Financial concerns plague most charitable organizations who rely on donations and gifts to operate. With nearly 1.6 million 501(c)3 nonprofits in the U.S., according to the Internal Revenue Service 2013 Data Book, competition for donations is fierce. However, thanks to the Internet, you can pursue funding avenues that attract tech-savvy cause supporters to complement grants and traditional money-raising activities.
You can raise money and solicit grants while waiting for the IRS to give your organization's nonprofit status by getting a fiscal sponsor. Investigate existing nonprofits with similar missions who can administer and accept charitable donations on your behalf. The arrangement you negotiate may require you to pay a percentage of your budget as an administration fee.
Obtaining grants from private, community or corporate foundations involves research to identify good matches between your mission and the services or programs they support. Grants can fund a specific program, a new hire or general expenses. IRS guidelines require one-third of nonprofit financial support to come from general public or government donations so a large grant could affect this percentage and jeopardize your charitable status. The Minnesota Council of Nonprofits advises keeping a mix of revenue flows to alleviate foundation concerns of dependency on one source. Once your nonprofit has a track record, consider government grants from local, state and federal agencies as potential sources of income.
Broaden your fundraising net with a money-raising tool called crowdfunding, which the Council of Nonprofits defines as soliciting donations from a diverse group of people either through a website you create or a dedicated one such as Kickstarter, or live events hosted by crowdfunding specialists such as The Funding Network. You can promote your online crowdfunding request on social media to drive Twitter and Facebook users to your site where they can view videos, photos and project details and make a donation.
Crowdfunding isn't the only way to take advantage of technology to raise money for your nonprofit. Your website can give viewers the opportunity to donate with a few clicks. You can double those donations by including information about matching gifts, with links to a list of companies that match employee gifts and online forms. Promote your cause and simplify giving for donors by setting up text fundraising, enabling them to send a text and donate an amount that will appear on their phone bill. Market your "text us dollars" campaign on social media and on all printed material you distribute.
Sponsoring an annual or semi-annual event, direct mail campaigns and selling items associated with your organization, such as clothing with your logo, are proven methods to bring dollars into your nonprofit's bank account. By increasing awareness of your cause and vision, you can make these efforts more successful. For example, identify key individuals from your organization to serve as speakers for community events and media requests, write articles that can provide content for blogs and websites, or incorporate your own blog into your website and promote it through social media.
- Internal Revenue Service: SOI Tax Stats - Tax-Exempt Organizations and Nonexempt Charitable Trusts - IRS Data Book Table 25
- Grant Space: Knowledge Base; What Is a Fiscal Sponsorship? How Do I Find a Fiscal Sponsor?
- National Council of Nonprofits: Fiscal Sponsors
- Minnesota Council of Nonprofits: Three Types of Foundations
- Minnesota Council of Nonprofits: Building a Sustainable Fundraising Mix
- Nolo: Nonprofit Fundraising Methods: An Overview
- National Council of Nonprofits: Crowdfunding for Nonprofits and Fundraising for Overhead
- Top Nonprofits: How Nonprofits Take Advantage of Matching Gifts
- Udemy.com: Non-profit Fundraising Ideas: 20 Effective Ways of Raising Funds for Charity
- John Lund/Annabelle Breakey/Blend Images/Getty Images