The Other Side Academy is a nonprofit equipping formerly incarcerated individuals with the skills and opportunities to break the cycle of recidivism and contribute meaningfully to society. This episode explores their model, future growth, investment opportunities, and why outcome measurement is essential to driving real impact.

0:00 | Intro

1:24 | Meet Joseph Grenny and Tim Stay - backgrounds in behavior change, entrepreneurship.

4:09 | What is The Other Side Academy - Jordan, one student's story of change.

6:45 | The Model: Become a better person by practicing being a better person. Utilizing social enterprises and peer community to drive change.

8:30 | Defining Success through Outcome Measurement: Drug-Free, Crime-Free, and Employed.

11:13 | How does TOSA measure these outcomes?

13:00 | National Recidivism vs. TOSA's Record.

13:48 | Long term support and life after graduation.

16:53 | TOSA's growth and expansion.

19:30 | Support TOSA's incredible results by investing in their growth.

23:57 | Why is TOSA so successful? How does their model work?

26:43 | There is no therapist at the academy... Supportive peers are a better alternative.

29:07 | Impact Opportunity: Invest in The Other Side Academy though your DAF or Foundation.

30:30 | Impact Inbox: Is high overhead bad? Understanding the Overhead Myth!

Links from the Episode

Learn more about the TOSA here: https://www.theothersideacademy.com/

Invest in TOSA here: https://iig.uicharitable.org/impact-opportunities/post/debt-investment-the-other-side-academy-N0rKB3YLqtH9lIw

More Impact Innovations content here: https://iig.uicharitable.org/

Transcript

Tanner Mills - Welcome to the Impact Innovations Podcast, where we elevate philanthropy to be more effective through collaboration, learning, and innovation. My name is Tanner Mills, a member of the team behind the Impact Innovations Podcast and an associate at UI Charitable Advisors. This is episode four. Today, we are excited to share the incredibly moving story of The Other Side Academy, an innovative nonprofit that's tackling the complex problems of addiction, crime and recidivism, which is the tendency of a person to re-offend.

The Other Side Academy runs an intensive two-year residential program that blends vocational training, education, peer mentorship, leadership development, and transitional support. We recently met with their team at the Other Side Academy and learned about how their program is not just keeping people out of jail and off of drugs, but is as they say successfully helping them to create purposefully connected and happy lives.

Later in the podcast, I will share this month's impact opportunity where I'll dive into how you can invest in the Other Side Academy. Our co-host Jaxson Thomas will then respond to a social impact question from one of our members.

Todd Manwaring - Great having you all here today. We're excited to introduce you to Joseph Grenny and Tim Stay, the founders of the Other Side Academy. Joseph I actually met about 25 years ago, moved into his neighborhood and together we got Unitas off the ground, something you'll hear about in their bios here in a minute. ⁓ Joseph is the chairman of the board for the other side Academy. co-founded Vital Smarts, has written a number of ⁓ New York Times bestsellers. Many of you will recall Crucial Conversations, Crucial Accountability, the Influencer book, my favorite of the series.

And he's also the chairman of the board of Unitas Labs as it continues from its start back in the 1990s. He and his wife joined a team that created the Other Side Academy in 2015. And Tim is a member of that team who was part of that co-founding here of the Other Side Academy. He is the CEO and has been involved in a number of high level roles as CEO in a number of tech startups and other entities. He was co-founder or he started and ran Marketing Ally, started and later sold free servers to about.com. Co-founder of Biz Cradle, a business incubator. And so he's been involved in all of these different things. 

There's one piece on his bio I thought was interesting to share. He's a community council chair at Lake Ridge Junior High and at Mountain View High School where his children go. And he serves on the Utah State Board of Education Advisory Panel, trying to help other schools understand how to grade and run those kinds of groups.

We're grateful to have both of you here with us. Also as panelists, you can see we have Tanner Mills. He's an associate with us here at UI Charitable Advisors. He's been with us for four years and he works on this Impact Innovation Group team along with Jaxson Thomas, who's been with us this past year.

