Most nonprofit organizations begin with the goal of addressing a social or community issue or need that has personal meaning to the activists involved. Nonprofits can be charitable organizations such as homeless shelters, educational institutions such as museums and youth centers, and religious organizations. The mission of a nonprofit is to work for the public good, and this often means it’s necessary to keep costs down. Thankfully, there are plenty of cost-saving benefits and tax exemptions that nonprofit organizations can take advantage of.

Take the first steps toward starting a nonprofit.


The first step towards starting a nonprofit organization is to register the organization in the state where you plan to incorporate. You can find information about filing requirements through the National Association of State Charity Officials and the U.S. Small Business Administration. Once you register a nonprofit, you need to submit a formal request to the IRS to recognize you as a 501(c)(3) organization for tax exemption eligibility. Nonprofits will also need to file a Return of Organization Exempt from Income Tax Form 990 with the IRS. It’s a good idea to work with an attorney or tax specialist who can help complete and file applications.

Know how to raise money and generate revenue.


The mission of a nonprofit is the focus that drives the organization. Being classified as a nonprofit is a tax status, it doesn’t refer to your financial situation. Effective nonprofits rely on fundraising and budgeting to operate, and on staff, marketing, communications, technology, and program delivery to achieve the mission.

Nonprofits also have the unique ability to offer a free service to the community but sell the same service to paying companies. As such, these organizations need to be smart about generating revenue while giving back to the community. Any business, whether a private or a social enterprise, needs to help meet a need while being financially sustainable.

The key to successful fundraising is relationship building. When you have the right tools at your disposal to spread your marketing messages you can more effectively reach donors. Engaging Networks is a customizable, innovative software platform for nonprofits that can either replace or integrate with advocacy, fundraising, email, P2P events, and data management systems.

Their fundraising tools include templates and filters that help you build engaging donation pages. The Engaging Networks platform features built-in email templates that automatically populate supporter data such as contact information and email addresses so that you can automate your email marketing campaign. The platform even features an online store function where you can spread your organization’s kind words on branded merchandise.

Run your nonprofit like a startup business.


The smart way to operate a successful nonprofit organization is to run it like a startup. Perform market research to uncover and understand the unique needs of your target market. Create a minimum viable product, or MVP, and continue to test and refine it until you arrive at the right product-market fit. Once your nonprofit arrives at a fitting MVP, pitch it to the target foundations and corporations whose problems or concerns can benefit from your offering. Nonprofits can benefit from using data to make better business decisions. Everything from measuring social impact, performance management, and financial data can increase efficiency and guide decision-making processes.

Create a profitable mission.


Running a nonprofit organization puts you in the unique position of giving opportunities to those facing barriers to employment. Creating a profitable mission ensures the long-term sustainability of your organization and reduces dependency on philanthropy. The more profitable your mission, the easier it will be to reach the bottom line and generate more resources that can be invested in member needs. Running your nonprofit like a startup helps you identify and keep up with competitors, adopt business best practices, position yourself for transparency, and optimize opportunities.

For example, community habilitation services are person-centered opportunities to build a unique set of skills by participating in community activities. Building a person’s community integration and independence helps build self-esteem and social skills. Lifestyles for the Disabled is an organization that provides a community habilitation program for adults with developmental disabilities. Disabled adults who participate in opportunities such as food shopping, money management, and leisure activities will be prepared for community inclusion and independent living.

Running a nonprofit organization is similar to running a startup business. NPOs rely on fundraising and charitable donations to operate. This creates the need for a profitable mission that will raise money and generate revenue that can be invested in community members.