It is important for non profit organizations, both those just starting out and those which are well established, to have a diversified stream of income. By diversifying where your revenue is coming from, your non profit organization will be less dependent on each revenue source. The more diverse your organization is the better it will be able to withstand changes in funding.

Grants, for example, are a great way for non profit organizations to generate the revenue which they need to operate. However, if an organization is relying too heavily on grants and their grant funding gets pulled or reduced, the organization may struggle trying to make up for that loss of funding in other ways. It is better to be prepared by having additional fundraising initiatives, and soliciting donations in addition to applying for grants.

The need for multiple sources of funding has become even more important with the recent decline in the American economy. As bank accounts continue to shrink; individuals, organizations and foundations are becoming more selective over which organizations they are making contributions to. This is creating more competition between organizations for the resources available. The organizations which are best equipped to deal with this competition are those which are the most diverse in their revenue sources and the least reliant on one single source.

Organizations should look at fundraising efforts also as a way of marketing and getting your name out into the community in addition to means of generating revenue for your organization. Fundraising events, while they may not always create a large amount of income for an organization, cannot always be measured by the amount of money they generate at that event. This is due to the possibility of future donations and contributions based on the relationship which may have been established at one of these events. Additionally, hiring a professional fundraiser can be a smart move for event the youngest of non profit organizations.  Not only does a professional fundraiser have experience working a variety of different events, a professional fundraiser knows how to make connections and secure sponsorships.

Even non profit organizations which have been successful over a period of time using one revenue source should consider working to find new untapped sources of income. This will strengthen any organization and all organizations will welcome more income; as more income allows the organization more freedom in working towards accomplishing their mission and fulfilling their goal.

Want to learn more about the do’s and don’t of fundraising effectively? Check out CharityNet USA’s short video “The 8 Truths of Fundraising” .

Have you ever dreamed of spreading your mission & helping others? You’re not alone!  Many people find themselves interested in starting their own non profit but are unsure where to begin.

Starting a non profit can be fulfilling and rewarding but requires a great deal of preparation.  There are many important decisions to make and many rules and procedures that must be addressed to build a solid foundation for growth.  Additionally, if your organization is interested in filing for the coveted 501c3 status, there are specific items that must be addressed before hand.

We invite you to spend some invaluable time with CharityNet USA and get familiar with the ABC’s that will help you plan, prepare, and manage your non profit organization.

Topics of Interest:

• Bylaws
• Articles of Incorporation
• Board Development
• Conflict’s of Interest

Learn how to prepare your non profit organization for success by attending either our seminar or webinar!

The event will take place on Thursday, April 15, 2010.

For all of you Florida residents near the Orlando area, a seminar will be hosted in our office from 10:00 a.m. – 11:30 a.m.  Our office is located at 2151 Consulate Dr. suite 5, Orlando, FL 32837

For the rest of you out there, we have a webinar version available that will run from 3:00 p.m. – 4:00 p.m. (EST)

If you want your nonprofit organization to be successful, you need to keep in the mind the rules of fundraising. The previous blog, Fundraising part 1, left off with the fourth rule: marketing. There are marketing services out there that can be pretty expensive, but don’t let that get you down.  There are other ways to help build awareness to your nonprofit organization while keeping the costs down.

First and foremost, utilize social networking media such as MySpace, Facebook, Twitter, etc. to publicize your event. These sites are free and millions of people use these on a daily basis. Another marketing tip is create a flyer utilizing a word processing software and print about a thousand to hand out to the local area. These do not have to be fancy color printed flyers. You can be as simple as black and white print on a colorful piece of paper. Do not forget to tell people that you are going to be conducting a fundraiser because word of mouth can help your marketing efforts exponentially.

The truth is, fundraising can be as simple or as complicated as you want to make it. Take a typical dinner event, whether it be a spaghetti dinner or a chicken barbeque. Most often you can get food donated or offered at a discounted rate by local area grocery stores and supermarkets. This is especially true when it comes to a spaghetti dinner because most of the food and beverage items it takes to put on this fundraiser are really cheap. Often you can get paper items such as plates, cups, napkins, silverware, etc. donated for the actual event. As for a facility, usually most towns have a local community center, park, or even a church which will let you utilize their facility for free or for a small donation. The biggest thing to know is you will have to conduct some legwork and ask around for these donations for the event. Ask the local store manager or of your supermarket if they are giving donations for charitable events. If they aren’t, thank him or her for their information but do not forget to ask about any discounts they may offer. Remember: anything you can get donated or discounted increases the profits of your fundraiser. Utilize volunteers from the organization to cook items and serve the food.