They will be leading the discussion and I'll be following that up with training on outcomes using the other side Academy as an example. I'll turn some time here to Jaxson, who will start with some questions. Yeah, let's dive right in.

Jaxson Thomas  - Thank you, Tim and Joseph for being with us today. I just want to start by asking a question to Tim. Just giving us a general understanding of who the Other Side Academy is. Using an example of one or two of your students, can you kind of describe what the Other Side Academy does? 

Tim Stay - Absolutely. Let me tell you about a man named Jordan. He was raised by a single mom, and didn't have a lot of structure in his life. He grew up a teen that got in trouble a lot when he got into his 20s, on meth, and that led to his first felony charges at the age of 23 and he started a career of going in and out of prison for many years. He wound up spending a total of 11 years in prison, became a career criminal and a drug dealer and destroyed any connection with his family, hurt people, and he was facing a 15 year prison sentence for his latest round of crimes when he got a chance to hear about The Other Side Academy. 

A judge allowed him, suspended his sentence and said, if you go to The Other Side Academy, I'll suspend your sentence. And if you complete the program, we can waive it. If we don't complete the program, then you'll have to serve your time. So he came to The Other Side Academy. It was life changing. He changed his whole way of thinking. He changed who he was. He learned how to have integrity. He learned how to work hard. He learned how to ⁓ give feedback and learn how to connect to others. 

He wound up staying not just the two and a half years at The Other Side Academy but for a total of four years at his own choice at no cost to him and he wound up graduating and he today he's overseeing one of our social enterprises The Other Side Builders. He has his general contractors license which we helped him get and he's running a business that saves us millions of dollars in internal renovations as well as generating revenue ⁓ for doing many other commercial projects around Salt Lake Valley. So that's the type of transformation we see.

Jaxson Thomas - Thank you for that. Joseph, now turning to you. What is your typical elevator pitch of who The Other Side Academy is? 

Joseph Grenny - So the Other Side Academy is a two and a half year minimum residential free program for people with long histories of crime, addiction and homelessness. That's the elevator. Now, if I had three more floors for the elevator. I would tell you the people in pictures in front of you are students at the Salt Lake and Denver campus who collectively were facing about 2000 years of incarceration. So that was plan A for them. Plan B was to come instead of that incarceration to The Other Side Academy and figure out how to reinvent your life. Our challenge is that the campus is free, but we don't accept money from the government, from insurance or from participants. You don't pay to come. It's important that it's free.

And so we operate through running social enterprises. This is both the therapeutic model and the funding model. It's the therapeutic model because we believe our students' challenge is learning to live life differently. And the best way to learn to live life differently is to live life differently. So for two and a half years, they're working. They work in The Other Side Movers, which is the top rated moving company in the entire state. And it's run by a bunch of criminals. 

We run The Other Side Thrift Boutiques. Two award-winning boutiques that carry wonderful furniture and clothing and other items that again are run by a bunch of criminals. And with loyal clientels, people that love these organizations because they're jealously guarded, the brand is by our students. And ⁓ so this is how people's lives change. They change by practicing living a different life. So that's us.

Tanner Mills - That's great. Let's talk a little bit about outcomes. On your website, there's a page that's called results. I'm just going to read a little bit of what it says there. It says that The Other Side Academy is not just about getting people off drugs. It is about helping people create purposely connected and happy lives. Ultimately, the only real measure of our work is how many of our students develop the character required to create that kind of life. That is our ultimate goal.

Our minimal goal is that in the years after graduation, our students are drug-free, crime-free, and gainfully employed. So Joseph, can you just help us understand a little bit about how and why you chose these outcome goals for The Other Side Academy? 

Joseph Grenny - Yeah, we believe that no nonprofit deserves to exist unless it declares what its intentions are, measures them rigorously, and transparently shares them.

So when Tim and I started The Other Side Academy, we made it very simple and clear, drug-free, crime-free, and employed, that's it. We're not gonna confuse it with 15 other measures. If somebody comes in having been a career criminal, having been a long-time drug addict, having been homeless or what have you, our job is to change those basic features. So the marvel of the Other Side Academy is that in the last nine years, we've had adult probation and parole come in and randomly drug test our students repeatedly. Every month they come in.

