The Hard Truths of Starting Your Nonprofit

 

“I have my 501 c 3! Now what?” the conversation began. It always begins that way. When a Founder has started a nonprofit but isn’t equipped to move forward, we walk through where they are and where they want to go. In my time walking through the question, I found some hard truths that Founders need to confront before they begin.

Before you start a nonprofit, you should think seriously about some truths of starting one that few people will tell you. Today, I’m telling you what those of us in the nonprofit world already have figured out.

 

You must establish need.

You have an idea of the service you think will help people in your community. Instead of plunging head  first into the time-consuming process of establishing a nonprofit, take the time to determine a need for your nonprofit. Research the number of people affected in your community by the cause your service will help. What effect does this problem have on the community?

 

You must do your due diligence to identify any other nonprofits in your area that solves for the same problem.

Funding comes easier when your services don’t overlap another nonprofit and you can show your idea is unique. Your solution should fill in a gap you find in the community. Think of it this way. You have a need you identified in the community. You have a universal ideal or your I believe statement that tells your why. Your nonprofit’s mission, purpose, and program is the how you see getting from where you are now “the need”to the universal idea, “I believe everyone deserves to have affordable housing”. Write this down to help you remain unique. Because an existing nonprofit isn’t doing something the way you would do it isn’t a reason to start a non-profit.

 

You must educate yourself on how a non-profit runs.

Nonprofits are not for profit businesses. They have their own regulations and ways of doing things. The ways often aren’t arbitrary. They are that way because of a law or regulation that must be followed to keep their nonprofit status. Volunteer for an organization that fits your passion. Volunteer in the office so you can see the inner workings. Volunteer in the development or fundraising department to learn what it takes to raise money. Finally, educate yourself by reading books on establishing a nonprofit and management of one. As the founder, you will need to understand every aspect of the nonprofit organization and how they work together. You don’t have to understand everything in-depth – there are experts and mentor’s out there that can help so don’t get stuck. Learn enough so you are comfortable with the topic and can follow along in a nonprofit conversation. At minimum, understand the major components to get started.

 

You won’t get a salary for a few years.

Founders often want to quit their day job and work full-time in their nonprofit. That is completely understandable. You have a passion for the mission and you have put work into the nonprofit. You think of it as your “baby”. The problem is a new nonprofit won’t have a lot of money for a few years and won’t be able to hire staff.

Another thing to consider is that board members aren’t paid. They have absolute control over the direction of the nonprofit and governance of the nonprofit. Executive Director is the first paid staff you will hire. An Executive Director answers to the board. If a Founder decides to become the executive director, they answer to the board and have no say in governing or the direction of the nonprofit. The flip side is they don’t get paid if they are a board member. So, in nonprofit work, you can have the pay or the control if you are a Founder but not both.

I went to talk to a Founder who asked me when he would be able to quit his job and replace his $100,000 salary. I had to break it to him gently that nonprofits that pay their top Executives anything close to $100,000 usually have a 10 to 20 million dollar budget. Those organizations have usually been around over 10 years.

 

Fundraising is hard and it has to be a focus.

It seems there is an abundance of consultants out there giving Founders the impression that there is a get funding quick scheme. Grants and events seem to be the most often touted strategies. The hard truth is that fundraising is hardest in the beginning stages. First, you don’t have the tools and skills to start. Second, you don’t usually have a donor database. These are things you have to build while needing the funding.  Fundraising is based on relationships. When you’re new, building those relationships should be your first priority. Unfortunately, it often isn’t. Here are some tips to help you begin fundraising.

Starting a nonprofit is just like starting a brand new business. It is hard work but in the end, meaningful work. Being prepared for the road ahead can make the journey less stressful and more enjoyable.

 

Join the conversation on Facebook or in the comments below by answering the following question:

What did you find the most shocking? If you’ve already started your nonprofit, which piece of advice do you wish you had known before you started?