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How To Start A Nonprofit Organization

Updated: Aug 11, 2022

Helpful as they may be, there are several resources out there that can be overwhelming. If you're just starting out with a nonprofit, it's important to take the time to learn at your own pace and figure out what works best for you and your organization.

Gathering a Board

A board of directors is a group of people that oversees the day-to-day operations of a nonprofit. They help decide how money is spent, whether the organization should expand or scale back its activities, and what goals it should pursue.'

Why do you need a board? A well-functioning board can make all the difference in ensuring your nonprofit succeeds in achieving its mission. A good board acts as an advisory body for the executive director (ED), helping provide direction on fundraising efforts and other important decisions. A sound relationship between ED and Board members ensures that there are open lines of communication between them so both parties can work together toward common goals.

But how do you find people who are willing to volunteer their time and energy to serve on your nonprofit’s board? In order to recruit potential members for your nonprofit's new Board, start by asking staff members if they know anyone who would be interested in joining the Board at some point during its first few years as an official entity; this will be particularly helpful if one or more current employees has experience serving on boards before joining your organization's staff.

Forming Your Nonprofit

What is a nonprofit organization?

A nonprofit corporation is a legal entity that does not distribute any profits to those who are involved in its governance. It can be formed for the benefit of an individual, group or community.

What is a 501c3?

A 501(c)(3) designation means that your organization will receive tax-exempt status from the IRS and be able to accept donations from sponsors or donors without paying taxes on them. The “c” in this designation stands for “charitable”—a word with many different meanings across cultures and time periods—but generally refers to groups that have been approved by federal agencies as having an altruistic purpose. As you might expect, there are some requirements associated with obtaining charitable status: You must have been established as a non-profit organization before applying; your primary activity must benefit others (rather than yourself); there cannot be any discrimination based on race/ethnicity when making decisions related to employment opportunities; etcetera (check out our full article here).

Naming Your Nonprofit

When choosing a name for your organization, there are several things you should keep in mind.

  • Make sure it's available. If a search of the name reveals that it's already being used by another organization or business, you'll have to come up with something else.

  • Choose a name that is easy to remember. You want people to be able to remember your nonprofit's name easily so they can refer others and share information about it with friends and family members.

  • Choose a name that is easy to spell (and pronounce). It’s important for donors and volunteers alike to find the nonprofit easily on Google searches, as well as in any other database where they might look for nonprofits like yours—so make sure the spelling is simple and clear!

Writing a Mission Statement and Vision Statement

  • Write a clear, concise, inspiring mission statement.

  • Write a statement of your nonprofit's purpose that includes its core values and defines who you are as an organization. This is called the vision statement.

  • Keep both statements aligned with one another through some combination of being written in the same document or on the same page; using similar words; and referencing each other sentence by sentence.

  • Be sure the mission and vision statements are aligned with all other goals for your organization: short-term projects, long-term plans, fundraising strategies—everything!

Delegating Essential Management Tasks

Here are some of the things you need to do right away:

  • Have a plan. Develop a mission statement, as well as your organization's vision and values. Make sure they are written in clear, concise language that inspires people to give their time and money without feeling like they're being sold something. Remember, this is not only an opportunity for you to express yourself but also an opportunity for potential donors and volunteers who read the document to get excited about helping out with the cause too!

  • Define roles and responsibilities. Decide how you will organize yourself internally by creating job descriptions for all employees (and volunteers). This includes positions such as executive director, accountant/bookkeeper/financial manager or fundraising coordinator—as well as any others that may be necessary based on what your nonprofit does day-to-day operations.

Establishing a Fundraising Plan

Before you begin, think about how to structure your fundraising efforts.

While it's a good idea to keep your overall financial goals in mind, when it comes to fundraising plans, remember that donors are the lifeblood of your organization. Donors are critical for the success of your organization; they're the people who give money and other resources to help you reach those goals. Your fundraising plan should reflect that reality—and make sure that there's plenty of room for donors' input!

The first step is assessing what kind of approach has worked best for other nonprofits similar in size and mission as yours (or even just one) in terms of bringing in funds from individual donors and larger organizations like corporations or foundations. One way we did this at [organization name redacted] was by looking into other organizations' annual reports; every nonprofit has one (you can find ours here).

Start your nonprofit!

Congratulations! After all that work, you are ready to start your nonprofit. Although the process can seem daunting at first, it's actually pretty easy and straightforward once you get started. Start by forming a board of directors—this is best accomplished by having two or three people come together as co-founders. (If you want to incorporate your organization, which is highly recommended and legally required in most states, then make sure there's at least one other person involved who knows about business law.)

Next up: legal advice! Your board should consult with an attorney to ensure all of their documents are written correctly and comply with state laws. They may need help setting up a nonprofit corporation—or even applying for 501c3 status if they plan on raising funds from government grants or donations from individuals who earn over $200k per year (these rules vary from state to state).

Once everything is sorted out with legal stuff (and hopefully sooner than later), it's time for some visioning! Visioning involves creating long-term plans for what your organization hopes to accomplish in its lifetime—it's kind of like writing down what success looks like before starting anything big. Once again, this should take place during the planning stages so that everyone knows how they're going towards making those dreams come true in the future.

Now comes one of those things we were talking about earlier: delegation! In order for any organization (especially nonprofits) operate smoothly every day after launch day has ended until forevermore because humans cannot live forever but I am sure there will be other teams besides ours doing great things too., someone needs delegate essential management tasks among staff members so they can focus on bigger picture issues rather than micromanaging each individual employee every day because that would just be crazy.

Time To Get To Work

Now that you have learned about the process of starting a nonprofit, it is time to get started! Make sure that you join the 9to5 Founder Community so we can support you on the journey.

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