And we haven't had a single dirty drug test in almost 10 years of operation. We have a standing offer to Brigham Young University, an institution to our south here, that our campus is more sober than theirs. And we stand by that claim. But secondly, all of them, when they are graduated, have multiple job offers, 100% employment, 88% of our graduates. We track all of them on an ongoing basis have remained crime-free.

We've got a 12% recidivism rate compared to 100% recidivism rate if they hadn't come. This is one of those marvel moments that Tim and I get to experience. We went to court with Jordan, who's the second from the left there. Got his arm around my wife, Selah, and Dave DeRosha, our executive director.

And he stood in front of a judge and the judge literally looked from a stack of felonies in front of him, Jordan's case file, back at Jordan, back down, back up three or four times and finally took his glasses off and said, ⁓ I don't recognize you anymore. The judge got a little tearful and said, I don't ever see this happen in my court. And on behalf of the state of Utah, you're forgiven.

So he was forgiven in that moment of a 15-year outstanding sentence, and he's gone on to live exactly the life that the majority of our graduates live.

Tanner Mills - Tim, how does the Other Side Academy go about measuring some of these outcomes and how difficult is that work?

Tim Stay - Crime-free and employed are fairly straightforward. We have access to the Utah court system records so we can check and see if any of our graduates have been arrested or any of them facing charges ⁓ employed. We can check and verify employment and things. Drug-free is the most and what we've done there is rely upon our network of graduates. We are able to track and see where all our graduates are, what's going on. If they're active with our alumni, if they all of sudden disappear and we can't find them and things like that, then we have a good indication that their life is going in a different direction. 

So we feel like we have enough of a connection with all of them to be able to get a pretty good idea on drug three. The other two, we feel really confident in those numbers. 

Joseph Grenny - And I'll add, I think what Tim's describing for those that aren't familiar with the measurement we're trying to do is a much more serious approach to measurement than the typical quote unquote rehab.

What they tend to do is send a mailer out to their graduates, say, are you using drugs? Typical drug addicts are not going to respond to that, or they're going to lie when they respond. But they take the responses that they get, and they average that as the number that they'll report. So it's a ⁓ spurious kind of way of doing it. Yeah.

Tanner Mills - Joseph, what trends have you seen in the recidivism space and how does the track record that we're kind of just talking about with outcomes, how does it compare to other groups or to even just those who don't receive any help? Yeah, again, our students have a hundred percent chance of recidivism. The vast majority were on their way to another prison sentence already or another jail sentence. And the average student has been arrested 25 times prior to coming. So the smart money was on, they're on their way back yet again.

And so the fact that it's been a 12% recidivism rate over the past nine plus years, and even more so for those that choose to stay longer, which most do like Jordan did, the recidivism rate drops to as low as single digits. So it's a remarkably different outcome. 

Tanner Mills - That's great. So just following that a step farther. So Tim, we're mentioning that there's the ability for the students to stay beyond the two and a half years. So what's occurring during that last extra time or in those final years that bring the additional change into their lives.

Tim Stay - Well, sometimes our students have been engaged in this lifestyle for many decades and certainly two years is longer than 60 or 90 days. But sometimes even two years or two and a half years isn't long enough. And they need a little more time just to be practicing living life the right way until ⁓ they really feel like they've got it in their soul. I really feel like they've become a new person. 

And during that time, they're also engaged in leadership. They're helping serve others. They're helping the newer members in the house. The last part of their stay, they go through what we call a workout phase where they'll find a job out in the community. We'll help them with that job. We'll help them with transportation, but they're still living on campus. And ⁓ they're saving up their money that they're earning.

And so when they graduate, they have enough money to get into an apartment. We've learned that that still isn't enough, that we need to provide a really robust aftercare portion of our services. ⁓ So after they graduate, and I didn't realize how difficult that transition back into society. 

