So you’re interested in starting a nonprofit. You are not alone. The number of nonprofits has risen dramatically in the U.S. over the past decade. In fact, the nonprofit sector is growing faster than the for-profit one.  

This brings us to the first thing you must know before starting a nonprofit:


Is There a Need for Your New Nonprofit?

For your new nonprofit organization to be viable, it must provide real value. There has to be a need that it will meet, that no other group is fulfilling. Also, you need to know if your nonprofit will be able to continue to meet that need, go on providing value, over time.

This means the first thing you have to do before starting a new nonprofit is research, research, research. Find out what other organizations are similar to the one you have in mind. Dig for data that proves your nonprofit idea will contribute significantly to solve an ongoing, unmet need or problem.

If your new nonprofit doesn’t provide real value, no one will support it or attend your events and it will likely fail. But if it fills an in-demand niche, your chances of creating a nonprofit that will thrive are excellent.


How to Name Your New Nonprofit

You’ve researched thoroughly and discovered there is a real need for your new nonprofit idea. Great! The next thing you must know is what to name it. Like branding a company or naming a product, the most effective nonprofit names tell you something about what the organization accomplishes and are easy to remember. Think of “Teach for America,” “Doctors Without Borders,” “Mothers Against Drunk Driving,” and “The Worldwide Fund for Nature”–all these names are memorable and tell you something about what the nonprofit does.

Start out with a brainstorming session to answer: Who are you? Who does your nonprofit help? What does it do? Are there catchy words you can incorporate in the name? If you’re struggling and coming up blank, Nonprofit Ally has a great article of tips for naming your nonprofit.


Choosing Board Members for Your New Nonprofit

After you’ve named your new, much needed nonprofit, the next important consideration is the Board of Directors. You will need a board of at least three members. A nonprofit’s founding board can be crucial to its future success, and on the flipside, unmotivated board members can severely damage a nonprofit organization. Keep this in mind when interviewing and choosing candidates.

A good rule of thumb for choosing a nonprofit’s board is to have one-third people with strong fundraising resources, one-third those with management experience, and one-third people from the community who are experts in the need your nonprofit will be addressing.


How to Fund Your New Nonprofit

This is a crucial question and one that you have to answer before moving forward with your idea. There are four main sources of funds for nonprofits:

  • Membership Dues
  • Government Grants
  • Private Contributions
  • Fees for Goods and Services from the Government, if you provide public services like healthcare

Most nonprofits rely primarily on one of these sources of revenue. You will need to create a strategy for the best way to fund your new nonprofit. Perhaps one of your board members has lots of experience with grant writing so you can make grants the cornerstone of your funding. Or maybe your new nonprofit lends itself to themed events, so membership dues and ticket sales will generate revenue.


Paperwork: File Articles of Incorporation and Write Bylaws

The fifth thing you must know before starting a nonprofit is how to file your nonprofit articles of incorporation. Each state has its own paperwork for this, but they have a few things in common. Generally, you will list the nonprofit’s name, the name and address of the founder, the nonprofit’s address, the names and addresses of the board members, and your nonprofit’s statement of purpose.  

You will also have to write bylaws, which are like your organization’s owner’s manual. They include your purpose, membership rules, board guidelines, and other legal matters like potential conflicts of interest. If you don’t have a lawyer who can help you with this, Nonprofit Ally offers sample nonprofit bylaws.

Once you’ve written your bylaws and filed the nonprofit articles of incorporation, you become an official nonprofit entity. Congratulations!


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