The following is a conversation between Lynn Margherio, the Founder and CEO of Cradles to Crayons, and Denver Frederick, the Host of The Business of Giving.
Denver: More than 20 million children in the United States do not have the clothing and basic essentials they need for healthy childhood development. Families are struggling more than ever to pay for rent and groceries and often can’t afford the basic items for their children– properly-fitting outfits for school, diapers, a backpack, shoes, pajamas, a coat for the cold weather.
Cradles to Crayons helps to fulfill these critical but overlooked needs. And here to discuss how they do it is Lynn Margherio, the Founder and CEO of Cradles to Crayons. Welcome to The Business of Giving, Lynn.
Lynn Margherio, the Founder and CEO of Cradles to Crayons
Lynn: I’m thrilled to be here. Thanks for having me, Denver.
Denver: Regular listeners of this program know how much I just love founding stories. Tell me yours and how the idea of Cradles to Crayons first came to you.
Lynn: So, Denver, it was about 20 years ago, and I didn’t have any children of my own at the time, but I was home visiting my family in Michigan and helping my niece to get dressed, and I noticed that there were clothes that had never been worn with tags still on them that were too small for her.
And then I visited my brother and noticed that he, too, in the playroom, there were toys and books and puzzles that the kids had not been using. And I thought to myself: my background is business consulting; here is a supply opportunity. There are all of these items… I see it in my own family’s homes, and I know that homes across the United States are in a similar situation because kids grow so fast.
They’re outgrowing clothing in the space of three or six months. They’re outgrowing books and other items, but often these items are in beautiful condition, and they’re waiting for another home. And so, with my background as a business consultant, I began to talk to a lot of organizations that work with families that struggle financially to see, “Are they being approached by their clients for support with clothing and other supplies? How are they addressing it?”
What I heard over and over again was that this is a need that they are faced with every single day, but they don’t have the space to house the donated supplies, and they don’t have the people power to process them because you can’t give a bag of random children’s things to a five-year-old boy and meet his needs.
You need to give that five-year-old boy clothes that fit him.
Denver: Yeah.
Lynn: Maybe size six tops and bottoms, books that are at his reading level. And so, it was really both the observance of this potential, ever-recharging supply opportunity, matched with what I quickly learned was a very large need.
“And then one day, I went into the warehouse that we were using at the time. I didn’t know a soul in the warehouse. And I looked around; I thought, ‘Wow, these are people who have found this brand-new organization through word of mouth, and they have arrived here to help sort donations because they care.’”
Denver: The power of observation and connecting the dots. A lot of people, Lynn, have these kinds of revelations. What do you think was the difference… in terms of taking that and observing that, seeing that there’s a need and a supply and actually activating it –and making what has happened over the course of the last 20 years. It’s usually those initial steps that I think really… where people get stuck. How did you break through?
Lynn: That’s a great question, Denver. And when I first got this idea, I thought to myself, “Oh, certainly somebody is doing this.” And so, I put it in the recesses of my brain, but then I would visit friends’ homes, and I would see the same situation that I saw in my sister’s house, where there were things that their children had outgrown.
And I couldn’t let go of it because it kept popping up, and my interest had been piqued. And so, I said, “All right, I’m going to pilot this. I’m going to do this in a small way. And I’m going to see if there’s any traction here.”
And I started cold-calling schools. Like I said, I didn’t have children of my own, so these were complete strangers I was dialing up and asking for someone in the principal’s office, “Hey, would you do a supply drive for Cradles to Crayons?” And I didn’t get people hanging up on me.
Instead, what they were asking was, “Well, where would these donations go? Because we’ve actually been approached by parents with an interest in donating their children’s clothes or other items, but they want to know that they’re reaching kids who really need the items, and they want to know that these items will be provided at no charge.”
And so, I got a lot of energy from that because you need to get that reinforcement to know that you’re on the right track. And so, I would just keep getting those small wins that one day added up to… And, of course, I would ask all of my friends and colleagues, “Would you pitch in on this? Would you help me unload this carload or truckload of donations?”
And people were very supportive. But I really started to feel like I might be at the end of my asks, because I keep going back to the same group of people. And then one day, I went into the warehouse that we were using at the time. I didn’t know a soul in the warehouse.
And I looked around; I thought, “Wow, these are people who have found this brand-new organization through word of mouth, and they have arrived here to help sort donations because they care.”
And that to me was the pivotal moment where I thought there’s some power here when you can connect what you see in supply with, I think, just this basic human need to give back and the power of empathy. You can connect those two things together and you can do magical things.
Denver: Yeah, that’s a great story, and thanks so much for sharing it. And it all started with a little bit of intrepidness. You got on the phone and then you connected the dots and wrote the plan as you went along. You talked about the human need and connection. Let me ask you this, Lynn, what does poverty look like and feel like for kids?
