JEAN CASE:  I was interested in National Geographic for a long time before I realized it was a nonprofit.  Is it a common perception that the organization is a business?
 
JOHN FAHEY:  Yes, a lot of people don't know that we're a nonprofit, but we have been for more than 100 years.  From the beginning, National Geographic was created as a nonprofit to inspire people to have a lifelong appreciation for the planet and its people.  Our mission hasn't changed.
 
JEAN:  And it seems that almost everything you're involved in supports that core mission.  Was that the plan from the beginning?
 
JOHN:  Actually, yes, and the person who really deserves credit for making the model that National Geographic uses as a nonprofit is Alexander Graham Bell, our second president.  He decided that creating a magazine designed to educate and appeal to people generally, instead of being a magazine for specialists, could accomplish two important things -- to expand exploration beyond what benefactors could fund and to reach more people with the information that was coming back from those explorations.  We've been building on that formula ever since.

JEAN: How have you used innovative approaches to remain sustainable?

JOHN: We're actually a membership organization, which has been the source of our strength for a long time. We have close to 9 million members around the world. We've been fortunate that our members and products have enabled us to do things that otherwise wouldn't have been possible. Because we're not scratching for dollars every day, I think we're more able to focus on our mission.

JEAN: How has the organization adopted modern-day technologies to support your mission?

JOHN: New technologies really invite so many new ways to reach larger, broader, and different audiences in addition to those we reach in print. We've had good success first introducing television programming 35 years ago, and then more recently with our cable channel and what we're doing on the web. Very importantly, we're interested in all the new digital technologies that are coming ahead and all the possibilities they will offer us.

JEAN: You've applied innovative business models to the work of National Geographic. We're seeing that a lot of nonprofits that are struggling are interested in those types of models. Can you talk about your for-profit efforts?

JOHN:  Historically, we have not relied on classic fundraising, though that is becoming a factor in our sustainability. What's been important to us is to generate as much funding as possible from the sale of our products, which are all designed to align with our mission.  We've done that with magazines, with books, and in schools.  As we started to move into television, we realized that even with our strong brand, we needed media partnerships to break into important distribution channels.  Given the nature of those partnerships and distribution channels, we decided it was prudent for us to do it using taxable subsidiaries to ensure our nonprofit status.  So where we think our activities could possibly be deemed to be taxable, we've chosen to make them taxable subsidiaries of the nonprofit organization.  That's allowed us to do more things than if we said we were going to be constrained to those activities that are purely nonprofit activities.   That being said, we firmly believe that all these activities serve and support our mission.
 
JEAN:  How important is collaboration for National Geographic?

JOHN:  We've had a number of successful partnerships, and we find we're in a situation that we can collaborate with organizations that don't have financial security and help make them more successful.  We're currently working with the Jason Foundation for Education, a great nonprofit with a budget in the $10 million range.  Its mission is to get young kids excited about science -- it's a wonderful idea and they've done great work, but they rely on traditional funding sources to succeed.  They went through a rough patch recently and were facing a serious cash deficit.  We looked closely at them and are set to acquire the organization.  Instantly, the headache of having to worry about cash flow can go away, and we can introduce our model to them.  They have an opportunity to sell products to schools to help teachers get kids excited about science.  Our hope is that they can create a steady stream of operating income that can help fund activities that advance their mission.

JEAN:  What most excites you at National Geographic these days?
 
JOHN:  Our Genographic project is about understanding human migration, but it's really about understanding how all people are connected.  It allows us to help people focus on the fact that there are more similarities among us than differences.  What's exciting from my perspective is that generally, we've been a grant-making organization that's provided seed money to individuals at other organizations to pursue projects.  Genographic is a different model for us, because we are running the project.  It's also a philanthropic success in that major funding came largely from a private foundation and a corporate sponsor. What we want to do is take on high-profile, important issues, do the scientific research, then use our media to reach as many people as possible.
 
JEAN:  John, you're a business success who made the decision to hop over to nonprofit.  Was that a hard decision?  And how can nonprofits attract other talented executives from the private sector?
 
JOHN:  What was intriguing about this opportunity was you get to a point that it's not a bad thing to exit the "what's-your-cash-flow-going-to-look-like-in-the-next-quarter" world and get into a situation where what matters most is bringing financial responsibility and acumen to mission-oriented causes and projects.
 
JEAN:  Looking back over your life, what were the key things that influenced you and prepared you for the things you're doing today?
 
JOHN:  I had the great fortune of growing up in a classic middle-class family that didn't have a lot.  It doesn't mean that if you grow up in a wealthy family you're not going to succeed.  But the way I grew up -- in a 900-square-foot apartment with five people -- gave me an appreciation for a lot of things that has stayed with me.  I find that I'm in this sort of exalted position and have access to all sorts of interesting things, but I'm able to appreciate the little things, including the things other people do, and that's helpful to me.