7 Tips for Starting a Nonprofit Business for Entrepreneurs

Starting a nonprofit business is a wonderful way to serve your community, but if you don’t have a heavy background in nonprofits, you probably have no idea where to begin.

Even if you have the best intentions, if you’re stuck at the starting line, you won’t ever be able to really provide the help that you want to offer to the world. You might need some guidance. This isn’t easy!

If you’ve never done something like this before, that’s totally okay. Keep reading for just a few tips on how to get started with organizing your nonprofit business so you can help your community.

  1. Pick Your Cause Carefully

Picking a social cause for your nonprofit is the first step, but it’s not as easy as you’d think.

It’s not uncommon for people to go into the world of nonprofits just knowing that they want to help in some way but without any clear view of exactly how they want to help.

You need to spend a bit of time either alone or with your team brainstorming to figure out what causes you’re actually passionate about. If this is going to be a real long-term project, you’re going to need to be in it for the long run. You need to pick a cause that you can commit to. Make sure that it’s something that counts and that you really care deeply about.

It’s also important that you don’t pick anything too trendy. There are waves of issues that come and go but get dropped and forgotten quickly, not because they don’t matter, but because they’re actually part of a greater social issue. Make sure that the thing that you’re choosing has a wide enough scope for you to follow through with.

  1. Put in Research Time

You probably want to dive in headfirst to your nonprofit business, but research is an essential step to this process.

Whatever nonprofit you plan on starting, you need to really dig deep into it to figure out exactly what it is that you plan on doing. It’s best to be as specific as possible. While you want to have a wide scope, it’s okay to pick a specific niche to focus on so long as there’s enough to work with within it.

While you’re doing this research, try running your ideas through a directory for nonprofits to see if they’ve already been taken. While it’s okay for more than one nonprofit business to exist for a cause, consider whether or not your efforts would be best served creating another nonprofit for this same topic, creating a different one, or volunteering for or working alongside this preexisting nonprofit instead.

  1. Make a Business Plan

Even though this isn’t a conventional business, you’re still going to need some kind of business plan.

A business plan is going to be what helps you get money from donors for your cause. This is essential.

There are several different ways to write a business plan, and they won’t all look the same. You are going to have to put some consideration into your marketing strategies, your cause, and your mission statement before you put pen to paper. These are the things that will help convince people that they should offer you their funds.

  1. Go Tax-Exempt

You’re going to want to incorporate your nonprofit. A lot of this process will be similar to the general process of your business plan. You need to find a name, choose a board of directors, figure out a legal structure, get all necessary licenses, and file some paperwork.

When you’ve done these things, you can apply for tax-exempt status.

Being tax-exempt is important for a nonprofit organization to enable you to allocate all of your funds where they can be best used. It’s best to do this as early as you’re able.

  1. Compliance is Essential

Remaining compliant with your business might be a little bit confusing, especially if this is your first nonprofit organization.

It might be in your best interest to hire an accountant or a treasurer to keep everyone up to date on the nonprofit accounting basics. Having someone there to control the money will make everything a lot easier when tax season rolls around.

  1. Plan Your Fundraising

Having a fundraising plan is important when you’re developing your business plan, but it will be ever-changing. This is part of your marketing efforts. How are you going to make money for your nonprofit?

It’s important for you to set goals and landmarks for your nonprofit to see if you’re achieving what you aimed to achieve when you got started. This will help you readjust as time goes on. Without a plan, it’s harder to tell if your fundraising efforts are working as well as you want them too.

  1. Hire the Right Staff

Depending on your fundraising intentions, your staff is going to vary. If you’re going to have a heavy focus on in-person fundraising, for example, you might be looking at an experienced events coordinator. If you’re looking for more online work, you’re looking for social media marketers.

You’re going to want artists and writers, as well as people with backgrounds in sales. While you’re not “selling” anything, you are trying to get people to offer you their hard-earned money. You need someone who knows how to sell an idea.

The right staff can make or break your nonprofit efforts. Don’t take this too lightly.

Your Nonprofit Business is on the Horizon

Starting a nonprofit business isn’t easy, but if you’re committed to a cause, it’s definitely within your reach.

If you want to help your community in a tangible way, a nonprofit might just be the perfect way for you to get involved.

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About RJ Frometa

Head Honcho, Editor in Chief and writer here on VENTS. I don't like walking on the beach, but I love playing the guitar and geeking out about music. I am also a movie maniac and 6 hours sleeper.

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