You know, for two and a half years, they've been in a safe protective bubble, but now they're starting to get on Facebook. They're starting social media. They're starting to see their old friends pop up there. Sometimes it's their family that are the real challenges. Old friends are saying, hey, where have you been? Why don't you come hang out with us? And they're having to navigate. All of sudden they have freedom of a car and the freedom of a cell phone and the freedom of a smartphone you know, internet access and all these new freedoms, you know, in many ways it's like a teenager. If you give them too many freedoms too soon, they crash and burn. And so helping them navigate and kind of regain their footing back into normal life. 

So we have a rich aftercare program that helps them try to navigate. have graduate housing just across the street from our campus that they can live in at reduced rent. have a savings program where their savings is matched and ⁓ they can save up a sizable amount to be able to get into a car, be able to get into a location. And if people stay through that process, they can do, like Joseph says, drop into the single digits for recidivism. It's really remarkable to see the transformation there.

Jaxson Thomas - It's incredible to see the outcomes that you're measuring and the impressive track record that you're seeing with your students. Shifting now to the growth that your organization has seen. Joseph, since its start in 2015, The Other Side Academy has seen a lot of the number of students that you're serving, the growth of these social enterprises that you've talked about, the properties that you've owned. You mentioned that you're here in Salt Lake, but also now in Denver.

Help us to understand the current growth and the future growth of the Other Side Academy.

Joseph Grenny - Yeah, I mean, the most important growth is this. It's all about the mission. It's all about helping Tiffany get from that left picture to that right picture. And that's enormously challenging. But as far as physical growth goes, the social enterprises have grown enormously. We now run a moving company here in Salt Lake City with 15 trucks, over 300 moves a month.

So this is a serious enterprise. And by the way, it's run by one of our graduates. So a guy who was on his way to a gang career is now running a multimillion dollar social enterprise and continues to transform and grow his life as a We have ⁓ four social enterprises, The Other Side Builders, The Other Side Boutiques, The Other Side Builders, The Other Side Thrift, and The Other Side Storage. 

We have a second campus. Our Salt Lake campus has seven buildings and all of those have been acquired through the industry and work of students as well as those who've been helpful with us in donations and ⁓ debt relationships. The Denver campus has 80 students and I think six moving trucks and a thriving thrift furniture boutique and just a terrific reputation in the community as well. 

One of the marvels of the academy also is the neighbors love us. Who would have thought that you could move 150 criminals into a residential neighborhood and have the neighborhood actually love and respect and want you there? The Salt Lake police have shown the crime rate dropped since we arrived. So, you know, the model works. This is Diego who runs the moving company now. Tori here runs the women's program, and married a graduate. And Greg here helped open a second campus in Denver. Those are the kinds of growth that are meaningful to us. 

I guess the last thing I'd say that ties a bow on it is since about a year and a half into our operation, we've been economically self-reliant. So the students through these social enterprises will bring in $11 million this year. That allows us to operate the program in a way that takes care of the students first rather than trying to pander to some sort of government program. So that's been critical to our success.

Tanner Mills - So Tim, let's start talking about some of the opportunities. So you have a current loan opportunity. You've recently purchased a property for growth that we've kind of been talking about through a commercial loan. And you've got a number of these commercial loans at very high interest rates. So help us understand what those costs look like over there at the Other Side Academy.

Tim Stay - Since 2015, we've grown our campus and this includes Salt Lake, Denver, and also our secondary project called the Other Side Village, to about $60 million in assets. A lot of those, most of those are buildings. We do have some of our trucks and fleet in there. And some of the buildings we were able to pay for in cash and some we took out loans on. So we currently have about $8.3 million in mortgage loans and we're paying about just under $500,000 a year in interest expense. We have a variety of loans, some that we got earlier when interest rates were lower, some more recent when interest rates are high, but on average around 6% interest rate.

Todd Manwaring - And really, think, Tim, you and I have talked about this opportunity to help reduce this burden of this $500,000 yearly interest expense by having people participate in an impact investment debt opportunity where we would reduce the average interest rate from 6% to 4%. Some of those are higher. They're in the 8% area. Move those to 4%. Some of them are at 6%. Let's move those to 3%. And some of those you might have at 4%. Let's see if we can move those to 2%. And there might be some people who are interested in just the fact of participating in this and not even receiving interest back, but the funds coming back. So a 0% interest rate on that debt.

