Getting off on the right foot
The startup stage of a not-for-profit

Nonprofit organizations go through many stages: initial startup, growth, and various points and fluctuations that occur throughout the life of a fully operational organization.

Although each stage poses challenges, startup is often the most difficult to navigate. Let’s explore some of the key components.

People

People are the key to success. A startup nonprofit needs to find three groups of people to form its support system:

1. Board members who are willing to spend the extra time needed to get the not-for-profit up and running,

2. Staff members who are committed to an “in process” organization, and

3. Volunteers who are willing to donate their time to a new organization.

The intricacies of starting and growing a nonprofit are many, so look for board members who have a variety of experience. For example, individuals who work in fields related to the organization’s purpose — such as doctors on the board of a medically related nonprofit — can offer great insight. Individuals who have served on boards of other organizations have their past experiences to guide them, and lawyers and CPAs can help with some of the legal and financial issues that will arise.

Board members and founders also should be the cheerleaders, working with staff to make them feel proud of the organization and conveying the importance of the not-for-profit’s mission.

To find impassioned volunteers, go to those your organization will benefit most. For example, a nonprofit whose mission is to educate low-income people in proper nutrition might look to nurses and nutritionists or to single mothers on welfare. People who sense the importance of the organization will likely be willing to volunteer to help it succeed.

Organization, accounting and compliance

It’s critical to develop the nonprofit’s procedures and structure right off the bat. That includes writing the articles of incorporation or bylaws and developing a strategic plan.

Designate a knowledgeable individual to be responsible for the accounting functions. Accounting software for small businesses, such as QuickBooks or Peachtree, are sufficient to handle the initial required accounting until the nonprofit grows.

Most important, don’t even think about soliciting donations until you have filed the forms needed to qualify as a nonprofit organization. IRS Form 1023, “Application for Recognition of Exemption Under Section 501(c)(3),” must be filed to receive the determination letter that ensures the nonprofit’s tax-exempt status. Designate someone, whether it’s a board member or the person who handles the accounting function, to file the form and keep current with any state or local requirements.

Fundraising and publicity

Fundraising and publicity go hand-in-hand for a startup nonprofit. Fundraising is essential in order for any nonprofit, even a well-established one, to survive. And no one is going to donate to an organization that they’ve never heard of. Prospective donors need to know what the organization does and what its purpose is.

Because fundraising is difficult in startup nonprofits, publicity is often the “make or break” factor. Therefore, developing a public relations campaign should be one of your top priorities during the startup stage. And consider recruiting a qualified marketing and public relations professional to sit on your board.

But before publicizing the nonprofit’s mission, make sure the organization is ready. You wouldn’t interview for your dream job clothed only in your pajamas. Likewise, you shouldn’t publicize a nonprofit that isn’t yet well organized, because it won’t look good to outsiders.

Keep the enthusiasm going

Newly formed nonprofits typically aren’t well-oiled machines that will run themselves. Although there will be many issues to contend with, one of the most important things you must remember is to not lose your vision and enthusiasm. Keeping your chin up can help you get through. And once you’ve overcome the inevitable bumps in the road, you can look forward to watching your startup become a fully operational gift to your community. •