Eclipse of the Nonprofit Corporation

The Market for Nonprofit Control and Why it Matters

Abstract

With revenues of more than $362 million, Devereux Foundation was the nation’s largest nonprofit provider of human services at the end of 2004 – far larger than the $97 million in revenues reported that year by Providence Service Corporation (NASDAQ: PRSC), an Arizona-based publicly-traded, for-profit company founded just seven years earlier. Ten years later, century-old Devereux’s revenues had grown to slightly over $400 million - a compound annual growth rate of just 1.0% - while Providence’s revenues had reached nearly $1.5 billion – a compound annual growth rate of more than 31%.