting them figure it out. I'm like, that was a terrible strategy.

[Jaron Petty]

Exactly, exactly. And we had great people join us over the years. There's nothing. I think I quickly realized that, no, there's merit to years of experience and people having certain skills. There was that piece, another piece that I told Greenline when they ran our process was my biggest. The biggest challenge that I have or the biggest weakness I have when it comes to selecting people to go through a process is that because I have this. This eye for potential, like, I'm trying to help people reach their potential. I see it in literally everybody. Any resume I see, I'm like, you could be this one.

[Rhea Wong]

I could unlock this for you.

[Jaron Petty]

And so that, you know, I told them that from day one. And I was like, make sure this bias does not creep its way into our process. And so that's the thing that I've struggled with a lot where I can, like, latch on to these, like, one specific traits. And for good or bad reasons, like one reason to count somebody out or another reason to say this person is going to be perfect without considering the kind as a whole and considering what we need and all that good stuff, the more that I'm out of the process, the probably the better the outcome.

[Rhea Wong]

Yeah. You know, it's so funny that it occurs to me because I used to have one of my very best girlfriends. I don't think you listen to my pot. So I can feel like. But she would, like, date these guys and I'd be like, God, they're such losers. She's so awesome. Why is she dating. And she was always dating their potential. Right. She always thought, oh, he's just like a fixer upper. And I was like, no, no, girl, you gotta find someone who's moving ready. Like you're not trying to be here teaching him house manners.

[Jaron Petty]

Yeah, I love that analogy. House ready?

[Rhea Wong]

Yeah, you've been ready. I'm not trying to be a fix wrapper. 100.

[Jaron Petty]

Yeah. No, that's so real.

[Rhea Wong]

That's so funny. Okay. I want to talk to you about your community building because that is incredible. The fact that you have built this incredible community of 10% of all the computer science students of black and Latin origin around the country. How did you do it? That is just. That's an incredible feat.

[Jaron Petty]

Yeah, no, thank you. I. There's a couple different kind of tailwinds that helped us. One is the market needed it. Like they needed it. Let's not even. We can. There's a bunch of things that I did and the team did, but like they needed this.

[Rhea Wong]

Yeah.

[Jaron Petty]

It was clearly a gap. Right. A lot of the programs that have been built for this space are very kind of cohort based, small cohorts. Right. 100 people, 200 people maybe at most. There was nothing that could serve any, the average, any black or brown CS student. So they needed something.

[Rhea Wong]

The total addressable market, as they say in tech.

[Jaron Petty]

Exactly. We're here, we're here.

[Rhea Wong]

I'm just ready. Get me in, coach. I'm ready for the tech world.

[Jaron Petty]

Oh, man, that's great. So, yeah, there's definitely, there was definitely a need. The second thing is more personal to me is that as you've seen, I'm pretty active on LinkedIn. I'm a very out there person. I'm not, I don't, I'm not afraid to be out there. And so in college, as I was doing that work, I was. I started posting on LinkedIn in like sophomore, junior of college. So I started building up a following and in any space that I was in, naturally become some sort of leader. And. And so I already had this following of students of color from other schools. So once I was junior, senior year, whether it was LinkedIn or just like from Cornell itself or past internships, we launched with 500 students day one because of just people that just knew me.

[Rhea Wong]

Mm.

[Jaron Petty]

And so having that there's this component of bringing up, bringing up the startup, startup term, there's product market fit, but there's also this concept called founder market fit. And I think that's another thing that people don't think about enough whether you're starting a for profit or nonprofit organization is are you positioned to start this company? Like, why is that true?

[Rhea Wong]

Oh, that's a good one. Yeah.

[Jaron Petty]

And my, my take on this space, and it applies to any space, is that because I was a computer science grad and I had this following that is a perfect storm for me to start this. Whereas if you're someone who has no tech background and you didn't study CS and you have no network, you want to start an org supporting black around CS students. That doesn't make sense. So it was very easy for me to launch because of that background and that founder market fit. So then from there there was a tailwind of COVID where everything was virtual. So you're looking for virtual communities. We had this. It's very easy to share, LinkedIn, etc. I think it would have been harder to grow this fast if it was all in person.

[Rhea Wong]

Interesting.

[Jaron Petty]

If the pandemic didn't happen, I think it would have been harder to. We would have, we could have grown to this point at some point fast. But I don't think 15,000 in five years would have been doable.

[Rhea Wong]

Yeah. So it's all been like organic word of mouth. You haven't done like paid ads. Yeah, never.

[Jaron Petty]

Never paid a doll for ads. We've mainly seen students just tell their friends. And now we have the chapter network, where if you have a chapter on a campus, you're obviously incentivized to grow your own ch. And then in turn that grows the national org.