Honestly, the biggest fundraising tip or rule that I can give you is to ask for donations when conducting your fundraisers. What is the worse that is going to happen to you? They say “no, we can’t afford to do that right now”? What have you lost by asking? I’m going to go out on a limb here and say nothing. However, if they say yes, then you and your event have gained some or maybe even all of the items you need. Many organizations like to give to causes but do not have the financial means; however, they are able to give in-kind donations or items which you can utilize to conduct your event. The long and short of it is that fundraising can be very rewarding for any nonprofit organization. As long as you and the organization you are representing are willing to put some effort into it, you can help grow through fun and effective fundraising!

Many new nonprofit organizations go through the internal battle of whether or not they should participate in fundraising. Fundraising can be a wonderful tool in the arsenal of a newly formed nonprofit organization and even in a nonprofit organization which has already been established. For example, every year around January you hear the ding dong of your doorbell announcing the arrival of the Girl Scouts heralding their annual cookie fundraising drive. Honestly, I know that $3.00 is a lot for a box of Thin Mints, but a portion of the proceeds goes to help the local Girl Scouts in my community so I feel justified in paying a little bit more than I normally would for cookies. Fundraising can be an ideal way to raise funds because people feel as if they are getting “something” (whether it be cookies, a car wash, a snack, t-shirt, etc. It is a sad state of current affairs that most people do not give to legitimate causes because of the good feeling it gives them anymore. Most people expect something in return for their “gift.” Fundraising is just the ticket because both parties feel as if they are benefiting from the arrangement.

There are a few simple rules when it comes to fundraising for an organization. The first rule in fundraising is to BE REALISTIC! Plan an event that fits the current funds which the organization has. In other words, don’t plan a huge annual fundraising gala where there is a sit down meal and attendees have to pay $500 a plate if you do not have the money to rent the facility, pay for the food expenses, pay for entertainment, etc. Work within your means.

The second rule and what I believe to be the most important of fundraising is to HAVE SOMEONE WHO IS COMPLETELY AND UTTERLY DEDICATED TO THE SUCCESS OF THE FUNDRAISER. Does this mean you need to hire a professional fundraiser? Not necessarily. It is entirely possible to put together a fundraiser without professional help; however, you do need to have someone dedicated to the success of the fundraiser, whether this person is a board member or a volunteer of the organization. It’s entirely up to you.

The third rule of fundraising is to SET A GOAL. This will help clarify the purpose of your fundraiser and will assist you in realizing how many items you need to sell to reach your goal.

The fourth rule of fundraising is MARKET, MARKET, MARKET! I cannot stress this rule enough because if no one knows about your event, how are they going to attend? These days marketing costs can sky rocket your expenses, however, there are ways to keep these costs down and help achieve your goal: raising money for your organization.

Keep an eye out for the rest of the rules of fundraising… Part 2 will be posted in a few days!  In the meantime, feel free to share some of your nonprofit fundraising ideas and the steps you follow to ensure they are a success.

Dictionary.com defines Success as the favorable or prosperous termination of attempts or endeavors. To become successful in life, one must have a plan of action. In order for a nonprofit to be successful, the organization must also have a plan. Most commonly, nonprofits refer to what is called Strategic Planning.

A Strategic Plan is a management tool that is used to guide a nonprofit organization to its goal. An effective strategic plan will include specific goals and format a plan including; the steps, actions, resources, and funding you will need to achieve those goals. Most of the time, the strategic plan’s focus will be on the organization as whole, rather than a specific product or service, as with a Business Plan.

Strategic Planning serves several purposes to operating a successful nonprofit. The strategic plan will place focus on the more important issues and goals of the organization, it will help ensure proper use of resources (time management, financial resources, individuals’ talents), will highlight the company’s strengths and weaknesses and show where improvement may be needed. A strategic plan will also give a sense of security and structure to show where the organization currently is and that there is a plan in place to get the organization where it needs to be. As times, needs, and some goals may change, so should your strategic plan in order to keep up-to-date with the latest and most accurate information pertaining to your organization’s mission and goal.

