Meet the leader who's helped hundreds of Minnesota nonprofits with financial advice

Kate Barr, one of Minnesota's foremost experts on nonprofits and philanthropy, is retiring in January as CEO of Propel Nonprofits after a 23-year career leading the Minneapolis organization.

In that time, Propel has become a critical resource for hundreds of nonprofits each year, providing training, financial consulting and loans ranging from $20,000 to $1 million. Barr, a longtime St. Paul resident, has also mentored hundreds of nonprofit leaders in Minnesota, which she calls a "nonprofit nirvana" owing to the above average generosity of the state's individuals and foundations.

She "accidentally" fell into nonprofit work, she says, when she landed a job at a dance company. She went on to a 20-year career in commercial banking before combining her interests in nonprofits and finance in 2000 to run the Nonprofits Assistance Fund, overseeing a $3 million capital loan fund.

The organization was renamed Propel after it merged in 2017 with MAP for Nonprofits. Today it has 35 employees and a capital loan fund of $45 million, providing financial services, consulting and training, and administering grants.

"It's like we're three things in one," Barr said, adding that there are no community development financial institutions like Propel in other states.

Propel recently announced that Henry Jiménez, CEO of the Latino Economic Development Center in St. Paul, will succeed Barr in February. But Barr plans to stay connected to the nonprofit sector in retirement by teaching at the University of Minnesota, serving on boards and mentoring leaders. She's also looking forward to spending more time with her two adult children and grandchild.

Barr sat down with the Star Tribune to reflect on her career and an ever-changing landscape for the more than 15,000 nonprofits in the state. This interview has been edited for clarity and length.

A: When I had my interview for this job they asked me, "What gives you the greatest satisfaction?" And I remember saying I love driving down the street and seeing businesses that I helped. But I didn't love banking. I've always loved nonprofits. I've always been interested in things that make a difference in the community.

Q: What do you think your legacy will be in the sector?

A: I think we have been able to really help change the conversation around nonprofit finance. Being broke all the time is not a virtue. We've helped change the conversation, in particular around capital coming to nonprofits. But I think that probably the greatest legacy is [mentoring and training] nonprofit leaders.

Q: You've said you've been thinking of retiring for several years. Why is now the right time, and what's next for Propel?

A: You have to be personally ready. And you have to make sure the organization is ready. It was the middle of a pandemic when I started thinking about it, so not a good time. We serve the whole state and I know one of the hopes of the new leader is they be even more involved in relationships around the state, and just continue to deepen the work.

A: Everyone should adjust their expectations to prepare for something different. Leadership looks different now. Be ready for change and be adaptable.

Q: The last three years have challenged nonprofits in new ways — from the financial pressures of the pandemic to staffing shortages, and the increased scrutiny due to the Feeding Our Future scandal. What do you think is the future for Minnesota's nonprofit sector?

A: During the pandemic and then after George Floyd's murder and the response to it, who was at the front of the line helping people? Nonprofits. Nonprofit organizations, many of them quite small, became very visible in their communities. And the community started to see how much they needed those nonprofits.

And because of that, it has both increased the demand for what nonprofits do [and] it has also increased the expectations. [But because pandemic government aid is ending and] costs have gone up, it's just more expensive to do the work. Many nonprofits are finding they have to find new sources [of revenue].

Nonprofits have become more representative of the people they serve. And I think that is probably the most powerful change in the sector: The people who are making decisions at nonprofits actually have the experience of the people they serve.

A: There is still a lot of distrust of nonprofits — that they know how to spend their money, that they know how to run their business, that their overhead is too high — when that is not a question that we ever ask of Target. There is still a misperception that, if you're a nonprofit, the money just automatically comes, and that people at nonprofits somehow shouldn't be paid what the market is.

Q: What are you looking forward to in retirement?