How to Start Your Own Nonprofit or Charity
Three people who did it share what's needed to get one off the ground.
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Nonprofits are vital to our society. This third sector addresses vulnerable populations, natural landscapes, and cultural institutions that might otherwise be overlooked. And luckily, the number of nonprofits keeps growing—there are roughly 1.5 million tax exempt nonprofits in the United States. The unfortunate news is that, as it is with many small businesses, the Darwinian effect naturally takes over: some thrive, some barely survive, and others die out. The National Center on Charitable Statistics states that roughly 30 percent of nonprofits fail after 10 years because of leadership and strategic planning issues. To make matters worse, brutal competition among nonprofits to acquire necessary funding and donations is increasing.
To beat the odds, numerous involved steps are required from incorporating at the state level to applying for exempt status with the IRS. And while having a strong passion for a cause is also critical, it is—as disheartening as it is to say—not self-sustaining. A nonprofit is still a business requiring sufficient funds to get started as well as serious knowledge about the nuts and bolts of running an organization. For advice, we consulted three people: Annette Venables, founder of Tribe Rising India, a nonprofit dedicated to building schools to advance the educational opportunities of children of the Santal tribe in West Bengal; Marv Zauderer, founder of ExtraFood.org, a county-wide food recovery program in Marin, and Laura Talmus, founder of Beyond Differences, a nonprofit whose mission is to empower all middle school students to end social isolation through online and on campus programs.
Talmus starts the discussion of how to start a nonprofit by saying, "You must know the tenets of a good nonprofit. You need the right ingredients to get it done."
Have a compelling story.
Talmus recommends first asking yourself, "What is your reason for being, what are you offering?" The bottom line here: You must have a strong mission statement. And although Talmus didn't set out to start a nonprofit, her now 10-years-strong organization has school programs nationwide and in 12 countries globally. Beyond Difference organically grew out of the painful experiences her daughter Lili faced at school dealing with this invisible epidemic: social isolation.
Similarly, what started the idea of Tribe Rising India was Venables meeting Santal children; it became a mission is to eliminate barriers to education that are solely based on caste system prejudice, the color of one's skin or a family name.
To fail to plan is to plan to fail.
Doing your homework—that is, extensive research and planning—is crucial. And, unfortunately, it's easy to let hopes, dreams, and do-good enthusiasm cloud your vision. Start by making a strong business plan. Research the competition, seek out potential funding sources, and strategize on the products and services you might offer. Three plans to work out are a business plan, a strategic plan, and a fundraising plan. Zauderer stresses the importance of developing a diverse funding strategy involving individual donors, foundation and government grants, and corporate sponsorships.
When we asked Venables what she would've done differently, she candidly says, "My mother was right: I should have gone to law school." Venables comments that she should have started immediately with an attorney. "When you are trying to get the word out about your needs and set up systems of communication and events, every day feels like a week. When you have your tax exempt (501c3) designation—it opens up your possibilities and you can access additional support and discounted resources. It begins to give your passion an identity."
Put together an active board.
An effective board is the backbone of nonprofits. Gather people who have influence, various contacts, wide-reaching resources, and who share the same goals as you. The right people will help keep you on course, help secure funds, and provide personal expertise. Zauderer comments, "We identified the skills we needed on our founding Board of Directors, assessed our network for generous people with those skills, and recruited board members."
Reach out for help.
Many online and in-person resources exist to help support, grow, and sustain your mission, including fundraising resources and operational practices. But as Venables points out, "Not every expert is an expert who can help you. Some experts are used to designing and implementing large scale programs that rely on research, measurement metrics and funding streams that are ridiculous in our case." But she tells us she listened carefully and learned from everyone she met. Venables also relied heavily on her local Marin County experience with nonprofits (The Marin Foster Care Association, Kiddo!, and Schools Rule Marin, among others).
Definitely it pays to know your strengths and weaknesses, and don't be shy to ask for help. For example, CVNL (Center for Volunteer and Nonprofit Leadership) helps nonprofits of every size achieve greater impact through customized consulting solutions, plus they offer expert guidance, training, and resources.