How can a non-profit organisation get money to sustain itself

June 17, 2015 4:12 PM

So the issue is this: I would like some ideas about how an organisation helping children by educating them, making them do sports, etc. can obtain money for the electricity, food, maintenance.

I would like very concrete, practical answers, not just "borrow money", which, by the way, will have to be repaid later on. I am sure other non-profit organisations have been in the same situation before so any thoughts or links to good resource is welcome.

posted by iliketothinknu to Work & Money (11 answers total)

Well, through fundraising. No organisations can operate without funds; almost all non-profits fundraise through donation appeals, street and POS collections, events, commercial enterprise or grant writing.
posted by DarlingBri at 4:19 PM on June 17, 2015 [6 favorites]

Best answer: Depending on where you are located, people who donate money to your organization may get tax breaks for doing so. You find those people (who share your concerns) and convince them to donate money so that your organization can do those things.

Or you apply for government or private grants to do so.

Or the organization does something that brings in money, so that they can also do things that cost them money.
posted by BillMcMurdo at 4:19 PM on June 17, 2015 [1 favorite]

… grants and donors.

Any non-profit organization needs to think about its funding stream as a foundational part of incorporating. Every business, actually.

As you've written it, you're not going to get concrete, practical answers because you've asked a question that is wildly overbroad with basically zero information that would allow anyone to give you specific advice.
posted by klangklangston at 4:21 PM on June 17, 2015 [12 favorites]

Another term you might want to search on is development. Idealist.org has a very basic 101 on fundraising methods and strategies with links to more resources.
posted by Wretch729 at 4:25 PM on June 17, 2015 [4 favorites]

Best answer: Beyond the answers above, the other common answer is "charge the families of the children" for services. Private schools, sports programs, camps, whatever, typically charge fees that cover at least some of the cost of providing their services the same way that museums charge admission fees that cover some of their operating costs. The programs can then can offer whole or partial subsidies to families that can't afford those fees. The funds for these subsidies generally come from donations, grants, and endowments as discussed by others here. This is basically the business model of most private schools for instance.

Charging fees means that you collect money from the families that can afford to pay and you have a stable base of revenue that covers some of your costs, rather than being entirely dependent on donations and grants.

Now, some organizations that work with kids don't charge any fees, generally those that focus primarily on serving families that won't be able to afford them. They depend entirely on other revenue streams for funding.
posted by zachlipton at 4:34 PM on June 17, 2015 [2 favorites]

You're talking about overhead cost. It is built into most grants.
posted by k8t at 5:25 PM on June 17, 2015

Best answer: The only thing I can think to add to the obvious donations, grants, and charging fees for services is that you could also try to get one stream of profit to pay for other things you want to provide subsidized, or that you just want to use to pay for the organization to operate. For example, I help to run a nonprofit organization and we charge a fee to interns to participate in a high quality internship program that helps people gain experience in the field. We use the money from the internship program fees to defray the costs of our activities serving our target communities. There are plenty of other ways that you can try to use whatever resources your organization has to create some sort of marketable service or good that you can sell. For example if the kids made crafts that you could sell, or if you could charge for some sort of sports tournament thing, or something along those lines. But you need to really think it through to ensure you're offering something that people will want to pay for and that the amount of work you'll put into marketing it will be justified by the potential for profit.
posted by treehorn+bunny at 6:09 PM on June 17, 2015

Best answer: If you don't like asking people for money face to face, you could open a shop but it might take longer or the same amount of time to raise money. I work with some charitable groups that are constitutionally barred from asking for donations and can no longer get grants. They have shops and tender for contracts. Truth is, it's an uncertain time to be a charity. You could be better off just working or having your own business and donating money. That said, it is ironically less expensive for a business to give money to charity anonymously than it is to be the headline sponsor. That is because of taxes on marketing activities.

In 2011, I worked with a group of non-profits who were only allowed to raise a portion of income from one activity, which made it very hard to compete. A lot of those founders regretted ever becoming involved, though they all said they were touched by little kindnesses one way or another. One said it was his life's work, and he was going to use his own money to keep it going.

I urge you to think before you leap. You may be better at being concerned, better at empathy, at care than you are to be a charity leader or founder. It is a very difficult role and happy endings are extremely rare.

I train fundraising personnel for charities. I know those I teach are especially loyal to their organisations because I train them that way. You may find a mentor who can help you learn to raise money. Hope your portfolio is not too large, your annual goal not too big, your budget good, and you can train your own replacement. You must remember that if you raise money eventually you will not be known for anything else and that fact can break a lot of hearts, including your own.
posted by parmanparman at 8:47 AM on June 18, 2015 [1 favorite]

yeah, what people have said.. but perhaps I can address what might be an incorrect built in assuption hinted at here?

Nonprofit does not mean you can't charge for services, it just (simplified) means you are not aiming to make a profit above and beyond expenses related to your business, which includes saleries.
posted by edgeways at 8:59 AM on June 18, 2015 [2 favorites]

There are lots of books on fundraising. Get thee to a library and read at least one. A point I recall from one I read: You will need to learn to ask for the big bucks. Bake sales will not really cover it.

Good luck.
posted by Michele in California at 12:06 PM on June 18, 2015

Honestly, do not focus on being able to raise money. That is the easiest job in the world. Just focus on one thing, which is actually a science and pertains to all jobs much more: Estimating the cost of your time to do the work you love and supplies needed to do it. Seriously, go after procuring like a thief and create a stunning quote system. You can be a god if you can procure with excellence. Great estimating and procurement matter more for quality than fundraising.
posted by parmanparman at 3:11 PM on June 18, 2015