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.