Tim Stay - One of the challenges with impact investing is how do you invest in a nonprofit where there's no equity and you can make a donation and we always love donations. But this was a vehicle that we saw that, someone, and maybe you can go to the next slide Joseph, if we were able to cut our interest rate, you know, 6% to 3%, that roughly moves our yearly interest expense to about $250,000. That's over 10 years. That's the same as making a $2.5 million ⁓ donation to us. And you get all your money back with a 3% interest rate. 

If you moved it down to 1%, that's equivalent to a $4 million donation to us. But again, you get your money back and you get a little return on top of that. So we thought this was a way for those who say, I really like the space that The Other Side Academy is in, helping transform lives. It's here in the US. It's not something overseas. And it's helping ⁓ us reduce our expenses so we can put more of our money towards helping more people. 

And it's a really secure, we've got ⁓ just a really great financial statements, really healthy, very low risk vehicle to be able to do this. 

Todd Manwaring - Right, no, I like what you just mentioned because I think this would, for some people who are just getting used to the idea of impact investing, here's an opportunity in the US. And so we have all of the rules and laws that, you know, with that perspective here, and all of these loans are collateralized because they're property and different, you know, items like that you mentioned, some trucks as well. And so I think this is a great opportunity for people to participate and really learn about impact investing. And then some people who've been involved in this for years to really take this to the next level.

One of the questions I think that I've always wanted to understand better is what does the training look like? You've mentioned your focus and work on people having a job and that's a big part of it and that that job with your social enterprises helps fund what's going on.

Give us an idea of what else is going on in the Academy that's helping people change their lives from one of really being someone who's duplicitous, a deceitful to their own family even, and changing, as you've mentioned.

Joseph Grenny - Yeah, so the core of the model is it's a peer community and who best to understand what you need to change in order to get to a better life than someone who's done it. So Jordan Holdaway, who Tim mentioned earlier, is a leader in the house now. And when a new student comes in who's lazy, he sees it in them. If they're dishonest, if they're sneaky, if it looks like they're trying to figure out what they can get away with, which, you know, those are the habits that most of our students come with. The question is, how do you help people change that? 

Well, apparently 25 arrests and incarceration for multiple years hasn't done that job. What does do it is peer pressure. So there are three things we ask of all of our students when they come. Pull people up, pass information, and participate in a group. So pull people up means that if Jordan or anybody sees somebody doing something inappropriate, they're immediately corrected. By whom? Not by staff, not by some abstract administration, but by a peer, by a student. 

Second, they let everybody know they pulled that person up. So now the whole organization, the whole team, the whole family knows that Tim's a liar. You know, I'm using this hypothetically. That he struggles with that. Or he keeps looking at the women and he's trying to make contact with them and he thinks he's gonna hook up while he's at the Academy. So if he's doing the creep thing, people know that he's doing the creep thing. 

And finally, every Tuesday and Friday night, 7:30, we'll sit in groups of 20 and we give each other feedback. And it's tough to hear because it's difficult to hear the truth about yourself when you haven't wanted to hear it. So that process of just regular feedback and verbal correction by peers is a powerful, potent source of influence that's the core of how we change lives. In the context of us needing to be out on a move, needing to be in the thrift store and so forth, that's just real life happening and that's the Petri dish in which your personality or your character reveals itself. So that creates a rich opportunity for people to see.

Are you dishonest? Are you sneaky? Are you selfish? Do you have a bad temper and so on?

Todd Manwaring  - And it makes a lot of sense. think something that's tied to that, I know that I've been in different opportunities with you and people have asked questions. One that they're surprised at is there's no therapist at the Academy. Tell us a little bit about that and how that therapeutic model that you described, you know, leaves that not to be needed. 

Joseph Grenny  - Yeah, it's factually correct to say that, but substantively wrong because we really have 149 counselors. So what we got surrounded by people that really are the therapists, it's peer therapy. And it's an apprenticeship model so most of our students have been to traditional therapy, traditional counseling. They've been at this program in jail or somebody sent them to drug therapy and in that they had group processes. And so they've been through all of that and it didn't help. It didn't work. And part of the problem is the messenger. 