So when is it time to start preparing a strategic plan? There are several times when it is appropriate to construct a Strategic Plan or revise your initial/current plan. It is never too late to implement a plan for your nonprofit. Initially, strategic planning should be done when an organization is just getting started. As a new organization, you will need to outline your plan of action to success. Your plan should be revised every 2-4 years in order to keep it accurate.

While there are times when strategic planning is appropriate, there are also times strategic planning should be avoided, or perhaps postponed. While it is always beneficial to have a strategic plan in place, there are valid circumstances where the draft of a plan should be cancelled or postponed. Any kind of “trauma” within your nonprofit would be a legitimate reason to postpone this process. “Trauma” may include the loss of an executive or influential board member or worsening financial difficulties. You shouldn’t begin preparing a strategic plan if there is no chance or possibility of the plan being executed, or “put to work”.  If your key people are unwilling to commit time and effort to achieving your nonprofit’s goals, then a strategic plan would be pointless.

However, if you are like many, you have a strong Board of Directors, or team of people behind you and who are on board with your operations and are willing to provide the support and effort necessary to accomplish the goals outlined in your Strategic Plan.

Don’t get confused…Strategic Planning is NOT a plan devised to make future decisions. Strategic planning may anticipate future circumstances but the final decisions are to be made when and if the occasion actually arises. Your nonprofit organization should continuously remain “open-minded” to new situations, circumstances, and occurrences. Some of these new uprisings will benefit your organization. Change is not always a bad thing. Keep an open mind with the purpose of making the best possible decision to further benefit and grow your organization. Strategic planning is not a substitute for leadership.

Has your organization prepared a strategic plan for success? How has your nonprofit benefited?

The Cyber-Assistant will do good things for first-time 501(c)(3) applicants but will it do enough to justify waiting to submit your 1023 application?

In 2003, the IRS started a review and revision process of how they examined applications for 501(c)(3) tax exempt status. They called this process, “Project ASPIRE,” and was created in response to the large increase in 1023 applications. At that point, the number of exempt applications was increasing by over 40% while the number of IRS Exempt Organization employees was remaining the same. The goal of Project Aspire was to find ways to streamline the 1023 application process, both for the applicant and the IRS. Following the project the IRS made some good strides, most notably, the elimination of Form 8734 (Advance Ruling Period). However, the major recommendation of this project was to continue previous efforts to develop a fully interactive filing for the 1023 application, termed the “Cyber-Assistant.”

One of the major changes in submitting your 1023 application through the Cyber-Assistant will be the stated decrease in the filing fee ($200 regardless of previous or projected revenue). It also may cut down on paper; however, since the last report, the application would still be printed and then mailed to the IRS. 

For as much flak as the IRS takes, I must say that they are doing the right thing here. After all, that 2003 project that was mentioned earlier, Project ASPIRE, stands for:

Alleviate any application backlog

Streamline the determinations process

Prioritize application review

Improve customer service

Redirect resources to cases deserving enhanced review and compliance

Enhance quality control 

But while all of this is good, is it really beneficial to wait for the Cyber Assistant to apply for your 501(c)(3) tax exempt status? After all, the idea for the Cyber Assistant dates back well beyond 2003 and the IRS has promised its release year after year.

Here are some reasons you should not wait:

1. Benefits of obtaining 501(c)(3) status that may apply to your organization include discounts on postage, exemption from state and sales taxes, property tax exemptions, and eligibility for private and government grants. In determining whether or not to wait, you need to determine if you can afford to miss these benefits.
2. Your 501(c)(3) status will be retroactive to the date of your incorporation as long as you submit your 1023 application within 27 months of being formed. This means that previous donations to your organization may qualify as tax deductible contributions. If you submit your1023 application after this, you will lose this benefit and be required to submit additional paperwork.
3. Delays and technical issues may plague the Cyber Assistant for many of its initial months once it is released. Although the IRS has designed it with the end-user in mind, good intentions do not always mean good implementation. As with most new software releases, the Cyber Assistant will not be immune to bugs and technical issues, which may add delays to processing your 1023 application. Furthermore, with the stated lower filing fee, I would guess that there will be more applications than ever…leading to further delays!

Above all, you should know that the Cyber Assistant will not make foolproof the 1023 application, just make it more convenient. The point of the Cyber Assistant is to refer you to previous IRS publications when you arrive to a question that you do not know how to answer. But this still means that you will have to read that IRS publication and try to figure out what they are saying! In some cases, the Cyber Assistant will provide broad advice on certain subjects but that will not replace professional advice to your specific organization and questions. So weigh your options carefully when you are considering whether or not to wait for the Cyber Assistant. 

