By reconnecting with its soul, a nonprofit organization amplified its impact and multiplied revenue by 5x

By Verne Harnish

When Buddy Teaster joined Soles4Souls as CEO, the nonprofit was facing a financial crisis, and morale was suffering. The Nashville, Tenn.-based organization, which turns 20 next year, helps entrepreneurs in low-income countries such as Haiti and Honduras start small businesses selling shoes and clothing. Retailers and manufacturers donate the inventory—merchandise they have not sold—to divert from landfills. 

Teaster, who was hired by the board to replace the founding CEO, used the Rockefeller Habits and Scaling Up platforms to turn around the organization’s finances and team morale, with guidance from Petra Coach in Nashville. A key part of this work was reconnecting with the organization’s soul—partnership with both the entrepreneurs it helps and the companies and other stakeholders that support it.

“It’s very much about economic opportunity,” he says. “We use markets and capitalism as a vehicle for that, but we have a very clear social mission in the end.”

Since he came on board, the organization has 5xed revenue from $4 million annually to $20 million, with $4.3 million in net income. 

As the organization has doubled down on its commitment to the populations it serves and the fiscal solvency to support that, it has become a top-rated, four-star charity in Charity Navigator and a sought-after employer. For four consecutive years, it has been recognized as one of The Nonprofit Times’ Best Nonprofits to Work For.

Teaster, a longtime member of the Entrepreneurs’ Organization and finalist for the YPO Global Impact Award, released a new book, From Tailspin to Tailwind: Leadership Lessons from Turning Crisis into Clarity, in May to share the story. In May, the serial entrepreneur launched the re: Purpose podcast, which focuses on purpose-driven leadership and social impact. 

Although the economic environment has been challenging for Soles4Souls, he says the organization has the resilience to weather this. “We have reserves,” he says. “We have money in the bank. We could only have done all of this—I’m unequivocal about this—through the Scaling Up process.”

Embracing Core Values

Teaster’s work as CEO began by reconnecting with the organization’s mission to use clothing and shoes to create opportunities for budding entrepreneurs in low-income countries to become self-sufficient. 

Its operational model has been to collect and provide donated shoes and clothing to these entrepreneurs. Soles4Souls currently works with footwear and apparel partners such as Adidas, allbirds, Crocs, Deckers, Eileen Fisher, Hoka, New Balance, Nike and Zappos. They donate new merchandise they can’t sell and run cause-related fundraising campaigns. Soles4Souls relies on international partners to distribute the shoes to entrepreneurs and thrift stores.

However, by Teaster’s account, the nonprofit had lost sight of the goal of helping business owners lift themselves out of poverty when he came on board. “They were just selling the shoes to whoever would buy them,” Teaser says. 

One key step in the turnaround making sure it was selling the merchandise to resellers in developing countries who were either lifting themselves out of poverty or were helping those needing economic opportunity. A key underpinning was embracing four Core Values as an organization: Transparency, Entrepreneurial, Accountable and Meaningful (TEAM). He committed to keeping the entire team informed about the organization’s finances, taking an entrepreneurial approach to working with the small business owners they served, delivering on their promises, and working toward goals that mattered to the populations they help. “Our Core Values emerged from the process of getting things turned around,” he says.

Putting cash front and center

Ensuring the organization had enough cash in the bank was critical to its turnaround. Soles4Souls had been without a CFO for some time when Teaster joined. He prioritized financial discipline, such as sticking to a budget. Within 18 months of joining the nonprofit, Teaster had reduced its team from 65 to 35 people. 

He also brought rigor to the organization’s accounting of donations, ensuring accuracy. “Let’s say that you donate a pair of used shoes, and we valued it at $10, but we sold it for $1,” he says. “Well, the P&L officially looks like $10. Things are going great. However, the cash is $1. So, there was this big mismatch between how it looked and how it was.”

To increase transparency, he and the leadership team began regularly reporting on cash to their team. “That was not a strategy for the long term,” he recalls. “It was a strategy to get to the next page. It was a survival strategy.”

Expanding a charitable mission

Today, Soles4Souls is thriving. In addition to helping entrepreneurs in developing economies, it has provided new, branded athletic shoes to 500,000 young people experiencing homelessness through its 4EveryKid program, founded in 2020. It partners with schools to provide the footwear to children and teens. It also distributed 79,000 new items to organizations in the Southeast, helping people impacted by Hurricanes Milton and Helene in 2024. It partnered with local nonprofits to distribute clothes and shoes..

Through activities like this, it has contributed to the “circular economy,” diverting 9.2 million pounds of clothes and shoes from landfills in 2024 alone. Many partners have stepped up to help it continue its mission. The National Retail Federation Student program, for instance, collected shoes at 70 universities in a year-long shoe drive. 

Looking to the future

Teaster is optimistic about the organization’s future. Despite economic constraints facing the footwear industry, Soles for Soles is now exploring the possibility of acquiring a for-profit business to fuel its growth.

“Ten years ago, this economy would have killed Soles4Souls,” he says. As a result of using the Scaling Up platform, he says, “We have ways of talking about it and thinking about it that have allowed us to weather it. All of these things will allow us to get to the future.”