Oregon’s best-known entrepreneurial organization will lay off three of its four employees and dramatically curtail operations after the nonprofit’s new executive director discovered a major funding gap.

The Oregon Entrepreneurs Network had projected an operating loss in 2020 and was counting on reserve funds to overcome the shortfall, according to Amanda Oborne, hired as executive director in November.

“The board well understood the organization needed to be on a turnaround path,” Oborne said. Over the past couple years, she said, “The sponsorships had atrophied.”

However, Oborne said she discovered in January that the reserve money included program funds and grants that came with restrictions on how the organization could use it.

“It was just understood that we had a longer runway than we do,” Oborne said.

Left with a roughly $300,000 hole in OEN’s $1 million 2020 budget, Oborne said the board considered either shuttering the organization altogether or taking “draconian steps” to reduce costs.

OEN’s board opted to continue operating on a reduced scale. In addition to the three layoffs the nonprofit will end support for programs including the Venture Catalyst Network, which supplies entrepreneurial coaching in five different regions around the state. Oborne said efforts are being made to find other support for the network.

OEN will make additional cuts in its contracts and programs but intends to continue its annual awards program, to be held next October, its monthly PubTalk networking events for entrepreneurs, and the Angel Food Conference – a funding competition formerly known as Angel Oregon.

“I think the organization didn’t watch closely as the nature of the (environment) in which they were operating was changing,” Oborne said. The organization was evolving, she said, but not as fast as it should have.

Oborne’s predecessor, Maggie Finnerty, resigned last summer to tend to family matters. Finnerty said Thursday that she was caught off guard by the degree of financial distress at OEN.

“There were certainly budget issues in the past. Lots of nonprofits struggle with funding,” Finnerty said. However, Finnerty said she had no inkling the funding situation had presented an existential crisis at the nonprofit.

The organization started in the 1990s and aims to help build resources and connections for entrepreneurs around the state. Portland attorney Mary Hull, chairwoman of OEN’s board, said the funding environment for Oregon’s entrepreneurial organizations has become more competitive in recent years.

“It’s a crowded landscape,” Hull said. “We’re going to focus on the core things we do best.”

Other organizations have expressed support for OEN, according to Oborne, and offered assistance in helping the nonprofit find its footing and sustain some of its programs. She said the cutbacks will force OEN to take a hard look at its priorities and focus on the areas where it can have the most impact.

“I feel really optimistic about it,” Oborne said, “although it’s going to be really painful.”

And though Oborne said she thought she would be running a four-person organization when OEN hired her last fall, she said intends to remain in her new job as the sole employee.

“I’m staying on,” she said. “I’m going to learn really quickly what it means to be an entrepreneur.”

Correction: The spelling of Amanda Oborne’s name has been corrected.

-- Mike Rogoway | mrogoway@oregonian.com | twitter: @rogoway | 503-294-7699

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