Information taken from:
Advisory Committee on Tax Exempt and Government Entities
http://www.irs.gov/pub/irs-tege/act_rpt2_part1.pdf

Each year, thousands of people set out to start a nonprofit organization or take their organization to the next level. These individuals are undoubtedly passionate about their cause and truly want to make a difference in their communities. So, like many of us, they make nonprofit new year’s resolution.  Unfortunately, many start off on the wrong foot and fail to achieve their goals.  This is because they fail to fully develop their resolution through comprehensive planning. While setting out a goal or a nonprofit new year’s resolution is a great way to start tackling your list of initiatives, it means little if you do not follow through and achieve it.   To help you identify what areas may need attention before taking on your nonprofit new year’s resolution, here are some common things to think about.

Take care of the basics?

• Obtain 501 status
• Make sure you are registered in each state you solicit funding in
• File your taxes to keep from being removed from Publication 78
• Make sure you are exempt from state taxes

Know what tasks you may want to outsource to a proffessional?

• Grant Writing
• Web Development
• Bookkeeping and Accounting

Keep precise books on your budget and expenses?

• Salary
• Rent/ Utilities
• Office Supplies
• Program Supplies
• Fundraising Costs

Know what makes your organization unique?

• Choose methods of service delivery that are unique
• Do not duplicate the services of other organizations in your community
• Discover ways to collaborate with other nonprofits or small businesses, offering unique partnership abilities

By taking care of basic administrative tasks you will free up valuable time to work on your goals and ensure the acievement of your Nonprofit New Year’s Resoultion.  Additionally, you will be setting a solid foundation for a successful nonprofit organization far beyond your resolution!

It’s a new year and new start for nonprofit entrepreneurs and leaders!  If you already have an established organization you probably have made the resolution to implement new strategies, to finally launch your nonprofit website or to engage in additional marketing initiatives to bring record-setting awareness of your mission! If you haven’t yet started your nonprofit organization, there is no better time than now to jump into the nonprofit startup process by getting yourself organized and a clear mission established.  Which ever category you fall into, there are a few important things to remember: The best fundraisers, events and donor campaigns will only be achieved through effectively PLANNING and PREPARING for all of your anticipated initiatives.

Nonprofit organizations and leaders across the U.S. share the same goal: to effectively spread their mission and build awareness for their worthy cause!  Those who achieve thier goal have most likely taken the critical steps in properly planning and preparing for their new initiatives or resolutions.  Those nonprofit organizations who have failed, ask themselves: “where did I go wrong?” or “it was a great event, why didn’t I get donations?” The problem here is that they skipped those critical planning and preparation steps that take care of every aspect of their initiative. 

While there are many things you should be thinking about, we have compiled a list of the Top 5 Things You Should Be Doing to start PLANNING  and PREPARING your nonprofit organization for success in 2010!

The Top 5 Things Your Nonprofit Should Be Doing!

1. Creating or Re-evaluating you Strategic Plan - A nonprofit strategic plan is the “game plan” for how the organization will reach its goals.  It is the framework that determines where an organization is going over the next year or more; how it’s going to get there; and how it will know if it got there or not!  Strategic planning steers an organization on the path to success.
2. Start Preparing for Nonprofit Tax Season -A 501(c)(3) organization’s annually mandated filing with the IRS is the form 990. All organizations are now required to file, regardless of revenue; however the version of the form will differ based upon the year’s receipts.  Now is the time to get a professional CPA or Bookkeeper to avoid errors in your filings, heavy fines, and a set-back to your goals.
3. Create a Quarterly/Monthly Marketing Plan – Many nonprofit organizations make the resolution to implement new “cost-effective” marketing strategies that will boost donations and build a wider awareness of their organization .  While this goal is more than possible, it can go extremely wrong and waste a lot of time and energy if a PLANNED nonprofit marketing strategy is not put in place.
4. Put 2009 in the Past - Make sure all the loose ends tied up from 2009, including: donor comittments, holiday event wrap-ups, reporting, financials and anything else that may insufficiently occupy time in the new year.
5. Always Make a Compelling Story- Nonprofit organizations must have a strong case for support, a compelling story about what the organization does.  They need to be able to tell that story in different ways to different audiences at all times and at all events. Donors must know where their dollars go and that they have positive impact.

