Nonprofits, just like their for-profit partners, require funds to continue operations.
How do nonprofits raise money to fund their operations? If they are competitive and progressive in the nonprofit sector, they have a variety of funding resources that are evaluated and prioritized annually.
Resources
According to the June, 2009 news release from the Giving USA Foundation, charitable giving in the United States exceeded $300 billion for the second year in a row in 2008. Donations to charitable causes in the United States reached an estimated $307.65 billion in 2008, a 2 percent drop in current dollars over 2007. The 2008 number is the first decline in giving in current dollars since 1987.
Federal, State and Local Governments - typically through grant applications in the areas of social services and healthcare
Public and Private Foundations - grant applications
Community/Family Foundations - relationships and grant applications
Corporations - relationships and grant applications
Federated Funds - i.e. United Way - grant applications
Special Events - donor support through dinners, walks, auctions, etc.
Annual Fund - annual (or more frequent) appeal to community members
Membership Campaign - annual appeal to community members
Capital Campaign - usually a multi-year campaign to raise funds for capital projects or a specific project/event
Faith Community - individual or group donor support through funds or in-kind investment
Product/Services Revenue - sales of services, items, products
Planned Giving - often a large donation at the time of death or an immediate large gift
Endowment Income - funds that produce interest that is used to support the organization
Each resource has its advantages and disadvantages to the organization in terms of cost effectiveness, record keeping, accessability, risk, process, guidelines, requirements for board involvement , mission focus and requirements for donor investment.
To be successful, a nonprofit must be positioned accurately, particularly for the fundraising effort. The organization will benefit by knowing its own strengths and weaknesses.
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