Lynn: It doesn’t feel good. I’ll start there. Poverty creates toxic stress for children, and we know from brain development research that toxic stress has a very detrimental effect on children’s self-esteem, their ability to learn. And so, removing those things that cause that stress… really important.
And so, it certainly was new to me when I started this work because it wasn’t my experience living in poverty. And so, I had to learn. But I’ll just walk through a little, maybe quick math to describe what we’re actually talking about here because poverty, or just financial struggle, is much more pervasive than we might think that it is.
In fact, 40% of Americans right now are struggling to meet their weekly expenses. And so, let’s take a typical family, a family of four in the Philadelphia area. And so, if you had two parents working, getting the median hourly wage, they’d make about $44,000 a year, and I’m going to use round numbers to make it simple.
That gives them about $3,650 a month for all their expenses. So then, you look at what are the things you have to pay for first. We have to pay for a place to live. So, you’re taking $1,260 off the top just for rent. And then groceries, about $900.
And then you have to get around, so you’ve got to pay for transportation. That’s another $1,100. And then if the children are too young to be in school, then the childcare is about $1,680. I don’t know if you’ve been tracking the math, but we’re $1,300 overdrawn. I haven’t even started to talk about the basics that we provide.
If they don’t show up, there’s nothing left in that family’s budget for clothes, for school supplies, for diapers, for other incredibly basic needs because simply, the math doesn’t work. And that’s the reality for two out of five households across the United States.
Denver: Yeah, and the math just keeps on getting worse and worse, particularly as it relates to the rents and the groceries. And I would imagine that a lot of the kids that you work with probably miss school because they’re embarrassed or don’t want to be teased.
Lynn: Denver, you hit the nail on the head there. What we know is that not having appropriate clothing, and we call that clothing insecurity, is one of the top 10 reasons a child misses school or misses appointments. And we know if a child is not going to school… Think about a cold winter day in New England; you need a winter coat. You don’t have a winter coat. And so, mom or dad or a caregiver keeps you home because you can’t wait for that school bus.
And so, the consequences of not having something as basic as clothing cannot be overstated. And, I’ve got a couple of stories here, just right now because it’s back to school shopping. And so, what we’re finding is parents… like there’s a family with two school-age girls… Manny is looking at all of the expenses for buying the backpack, school supplies and the clothing, and realizes he’s got to take a second job just to make ends meet.
And so, you’re absolutely right. Not having these basic supplies impact that toxic stress that I spoke about earlier, and it bleeds over into performance and attendance in school, health outcomes, and safety.
Denver: Yeah. And even if you could weather the cold, you’re going to get teased if you go to school without a coat or wearing sandals, so you got it at so many different levels. You have a three-step model that brings this mission that you’ve been discussing to life. How does it work, Lynn?
Lynn: So, what we first do is we make it easy to donate. And so, we ask people to donate through dropping off items at our Giving Factory locations, conducting drives at schools, faith-based organizations or corporations.
We also have a new online model, where you can donate from the convenience and comfort of your home, and we will match you to a child who needs the specific items that you have. We also provide meaningful volunteer experiences. So, in addition to donating outgrown children’s clothing and other supplies, you can come in and volunteer with us.
And we have two hour shifts where it’s really fun. There’s music. We see a lot of teamwork. In fact, since COVID, a lot of people and corporate teams have not seen each other face to face. And so, we’re finding people meeting each other face to face for the first time in two-and-a-half years doing service and seeing the kind of impact that they make.
And then the third piece of it is collaboration. We partner with more than 500 schools and service agencies who identify the families in greatest need. They order the packages on their behalf and distribute the items directly to them so that we know that the donated goods are getting to the families in greatest need.
“And we’ve found that those young people who get a passion for giving back, they are some of our best spokespeople, and they build a confidence around giving back, and it’s infectious.”
Denver: Let’s go back to volunteering for a moment. You’re on a mission to encourage young people to volunteer. Why are you so passionate about that, Lynn?
Lynn: So, I believe that philanthropy starts at a very young age. We know as parents, we hear in schools that you start to learn about sharing. And so, sharing is not just what you do with your siblings, your friends, your cousins, or your neighbors.
It’s also how you think about other people in your community, people you may never meet, and really trying to open the aperture for kids and their parents at the same time and begin to instill practices of engagement and giving back from a really young age.
And in our case, we have volunteers as young as age five coming in, and they’re actually doing things that they can relate to. So, they are helping to match shoes. So, we’ve got matched a pair of shoes to give or they are helping, and when families are doing shopping in our finished goods aisles and making packages for other kids, they’re helping by pulling things down from the shelves.
And the parents are having conversations with the kids about who are the kids and what do you think they would like, what do you like, and the conversations that we overhear are pretty amazing. And now over 20 years, I’ve seen kids grow up with Cradles to Crayons. They started when they were really young, and their parents might have brought them.
