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Social Service Mergers: Hope Services & Skills Center

Social Service Mergers: Hope Services & Skills Center

Victoria Chang and Walter W. Powell

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The case study discusses San Jose, California-based nonprofit HOPE Services’ merger with Santa Cruz-based Skills Center. Thanks to the merger with Skills Center, two additional acquisitions, and the development of new business ventures—HOPE had increased in size to a staff of more than 600 and an annual budget of $38 million. Supporting revenue was derived from 56 percent government contracts, 29 percent program service revenue earned from commercial projects, 12 percent philanthropic support, and 3 percent indirect support from miscellaneous sources. All parties believed that the merger, completed four years previously, had been an overall success. But in common with most for-profit and nonprofit mergers, especially in social services, the change was not without its costs and challenges.