ARE YOU REALLY SURE YOU WANT TO BE A NONPROFIT?

I get a couple of dozen inquiries a year that start out something like this:  “I love helping XXXXX and want to start a nonprofit so that I can apply for grants to help more XXXXX” Their interests are as varied as the people themselves. Animals, children, veterans, the homeless, the arts, plants, the environment, their local city park, all of them have worthy targets for their help.

Helping anything or anyone is an admirable goal.  However, there is a little bit more to becoming a nonprofit than most people realize.

It takes more money, more time, and especially more effort than most people imagine. Not counting professional fees, such as the on-going services of attorneys, accountants and yes, consultants, my general rule-of-thumb is a minimum of $2,000, just to file incorporation papers, draw up a set of by-laws that are legally compliant in your state, pay the Internal Revenue Service the fee to file the 1023 application, and set up a rudimentary website. All of that except the website has to be done before you can even apply for grants. I include the website, because the 1023 does ask if you have one, and because it is the first place most people will go to learn more about your organization.

Surprisingly, it isn’t the money that generally causes the would-be philanthropist to abandon the goal of becoming a non-profit. It’s the amount of organization and business-type effort required.

Assembling a board of directors, drafting by-laws and a code of ethics, writing cogent mission, vision and values statements, preparing a strategic plan with rudimentary budgets for operations and programs, and setting up an effective website all take time and energy. As one lady said, “If I get bogged down in all that stuff, I can’t help anybody”.

I have nothing but admiration for groups of people that form nonprofits. However, if all that “organizational stuff” doesn’t appeal to you, there is certainly nothing wrong with volunteering with an organization that aligns with your interests. Volunteers are the lifeblood of any nonprofit, so if you want to help, by all means, volunteer!

If you do want to form a nonprofit, start with good basics, and you will be well on the way to helping far more XXXXX than you are at the present time.