Then they come with a school group, or they start inviting their friends or teammates to come in and volunteer with them because they have had such a good time. And then they move on to our team leadership program and then through our college core.
And we’ve found that those young people who get a passion for giving back, they are some of our best spokespeople, and they build a confidence around giving back, and it’s infectious.
Denver: Yeah, that’s great. Well, that’s long- term stewardship. And even if they were to do something else beyond Cradles, you’re building good citizens along the way, and that’s great. And taking all that you have to do here, it’s pretty overwhelming. So, what you do is you try to disaggregate it a little bit at least by conducting seasonal campaigns. What would some of those be?
Lynn: So, Denver, as you think about clothing insecurity as not having adequate access to appropriate seasonal clothing, what we know is that as weather changes or as kids are growing, they need to have new outfits multiple times a year.
And at the same time, we know that parents are cleaning out their kids’ closets around the same frequency. So, for us, we try to match those two activities. And so, right now, we are in our back-to-school campaign, which is around seeking donations for seasonally appropriate clothes so that kids can move and feel confident when they’re going back to school.
We are also buying and packing school backpacks filled with brand new school supplies. And then we’ll move into a winter campaign around gearing up for winter. We then move into spring greening, and then we’ve got to gear up for baby campaign, which is again a year-round campaign, really raising awareness about diaper need.
Denver: Yep. That would be year-round babies, no season for that. A big challenge, I think, every non-profit organization has is trying to measure impact. How do you go about trying to measure yours?
Lynn: So, currently we are measuring our impact in terms of packages distributed, our volunteers we’ve empowered, and the relationships that we have built over time. So, we have distributed three and a half million packages of essential items to date; we’ve engaged more than 580,000 volunteers, and we partner with 500 service partners across the community.
And we are now moving into more work on building public awareness for ending clothing insecurity, and we’ve got a new platform, Giving Factory Direct. And so, we’re looking at other measures of impact and momentum. And so, those are things that we are currently building indicators to track.
Denver: We talked a lot about your in-kind contributions that come. Tell us a little bit about your financial contributions, those being fundraising, and what your fundraising model is. And also, Lynn, how do you think philanthropy could be more effective in helping organizations like yours deliver against mission?
Lynn: That’s a great question, Denver. So, we are 100% privately funded currently. And so, our support comes from, it’s about an even split between individual and family support and corporate support. And then we have a smaller percentage of our funding that comes from foundation or event support. So, Denver, our philanthropic model currently and historically has been private philanthropy. Roughly, 40% of our support comes from individuals and families, 40% from corporate support, and the balance from foundation and other sources of support.
As we look at building awareness nationally around this hidden crisis of clothing insecurity, we realize that as a single organization that has been focused on direct service, we need to get government more involved in looking at clothing insecurity as part of that social safety net that has been ignored to date.
And we also want to get other individuals, families, schools really rallying behind ending clothing insecurity. So, what that will look like going forward is: our goal will be to try to encourage more direct support to families for basic needs and allowances around clothing. We’ll look for additional support for meeting diaper needs, and that is a thrust that we have going forward.
Denver: That’s cool. This is not an easy time to be in charge, Lynn, as you know only too well. How do you think the nature of leading a major social enterprise is changing, and how has your approach to leadership changed over the course of the last couple years?
Lynn: There’s a lot to that question, Denver. And as I think back on the impact that COVID had on our organization, to me, that was a turning point for us because it threw our business model such a huge curve ball. We were all about in-person engagement and bringing lots of individuals and teams and corporate groups into our Giving Factory warehouses for an-in person experience.
All of that stopped in March of 2020. It has come back but we had several months where we were not able to rely on the historical way that we have done our work. And so, really bringing our leadership team together and talking through: How do we handle this? What is our response going to be?
We know that the need for the clothing and other supplies that Cradles to Crayons provides has only increased during this time. And so, we are an even more vital resource to the community. And so, what we did was we opened it up and had our leadership team as well as team members in each of our locations really think about: What’s the model here? How are we going to serve the community? And how are we going to keep our colleagues and team members safe?
And so, it was, I think, a much broader group of people who were weighing in to what is the future of the organization and also an openness to collaboration because you had to. You didn’t have the playbook that had worked really well for us leading up to that point.
And so, reaching across geographies to brainstorm, “Here’s what we’ve tried. What have you tried?” So, we’ve seen collaboration; we’ve encouraged it with technology, and making space for these cross-market teams to come together.
And then also, we’ve really leaned heavily into innovation by saying, “All right, How can we connect individuals that have an interest and passion for supporting children? How can we give them the tools to make it easy to do where we’re not in the center of it? And so, that led to the creation of our Giving Factory Direct model.
