10 Things You Must Know Before You Start a Nonprofit

Posted on Posted in Welcome and Other Inspiration

If you have started a nonprofit or helped grow a small nonprofit you know it is challenging.

Since 2000 I had been working with women and leaders as a life & business coach, speaker and author with a passion to help women fulfill their purpose and their greatness, and design lives they love. However in 2007 I decided to stop volunteering with girls charities and do something bigger instead. It was never meant to be a nonprofit or an ‘organization’. But once I learned that 14,000 teen girls were getting pregnant each year in my state, along with the statistics of girls who dropped out of school, crime, sex trafficking and the growing trends of cutting, I felt compelled to make a difference. It wasn’t just the negative statistics that fueled me, but the everyday girl who didn’t know her power, didn’t know her greatness and didn’t know her valuable place in the world. We started with one workshop and today we have 5 empowerment and leadership programs including a 7 day leadership summer camp and an annual mother daughter summit. It’s a 501c3 with 2 Boards, 5 programs, live events and it keeps my pretty busy. I have a deep passion to ignite greatness in women and girls worldwide through my coaching practice and this nonprofit. It makes for a full 5 day work week and I’ve learned so much along the way. My biggest lesson is that ‘being on a board’ for a nonprofit and ‘owning/running a nonprofit’ are two different worlds. The logistics, legality, fundraising, leadership, board management, vision and programs that are needed to be successful is not for the weak-hearted. You have to bring your courage and your patience to learn along the way.  Below are my top six biggest lessons that I wish I knew before I started a nonprofit, along with 4 additional tips from friends of mine who also started nonprofits.

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10 Things You Must Know Before You Start a Nonprofit:

  1. Time allocation: When you are starting a nonprofit you are often being driven by passion or purpose. However, if you become a 501c3 the positive side is that you will make an impact/difference. However you have a tough 1-3 years ahead of you. Often, for the first three years you will probably spend 60% of your time is managing the organization, doing legal, insurance, donors, customer service, learning nonprofit systems, putting policies in place, growing your board, making sure financials are being tracked, learning how to lead volunteers and board, setting up donor systems, creating your donor pitch, creating fundraising plans and finding your nonprofit case.
  2. Recruitment, training and maintaining the board: the board is a huge part of your nonprofit. It’s required and it’s crucial that you and your board work well together. Do your research on building a board (Board Source is good) and know what kind of people you need and what by laws, policies and training you need in place. The board needs to be passionate about your mission, about fundraising and about building the organization, not themselves.
  3. Fundraising is a full time job: If you are building a nonprofit alone or with one or two cofounders you will have to focus on fundraising. Don’t let the ‘nonprofit tax status’ confuse you. Nonprofits are a business that must make money. The only difference is that the profit that is left over from paying your expenses will go back to the organization, not people/ceo/founders/board. There are 1.2million nonprofits in America and nonprofits employ 11% of our workforce. Whether your budget is $100k or $5million you must have plans on how you will achieve it. Depending on what sector you are in depends on where your funds come from (i.e. grants, donations, government, earned revenue). The myth that people “just write checks” for nonprofits isn’t true. Your programs have to be making a big enough impact to justify donations. Once you have programs working well you will be able to fund raise.
  4. Programs justify fundraising: one of the biggest mistakes to a new nonprofit founder is that they can raise money without implementing programs. In for-profit businesses you can get investors who give you money for your “idea”. That is not the case here. Programs have to have impact (be solving a problem (which is your mission)) and you have to measure your impact somehow. I didn’t know this and we didn’t measure our programs impact for the first four years (before we became a 501c3). To measure our impact we now give the girls a survey at the end of each workshop/program. It gives us feedback on the program but also gives us the measurement we need to apply for grants, get donations and grow. Focus on fulfilling your mission through your programs and measure your success, THEN your fundraising will be so much more successful. You want to be able to tell stories of success from your programs to donors!
  5. You are always: recruiting/working with board members, selling/fulfilling programs or raising money. It’s a big job that takes focus, leadership and planning. In the for-profit world you sell one customer your service and you fulfill on it. Done! But in non-profit you have two customers: finding those who will fund your organization and finding those who will utilize your organization/service. The more you know the better you will do! The world needs your passion!
  6. Be clear in your mission: As the previous 5 items will show you it takes a lot to start and grow a nonprofit. But when you are CLEAR in your mission and there is a CLEAR need for your mission then move forward with velocity. Be unstoppable and have fun doing it! Use resources like Board Source, the Alliance of Nonprofits, the Chronicle of Philanthropy and google to help grow your nonprofit leadership. I learned that my mission is wonderful, however my nonprofit leadership needs to be equally wonderful. Lastly, I’m always a student and always learning to be a better leader so I can move my movement. Even if you are a for-profit company who wants to be a ‘force for good’ by doing nonprofit projects, fundraising or volunteering it’s best to have a clear, aligned plan that works for your company, your mission and your values.

Below I added a few nuggets from friends who also started nonprofits, check them out:

From Pam Gaber, CEO and Founder of Gabriel’s Angels:

7. The natural complexity of the Nonprofit “Resource Engine” i.e. Fund Development requires a profound and  penetrating insight and precise clarity than your average for profit business.

8. I would need to hone my leadership skills to work with a volunteer board of directors.  This form of leadership is “legislative” and not the typical “executive” style leadership seen in corporate America.

 

Cori  Matheson,  Girls Golf PGA:

9. I never knew how much the relationships I have grown and bridges I have built would ultimately contribute to the overall success, sustainability and progress of Girls Golf of Phoenix. If the relationships are valuable/positive I can lean on them to grow the business!
10. Have fun!!!!! If I’m having fun so are my members!!!! Creating a fun, energetic and engaging atmosphere empowers ME and my customers! It is up to me to think outside the box, be a little wacky, sprinkle some glitter and trust my creative gut for the progress of FUN!

I hope this helps you succeed in your company or nonprofit/philanthropy projects so that you can continue to change the world. Want more nuggets? Listen to a full podcast episode filled with tips and stories here.

Need help staying in your greatness everyday?
Check out my new book The Greatness Game here.

 

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Dena’s passion is to help women entrepreneurs structure, market and lead their business to the next level of greatness and revenue.  Let’s start today.

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One thought on “10 Things You Must Know Before You Start a Nonprofit

  1. I’ve always thought it would be amazing to start my own nonprofit. I’m sure when it is just starting out, it’s important to focus on fundraising. I can imagine it would be a full-time job, so it’s a good idea to find someone to work for you on that exclusively. I also agree that no matter what your budget is, you should have a plan on how to achieve your monetary goals, like you said.

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