I’m not saying that planning and preparation will eliviate every possible problem that may come in the way of your events, inititiatives and fundraisers.  It will tho, significantly add to the effectiveness of each new initiative or goal your nonprofit organization takes on this year.

Are you a nonprofit entrepreneur or leader who has experienced failure due to a lack of planning and prepartion?  If so, tell us your story and share a few tips for other nonprofit organizations!

People sometimes question the need for a mission statement, but an accurate, effective mission statement is essential to your nonprofit organization. Why? It’s the most widely used nonprofit marketing piece, and it’s your first and most concise tool to win public understanding. 

What’s included in a mission statement?

A mission statement encompasses the following:

• Explains why your organization exists
• Defines what you do
• Sets your priorities
• Motivates your activities

However, the purpose of a mission statement is not to give all your program descriptions, because you want to keep it short. A mission statement serves as a blueprint of your activities, so it should be clear, uncluttered, and not full of adjectives – just stick to the facts.

How should you use your mission statement?

You should include your mission statement on all your publications, in your press releases, and everywhere you say something about your organization. You can even put it on your fax cover sheets. It serves as a brief introduction for those who don’t know you and a reminder for those who do.

How does my mission statement relate to my goals?

Your success as a nonprofit organization can be measured by how effectively you perform to achieve the mission you’ve outlined. Therefore, any projects your organization chooses to undertake should be compatible with the mission statement you have already established. A mission statement serves as a yardstick for deciding what programs your organization can and should undertake. Even if a program is valuable and interesting, if it is not relevant to your organization’s mission, it is likely better suited to another organization.

More and more organizations are using charity auctions to supplement their fundraising. Charity auctions can be profitable and fun, however to ensure success organizational administrators must undertake careful planning and maintain an eye for details. The amount of time necessary to plan such an event will vary depending on how large scale an auction your organization wants to undertake. For a major event with widespread awareness, a minimum of 6 to 9 months is required.

Before beginning, it must be determined that the organization possesses adequate funding to cover up-front costs associated with the auction. These will include items such as invitations, advertising, food, drinks, decorations, location, entertainment, lighting, gift bags, the auctioneer, and more. Once the budget is set, a fundraising goal should be calculated. The fundraising goal should include the costs associated with the event, as well as the additional amount that is needed to be raised to cover necessary program expenses.

Volunteers will need to be recruited to be responsible for decorations, publicity, coordinating volunteers, the auction itself, cleaning up after the event, and of course procuring items for the auction. Without exciting items on auction, the chances of you reaching your fundraising goal are slim. Event coordinators should try to put together packages and items that are unique-something you can’t find just anywhere. Make sure the items will appeal to the audience you are inviting. Use whatever connections you and your constituents have to bring in quality items for your auction.

One major contributor to a successful charity auction is publicity. Publicize! The more people hear about your charity auction and get excited about it, the better your chances of selling more tickets and reaching your goals. Depending on the budget, you can utilize direct mailing, TV ads, radio ads, newspaper ads, or anything else that will reach your target audience. Reach out to local media to utilize free PSA time.

Keep in mind that to be successful you’ll also need to concentrate on drawing an appropriate crowd. If you expect quality people to attend your auction every year and donate to your organization, you need to make it an event worth attending. It should be referred to as “the party of the season”, or “the event not to be missed!” Stay focused on the guest list. You don’t have to convince your core supporters to attend since they will always be there for you. Rather, you are after the “swing” attendees in the community – the movers and shakers who make the rounds to the best events. These people are going to attend someone’s party; they just haven’t decided whose. All things being equal, they tend to focus on the fundraiser that offers something better than the rest. Create an atmosphere that is impossible to resist, and they’ll arrive ready to spend.

Finally, be prepared to give quality information to your donors about their contribution. Donors who purchase items at a charity auction may claim a charitable contribution deduction for the excess of the purchase price paid for an item over its fair market value. The donor must be able to show, however, that he or she knew that the value of the item was less than the amount paid. For example, a charity may publish a catalog, given to each person who attends an auction, providing a good faith estimate of items that will be available for bidding. Assuming the donor has no reason to doubt the accuracy of the published estimate, if he or she pays more than the published value, the difference between the amount paid and the published value may constitute a charitable contribution deduction.