And so, in a nutshell, it’s increasing or decentralizing some of that decision-making; encouraging and promoting collaboration through technology; and making space in people’s schedules and providing some structure for that. And, again, encouraging innovation.
Denver: Yeah. And that’s such an interesting thing you say about innovation because, I think, historically, when we thought about innovation, we think of blue sky: Do just what comes to your head; go out there and just do anything. And you find out in reality, it’s that innovation comes as a result of constraints.
And if you had not had these constraints placed on you, you probably would not have had the level of innovation that you had. But in doing so, you just came up with all these new things, and I think one of the things that had really caught my eye– I may ask you to speak a little bit about this more– is I was going to ask you about new best practices, but it almost sounds like you gave me the answer there– that one of your new best practices is shared decision-making. Would that be a fair statement?
Lynn: Yes, it would be, and I would say that we’ve got various committees that are cross-market committees. So, I’ll take the example of our employee safety and health during COVID. We brought together the people who were most impacted and most aware of what the concerns of team members would be, what our constraints and opportunities inside our Giving Factory warehouses were.
And we brought experts from our partners. Corporate partners helped by lending or making introductions to people in their networks. And we brought those people together with our operations leaders and managers to come up with: what are our safety policies and protocols? Because they’re the best positioned to tell us that.
So, that’s just one example of how we are working to put in place structure and tools and mechanisms for encouraging that shared decision-making.
Denver: So, as we sit here in the summer of 2022, what would you say is your biggest challenge right now? And how are you trying to approach that challenge?
Lynn: You started the podcast at the outset by framing it well, which is that two out of five children face clothing insecurity, 20 million of them, and nobody knows about that. And so, our biggest challenge is building awareness about clothing insecurity. And so, we have started to work on getting out there in coalitions, trying to put in place the pieces for a campaign and a movement to end clothing insecurity, but it’s a big challenge.
It’s a nationwide challenge. And we are really trying to get policy makers, get media, get individuals and corporations to understand that like food insecurity, like housing insecurity, those very same families that are facing those insecurities are facing clothing insecurity for their kids. And so, that’s what our biggest challenge is. It’s also what we see as our biggest opportunity.
Denver: Yeah. And it’s interesting because when you think how it bleeds over into everything else, we think about academic achievement… so we wanted to do something about academic achievement and put resources to that, but a big part of that can be clothing insecurity.
It’s hard to achieve academically when you don’t want to go to school or mental health– when people are beginning to look at you wearing sandals in the freezing weather. So, it’s not in and of itself, it’s just how it touches everything for a young person, and you’ve really gotten that across well. With all that, Lynn, what’s next for Cradles to Crayons?
Lynn: So, Denver, we have real focus on our online platform, Giving Factory Direct. It’s essentially innovated the donation process by allowing people to sort, package and begin the distribution process remotely
By utilizing this digital platform, we’ve been able to spread into nearly 40 states within the past 15 months. What we have learned is that direct service is a critical and tactical way to meet need, but it has limitations.
To truly make sustainable change at a scale that more closely reflects the demands, we need to first make a lot of noise, gain momentum, and generate interest in finding more solutions to clothing insecurity, and then leading the clothing insecurity movement is a way that Cradles to Crayons has been scaling through advocacy work, to spread awareness, support legislation, and start conversations at the national level.
Denver: That is a full plate! For listeners who want to learn more about Cradles to Crayons, financially support the organization, make a donation of in-kind clothing or some other thing, tell us about your website and what they can expect to find on it.
Lynn: So, Denver, our website is cradlestocrayons.org. If you live in one of our Giving Factory locations…
Denver: What are the cities?
Lynn: So, we have locations in Boston, in Philadelphia, and in Chicago. You can find out what are our most needed items and do a drive, or drop off donations at a convenient location near you. You can come in to volunteer as an individual, with your family, with a group that you are part of; you can make a financial donation.
And if you don’t happen to live in one of our markets, you can make a donation and serve a child through Giving Factory Direct. And last, we’ve just launched this public awareness site, endclothinginsecurity.org, which is also reachable through our Cradles to Crayons site, where you can learn more about the impact of poverty on child welfare, and you can learn about the issue of clothing insecurity.
Denver: Great stuff. Thanks, Lynn, for being here today. It was a real pleasure to have you on the program.
Lynn: Thank you, Denver.
Denver Frederick, Host of The Business of Giving serves as a Trusted Advisor and Executive Coach to Nonprofit Leaders. His Book, The Business of Giving: New Best Practices for Nonprofit and Philanthropic Leaders in an Ever-Changing World, will be released later this year.Listen to more The Business of Giving episodes here. Subscribe to our podcast channel on Spotify to get notified of new episodes. You can also follow us on Twitter, Instagram, and on Facebook.