Using donations to support your business
The question of establishing a for-profit or non-profit business is a challenge for many social entrepreneurs. However, for companies, financing is often a difficult problem to solve. However, the benefit of establishing a non-profit organization is that it makes it much easier to receive donations as a form of funding. When looking for donations, here are some tips to keep in mind: establish the purpose, develop an end goal, create a list, follow up, and keep track of documents.
set the purpose
Initially, it is very important that you set a purpose. This is the first step in determining where your organization is headed. Funders will want to know what your organization stands for. There should be a culture plan and business plan in place that outlines where potential funds will go. It is not always necessary to reinvent the wheel. Many organizations have culture plans that can be modeled to fit your organization’s goals. One question to ask yourself is: What are we trying to do here?
Develop an end goal
It must be very clear before requesting donated funds or supplies, how the funds or other resources will be allocated. Also, the organization must know how much money or other resources it should get from donations. This will set clear expectations for whoever leads this initiative. One question to ask yourself is: How many resources do I need for a given project or for my operations?
Create a list of potential sponsors
After learning about the resources your organization is looking for, create a list of potential sponsors who can help you reach your goal or who can donate to your organization. One can see if the potential sponsor has donated similar funds in the past or if the potential sponsor has materials that could benefit your organization in reaching its goal. One question to ask yourself is: Which companies align with my organization’s mission or projected goal?
Tracking Potential Sponsors
Once potential backers have been identified and contacted, it is important to track interest to secure a donation. Organizational leaders are often quite busy and need to be persistent in seeking funding. One question to ask yourself is: Is this potential sponsor still interested in supporting our goal?
Document tracking for liability
Whoever leads giving efforts needs to keep track of the organizations and what they are giving. By donating to 501c3-recognized nonprofits, organizations can earn tax benefits. Consequently, organizations that receive donated resources must document what they receive for tax purposes. Additionally, this will help create projections for other funding targets in the future.
Synopsis
Seeking funding is a vital goal for start-up nonprofits. Fundraising can often be a challenge for stakeholders in general. When considering fundraising, there are several things to consider. It’s important for business leaders to remember to set a purpose, develop an end goal, create a list of potential sponsors, follow up with potential sponsors, and do thorough document tracking. This will lead to fundraising success.
