6.03.2017

How To Successfully Create a Non-Profit



Starting a Charitable Non-Profit Organization? 


Some Considerations

By Tim Lucey



First, we are talking about a non-profit organization under IRS code 501(c) 3. For a basic understanding of what that means see irs.gov.

Do you have a driving passion for your cause and a love for those who will benefit from your good work? If so, I welcome you to the joyous and rewarding world of philanthropic work and wish you well as you pursue your dreams. Let’s get started!

Here are some topics you will need to consider as you embark on your mission. You will want to have a solid understanding of these, hire specialists or have committed people on your team who can fill the gaps in your knowledge.

1. What is your mission? What are your purpose and objectives? Are you meeting a need in a unique way? How is this different or better than what someone else is doing now? 
2. Your commitment: Are you ready to work day and night in the face of failure, rejection, roadblocks and disappointment to fulfill your mission? 
3. Time horizon and your role: Do you want this effort to continue after you are gone? Are you prepared to turn control over to the board? They, not you, will have legal control of the organization.
4. Is someone else doing the same thing? Before you embark on starting your own non-profit organization or corporation consider alternatives such as collaborating, teaming with or operating under the umbrella of another non-profit organization with a similar or compatible mission. Find a local non-profit support agency such as Non-Profit Management Solutions (NMS) or San Diego Non-profit Association (SDNA). Both offer workshops and resources that are affordable and informative. And they are the perfect place to meet great people like you.  
5. Do you have a business plan? A strategic plan? Your prospective board members and funders will want to see one.
6. What is your story? You will need a good one and you must become good at telling it. For most of us this is an acquired skill so start telling it. “My dream is…”
7. Budget: Create one and follow it frugally.


8. Cash requirements: Know your costs and the cash flow required for sustained operations. Plan for a reserve to deal with emergent requirements and hard times.
9. Funding: Are you good at asking for help? Do you understand how to identify funders? Do you know the information required and have the skills needed to write a winning grant request? Did you know that many funders will not consider your funding request unless you have been operating for 3 or more years? 
10. Web presence: Who will design, build and maintain your web site?
11. Social media: Who will manage, monitor and maintain your social media campaigns and engagements? 
12. Communications: How will you plan, write and distribute your annual appeal letters, newsletter, announcements and press releases?
13. Cyber security? How will you protect your organization, your stakeholders and your supporters from hackers and thieves?
14. Donor management: How will you document, track, acknowledge and report your cash and in-kind donations?
15. Event management: How will you plan, fund and staff your events? 
16. Meeting management: Where will you conduct your meetings? How will you control and document them? Nothing kills the spirit of volunteers like a poorly run meeting.
17. Board development: Do you know the skills and experience needed to fulfill the board duties of governance, oversight and fiduciary? Have you served on a non-profit or have people willing to serve on your board who have? You will want at least one person on your board who has been involved in a non-profit start-up or a successful turn-around of a failing non-profit organization. 

18. Volunteers: How will you attract, engage, recruit and train your volunteers? Consider different levels and types of volunteers. Some volunteers may be needed to support your mission while others may support/advise on board related matters such as events, legal matters, IT , newsletter etc. How will you screen and vet them? How will you communicate with them and keep them informed and interested after they say yes?
19. Staff: Will you need employees? If so, you will find good use for that MBA.
20. Legal: Is your brother-in-law an attorney with a heart of gold? If not, be prepared to pay for good legal advice on a wide variety of matters.
21. Insurance: You will need insurance to protect yourself, your stakeholders and your volunteers.
22. Forming a corporation: Do you understand the advantages and disadvantages of incorporation? 
23. Non-profit status: Do you know how to acquire and maintain your non-profit status? Do you know how to fill out form 990? Are you familiar with the IRS policy guidelines and which ones are required for your organization? For instance you may need to have a conflict of interest policy but a whistle blower policy might be overkill.
24. Bookkeeping: Do you need an accountant? Are you prepared to keep accurate records for timely and accurate reporting? Did you know that some funders as well as some government programs require audited financials before they will consider your funding request? 
25. Plant, facilities, offices and equipment: Where will you operate? There are many non-profits that have operated for years out of a spare bedroom or garage. Most of them are dying or already dead. 
However, a virtual office could be a great solution for you if you are willing to invest in and learn how to use some of the low-cost sharing and collaboration tools out there like Drop Box, Basecamp, Skype and others. Salesforce.com for instance is offered free to non-profits. It is a great and powerful tool but it is free like a puppy is free.


If after reading this list I formulated off the top of my head you still want to pursue your dream, I say, "Do your homework, roll up your sleeves and jump in with both feet. The water is fine! Good luck."