So, you know, I've watched situations where somebody struggled with just chronic pathological lying and will be in one of these feedback groups on a Friday night and somebody else in the group will read them the riot act about how it affects the rest of us and we don't trust you and then they'll finally, there'll be this pause and they'll say, you know what? The reason I know that this is what's destroying your life is because I was you nine months ago.

And then the eyes open wide and then they start to listen differently and the person tells a story about how they were when they arrived at The Other Side Academy and that's when everything starts to change. The fact that this person has been through that same struggle gives them the moral authority to get in your face and to challenge you and to tell you how it's playing a role in affecting your life and the lives of others. So you got 149 therapists and that's better than one. 

Todd Manwaring - Right, well thanks for sharing that. Well, thank you for being with us. Thanks for your answers and your insight into this world. And thank you so much for the work that you're doing with the people that you've mentioned and with the new opportunity you're focused on with The Other Side Village and helping those that are homeless. I understand that the first people getting into the village is happening in the next few weeks. And so we'll be excited to hear more about that.

Thanks everyone for participating. Thanks. We'll see you later.

Tanner Mills - Welcome to the Impact Opportunity, where each episode we spotlight one of our funding opportunities. Today's opportunity is a loan to The Other Side Academy. Many of you may be asking, how can I invest in a nonprofit when ownership? Well, as you heard, TOSA is growing very rapidly. And to finance this expansion, they've taken on multiple commercial loans. Many of those are at high interest rates.

This opportunity allows you to restructure some of that debt by replacing it with your mission aligned capital. Your investment helps lower the financing costs by lowering the interest rate on many of their loans. As an example, recently we arranged an $80,000 loan that financed a moving truck for one of TOSA's student run moving companies. 

That single asset is projected to generate over $2 million in revenue over the lifespan of that moving truck. And it also supports the Academy's operations while also providing dozens of their students with meaningful employment. The investment terms of this opportunity are five-year loans of a minimum of $50,000 that would return 4% interest that's repaid quarterly. If you have any questions about this opportunity, please get in touch with us at impact@uicharitable.org.

Jaxson Thomas - This is Jaxson Thomas with the Inbox. In this segment of the podcast, we take one question from one of our listening members about social impact or philanthropy and answer it here on the podcast. This month's question is, “I always hear that overhead at a nonprofit is a clear sign of waste and tells me it's a bad organization. Is this true?” 

There are a lot of misconceptions about overhead in the nonprofit space. We like to call it the overhead myth. The first point I would like to mention is whenever we look at an organization to try and understand its effectiveness, we first look to see if they're measuring and understanding the outcomes or results of the programs that they're running. This is the most important point above their financials, any other aspect. If they don't know what they're doing is good for the people that they're serving, then it doesn't matter how much they're spending on overhead. If it's high or low, we need to first understand what they're doing and the effect that it's having.

The second point to the overhead myth is that overhead isn't necessarily or automatically bad. To clear this point up a little bit, we think of nonprofit organizations similar to businesses. In businesses, people hire the best people for the best results, even if those people can be expensive. That's the same for nonprofits. If we want the best results, we should hire the best people.

If overhead is too low, nonprofits can lack the technology, the resources, and the bandwidth to successfully accomplish what they're trying to do and elicit the effects that they want to have on the people that they're serving.

To summarize, as concerned donors, should first focus on whether organizations understand the effect that they're having on the people that they're serving and if that effect is positive.

Once we understand this, we can take a closer look under the hood of their financials and better understand how resources are being allocated in the organization.

Thank you for joining the podcast today. We hope this conversation was insightful and inspired you to approach philanthropy with more intention, strategy, and effectiveness. Please subscribe and leave a review as our podcast grow and expand our reach.

To continue the conversation or access additional resources, you can visit us at iig.ucharitable.org or contact us at impact@uicharitable.org. Thanks for listening and we'll see you next time.

(End)