[Rhea Wong]

Very cool. Very cool. Let me ask you a question which I did not prep you for. So if you don't have an answer, I'm curious. With all of the pushback against DEI that's happening now, particularly at the corporate level, which obviously affects you, how is that affecting you if it is?

[Jaron Petty]

Yeah. Great question. Earlier, when you asked me about my. Our budget three weeks ago, four weeks ago, I would have told you that It'll be like 3 million or maybe more or whatever. I'm like, ah, no, we're gonna stay at the same amount. We've had to face the reality of what's happening, what we've seen so far. There, there are. I won't name companies yet because they might just. It might be a public thing anyway. But there's some companies that once, once they do their scru, they're scrubbing the sites. Once they go. Once you get to that legal or whatever stage of the vendor of the approval process, it's just, if you have any races listed or any of that stuff, you're just not. It's not going to happen. So we have some deals right now that are either confirmed not happening or are being held up, but there's really no path to being said happening because of our mission. Right. And then there's some companies that have, are still doubling down. Contract signed money's in the bank. Like, they're still going full speed ahead, but I'd say the majority is in the middle. There's, I would say 60 to 80% are in this holding period where they're waiting for leadership, especially on our earned revenue, especially on the corporate side. They are waiting for leadership's direction. What I heard from another org or somebody, a couple actually might have been yesterday, was the fact that it really does come down to the org's position in their customer base though. Like that company's position. Right. So you think about Apple where they were like, no, we're still doing dei, like we're not going to approve that shareholder thing, shareholder vote or whatever that was. And then you have an organization like a Google or Amazon, let's say, where you know, a lot of their business is literally data centers for federal government. And so once somebody explained that to me, I'm like, okay, it makes sense why Apple can be like, they're a consumer product, right? So like, oh, it's very easy for them. Whereas if you're one of your biggest customers is the government, that's just, it's just not easy. As much as you want to be make decisions on principle, it's just not easy. And it's not that I like it or that I want that to be happening, but I understand the more complex decision making that goes into that. Yeah, we'll see. But at the end of the day, to your point and what we've been advised, if we continue to grow our individual giving and our philanthropic giving though, that is a space that they have that freedom to continue to invest in things that they want as much as the administration wants to attack that.

[Rhea Wong]

Great. Okay, two last questions for me. This question I didn't prep you with, so.

[Jaron Petty]

Oh, good, I'm ready.

[Rhea Wong]

I'm curious. As someone who sits at the intersection of nonprofit and tech, I'm curious how you think AI is going to change the sector.

[Jaron Petty]

Great question. I have been training my team as much as I can to use AI and all of what they do. I caveat that by telling them, just don't embarrass yourself like you don't want to want anyone Looking at your work and being like, oh, this is definitely AI. Like, use it as the tool that is that it is. And I think this is a great moment for nonprofits because then, because now we're more efficient. Like, we're already strapped in many ways, so now we're able to save our employees some time and do things in a more lean way. So I think that's a really good. It's a really good moment for the nonprofit sector. I think for workforce development nonprofits, though, we are in the middle of this unknown of what's going to happen to the economy and the kind of job market as a result. The only thing we can do, I don't know, I can't say what's going to happen in five years. I can't say what's going to happen in two years. But at least right now, companies are still hiring and they are more likely to hire someone who is AI native than not. And so today, that is all that I think we can do. Make sure the students and the candidates and the people that workforce dev organizations are serving, make sure they're AI native, make sure they're fluent, make sure that makes them a 10x type of employee versus not. That is what we can do today. If we find out in two years that there's like a whole, like no more engineers or whatever the case, we'll adapt to that. But I think the, I think it's better when we just, we see the trends. Yes. But also just like, what's in front of us. Like, I was telling this fund, this potential funder, one day, he was asked, he was asking, like, oh, what's happening to the need for software engineers? This is a funder who's not in tech too. And they were like reading the doom. The doomsday.

[Rhea Wong]

Yeah. Like, I read an article and therefore, I think everyone is not going to be out of a job. I read that ChatGPT can code code and therefore.

[Jaron Petty]

Okay, like, it's a little bit more complex than that. So what I was telling them, though, was that, yes, there's a lot of advancements in AI and coding agents and all that stuff. And my. Our partner companies, I can point to many of them that are increasing the size of their internship programs. So that's the dynamic I'm trying to explain. I need to respond to what's in front of me, AKA there's jobs and there's more of them, more internships than there were last year from these partner companies. So I need to get students into those and keep a pulse on, like, where things could be going tomorrow. So it's both. And like, I don't think there's this like, immediate just all the jobs are going to be gone thing. So we have to continue to do the work that we do, make sure, make the adjustments that are necessary, while also keeping a pulse of, like, where things are headed.

[Rhea Wong]

I heard something that I thought was really poignant, which is, AI is not going to take your job. Someone who knows how to use AI is going to take your job. And I was like, that resonates. Which leads me to think I'm actually going to be doing a training about how to incorporate AI into your nonprofit. So, yes, stay tuned for all that.

