What is a nonprofit organization?
A nonprofit organization is an organization that uses profits to advance their programs and achieve their goals rather than distribute them as a profit to their owners or stockholders. Nonprofit organizations are broken down into five categories – trade associations, charitable organizations, social clubs, governmental groups and political groups.
How do I know if I am ready to start a nonprofit organization?
Step 1: Research
Examine the need for another nonprofit in the community before you start another nonprofit. Research the community, discover the needs and make sure your organization will survive within the community. If you create a nonprofit that already exists, you will be competing instead of working together to achieve a similar goal, which isn’t good for either organization. If a nonprofit already exists, perhaps you could find ways to collaborate instead of compete.
You can find out whether your nonprofit already exists by searching on Idealist, Guidestar, or Charity Navigator.
Step 2: Who, What, Where, When?
Once you have done the research and determined that starting a new nonprofit organization is still beneficial, take time to answer the who, what, where, when, why and how questions.
Who will the nonprofit organization serve? Who will be involved in the planning?
What services will be offered? What is the overall business plan? A detailed business plan will include a mission, organizational structure, potential partnerships, volunteers and paid staff, budget, marketing plan, and fundraising/resource development.
Where will the organization be located? Where will quality assistance come from if and when needed?
When will you need to file paperwork?
How will I create and sustain a nonprofit organization?
After considering these questions, ask yourself again - why should I start a nonprofit?
Step 3: What kind of organization will I head?
Once you’ve confirmed that you are not duplicating other nonprofit efforts and you have determined the who, what, where, when, how and why, the next step is to decide what kind of organization you will lead. Will your nonprofit be an organization, an unincorporated association, a trust, a social enterprise or a fiscally sponsored project?
Explore where and how you will find and get funding. You will need to generate not only start-up funding, but operational funding. Create a fundraising strategy to solicit donations and apply for grants.
Recruit and orient a board of directors, staff and volunteers that have the same enthusiasm about your nonprofit that you do. Find and equip office space and set up financials. Create a cohesive, concise mission statement and a set of bylaws.
Step 6: Paperwork
To actually get your nonprofit started and running, you must fill out the paperwork needed to set the base. A nonprofit organization must be registered with the state and the IRS.
The paperwork process involves incorporating at the state level, securing your tax exempt status from the federal government, filling out your operational paperwork at the state and local levels, completing internal paperwork and frequent reporting to state entities.
For a more extensive background on launching a nonprofit, visit the Let’s Build Nebraska Resource Library, browse our Expert section, and attend online training classes