the profit center is now purpose capital
Determining how to fund your nonprofit can feel like a daunting task. The pressure to get dollars in the door is immeasurable and can significantly stress the process of starting or maintaining your nonprofit organization.
There are many different ways to secure funding for your nonprofit, both as you get it running and as you look to keep it running with consistent funding. Before you determine which funding source is right for your organization, there are a few key steps you should take which will prepare you to make a decision.
It can be easy to fall into a place of reactive fundraising when you’re running a nonprofit organization. However, when you take the time to thoughtfully plan your fundraising model, you can make a bigger impact than you ever could with reactive fundraising. Identifying your funding needs and what funding model makes the most sense for your organization can save you headaches down the road.
Get a deep understanding of what you’re already doing and what your current funding sources are. Determine what return these funding sources have and if they’re aligned with your organization’s values. As you do this, keep an open mind to see if there’s room for moving into other funding sources or even moving away from funding sources that don’t match your organization’s vision.
Get your team together and have brainstorming sessions. Compare what you’re doing to what similar organizations are doing – could you implement some of the same funding models? Creativity is key; there are no wrong answers in the brainstorming session.
Determine how much you could feasibly fundraise from each funding source. Take the results of your brainstorming session and narrow them to only the options that align with your organization’s values and are replicable, realistic, and sustainable.
Once you’ve narrowed down your options, commit to one or two of the choices on your shortlist. Develop an implementation plan for each one that will be actionable.
While there are numerous ways that nonprofits are funded, there are six ways that are replicable and sustainable in the long term.
Grant funding can be demanding to obtain. You must first find the grant that fits your nonprofit and then write the grant application. This requires hours of detailed and dedicated work but can make a huge difference in your organization.
Many different organizations provide grants to fund nonprofits, and winning grant funding could provide you with anywhere from hundreds to millions of dollars for your nonprofit.
If you choose to pursue grant funding, be sure to fulfill the requirements for each grant that you apply to and have a strong grant application. You’ll likely be competing with many other organizations for the same opportunity.
Funding through events can also require a great deal of work, but it can be fun too! In generating awareness of the event, you can solicit donations and support through a fundraising campaign for the event.
Events are easy to market today – you can take to social media, design flyers, or come up with another creative idea to get the word out! Hosting an event also gives you an opportunity to have an auction or another paid activity at the event venue, which can continue the fundraising efforts.
This is, by far, the most common way nonprofits raise money. With nonprofits now having an online presence, it’s easier than ever to get donors to donate and support your nonprofit’s mission.
Putting a donation option on your website puts you in control. You can create a landing page to boost online donations and attract new donors regardless of their physical location.
Direct mail campaigns can be an effective fundraising method for specific donor segments – particularly for smaller or local nonprofits or those targeting older donors. Using a direct mail campaign allows you to give your potential donor detailed information that you couldn’t provide in a short-form digital space.
While direct mail campaigns do take time and effort – you have to write the letters, create the list, track responses, update addresses, etc. – you could find this to be a successful funding method if your donor segments match the criteria.
Text-to-give donations are made via a mobile phone, usually by texting a keyword or an amount to a dedicated telephone number. In response, they’re sent to the nonprofit’s mobile donation page.
This can be an easy and convenient way for donors to give to your nonprofit. It’s a quick effort, so it’s unlikely that time spent will deter your donor from giving. And most of the software will retain donor information, so if they want to donate again in the future, they can simply confirm a donation by texting without an additional form fill.
The software can be pricey and put caps on the total amount that can be processed as a donation, making text-to-give only valuable in specific scenarios.
Corporations are often looking to partner on projects that allow them to work towards becoming more socially responsible organizations. Consumers care now more than ever about the social responsibility of the corporations they do business with, making companies care more about their philanthropic image.
Corporations have varying giving programs, and some may fit your nonprofit organization. As you look towards accepting a partnership with a corporation, ensure that they align with your nonprofit’s mission and values, and you can’t go wrong with using this funding source.
There are many other unique and creative ways to fund your nonprofit. Whichever funding model you choose, it’s vital that you make sure it’s the right model for your nonprofit. If you go into the funding with a plan that aligns with your nonprofit’s vision and values, you’ll be sure to come out with a funding model that helps you deliver on your mission.