[Jaron Petty]

Yeah, of course.

[Rhea Wong]

Because I have this. I have a tech stack that I like to use and I feel like a lot of nonprofits are very reluctant or scared to use it. And I'm like, it's guys, to your point. It just increases your capacity. Use it responsibly. Don't let it run your entire newsletter. But there are ways that it can amplify human effort.

[Jaron Petty]

Yeah, 100%.

[Rhea Wong]

All right, last question for me. And it's a little self serving, but you and I got a chance to work together early on in your fundraising career. Maybe it was a little too early because I think you were still figuring stuff out, but I'm just curious.

[Jaron Petty]

Yeah.

[Rhea Wong]

What was it like to work with me? What kind of impact did you see as a result of being working with me?

[Jaron Petty]

Yeah, totally. I think the biggest piece or the biggest thing that stuck with me since then, because I don't know, it was like two, three years ago maybe was this phrase. And I don't know if it was your phrase or just something that's well known in the nonprofit sector, but it was like this idea that you have, like, you don't get money if you don't ask, basically. And that simple phrase, because I would go into these calls, I'd go into these things, I'm just like, oh, I'm going to explain all that I do. And the people are just going to jump and say, okay, how much do you want? Or like, they're gonna be like, okay, here's a million. That's not how it works.

[Rhea Wong]

You know what's so funny? Sorry to interrupt, but I was literally on a call just before this one where I was like, fundraising is a little bit like dating, right? If you're single and ready to mingle, you gotta tell people you can't be in the corner. Like, I'm single. But maybe you should ask me for a date.

[Jaron Petty]

That is a great reference. That is a great analogy. That one thing helped me not it didn't change my behavior immediately, but it was a good kind of question that I asked myself after something didn't go through or a meeting didn't go how I wanted to. It's. But what did you ask for? Did you even make an ask? And I'm like, oh, that's right. I just cut away. And over time now it's more at the forefront. But that just behavioral change, that mindset change, I think helped me a lot in fundraising and even outside of fundraising, even with employees and feedback and things like that. Did you give them feedback? Are you just waiting for this to be magically changed? Like, I think that was just like a good principle across the board. And I really, I don't know if you still do the these things in the same way, but just the cohort model and like the small groups, the breakouts for accountability and things like that was great. So yeah, I really appreciated that time.

[Rhea Wong]

Great. And would you say that as a result of being in the program, you could point to an increase in funding or anything really concrete?

[Jaron Petty]

Yeah, of course. I mean that. So that following year. Oh, concrete. I'm trying to think of actual deal. I think for the most part for me it was that mindset shift. Right. Because even at the time, like you said, like I weren't doing as much philanthropic fundraising, but it impacted how we did our corporate earned revenue fundraising at the time. And then the following year, once we actually started getting our first philanthropic gifts, like that same idea of you're not just going to the, the Gates foundation, not going to call you one day and say we want to give you money. Like you actually have to go and ask. That kicked off that strategy for us where we started to make asks, right. We got 1.2 million from reboot. We got 50k from okta. Like we started to get things because we asked for them. Right.

[Rhea Wong]

So was there like a. What was the budget before we started working together and what was the budget after? I'm not going to say that what's 100% my doing, but I think, yeah, people that. Yeah, I think in the Wayback Machine.

[Jaron Petty]

In the Wayback machine. I think that the year we worked together, we were at 500. I know it was before our first audit. I remember it was before our first official audit that we had to do. So it was. Had to be under 750k. And then after that was over like 1.2 because I remember that we triggered the need to do it. The New York State. Yeah, the threshold. Exactly.

[Rhea Wong]

We call those champagne problems.

[Jaron Petty]

Yeah, exactly.

[Rhea Wong]

All right. Awesome. Drawn. This is so great. How did you get to be so smart?

[Jaron Petty]

Listen, I try my best. Try my best. Stay curious.

[Rhea Wong]

You know what I really appreciate about this conversation too is it gave me insight in the way that your brain works. And it's very clearly computer science brain. You're like, if this, then this, right? You're like, I'm going to put this piece in this piece and then this piece and if that piece doesn't work, I'm going to swap it out into this piece. And it's like the systematic way that you're thinking has served you very well. So kudos to you.

[Jaron Petty]

Thank you so much, Raya.

[Rhea Wong]

And if folks want to get in touch with you, if they want to learn more about you, about Color stack, I'll make sure to put all of your info in the show notes. Also, you're all over LinkedIn. You're not hard to find.

[Jaron Petty]

Yeah, yeah, connect me on LinkedIn. I talk about nonsense every week.

[Rhea Wong]

Okay, sounds good. Thank you so much, Bren. Good to talk to you.

[Jaron Petty]

Thank you.

[Rhea Wong]

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