7 Lessons Learned by Consulting Non-Profits

Have plans for a new non-profit that will change the world?

Then think again. A majority of the non-profit ideas we hear are either unoriginal, unneeded, or unlikely. So, are you really the exceptional exception?

Let’s backpedal a little. There’s nothing inherently wrong with non-profits; they constitute the backbone of civil society. Nor is it necessarily wrong to steer clear of monetary profits.

But please, don’t start another non-profit without considering these seven questions:

• Is there an existing organization you can work with or under?

As a consultant for non-profits, we can almost always find comparable, already-existing models and organizations to partner with. Sure, there’s the occasional model that’s so unique it needs to start from scratch. And for a healthy project, you might hope to outgrow a parent organization. But why not start by operating under an existing non-profit? So many unnecessary expenses go along with starting a new thing; it’s usually better to have the buy-in and experience of another organization.

Lesson: Don’t duplicate an existing model without trying to partner with others, and don’t start something alone when you could have the backing of an existing organization.

• Can the business model be self-sustaining?

There’s nothing wrong with receiving a partial return for your organization’s efforts (within the IRS guidelines, of course). As a non-profit, your primary purpose is to benefit society, but tax-exempt status shouldn’t be taken as a license to mooch or be wasteful. If you can make your model self-sustaining, then you should probably do it. Use your grants and fundraising efforts to start, build and expand programs and projects—rather than simply maintain them.

Lesson: Think of ways to bring in additional revenue from services provided. That will strengthen your business model and signal to donors that their money won’t be flushed.

• If you’re not making a profit, then why bother?

If you trace the etymology of the word “profit,” you’ll find its historic meaning is broader and more expansive than the way we define it now (to mean financial advantage strictly). The word has more to do with an overall “benefit” or a sense of “progress.” If your organization isn’t creating value – if it isn’t benefiting people or helping society progress– then shut it down.

Lesson: Even if making money is not a tangential goal, be sure you can prove your benefit to society.

• Why isn’t money being thrown at me?

This might sound like a silly question, but it has a point: the best ideas get funded fairly easily when promoted properly. So if you’re struggling, then you’re probably pulling from the wrong well. On a side note, too many non-profits expect people to give of their time and money just because they have non-profit status. Don’t be that way. Make a compelling case for your existence or else reimburse your outside help (this advice is shamelessly self-serving).

Lesson: Don’t expect people to volunteer their time, services or money just because of your non-profit status. Promote your services and compensate others.

• Are you using your non-profit status as an excuse?

Getting non-profit status is not a free pass to manage your organization poorly. You need business management skills, which means if you don’t have these skills, you should find advisors and co-laborers who do.

Lesson: Run your non-profit like a real business.

• How can you include others?

You need buy-in from most or all of your stakeholders, so try to provide a sense of ownership and responsibility to everyone you can. You may run the risk of losing people over conflicting visions, but you’ll end up with a stronger team and with a clearer goal in the end.

Lesson: Invite as many as you can to the table when appropriate.

• Are you dreaming too big?

Hold back! It’s alarming, frankly, to hear an average person claim they’ll easily start a national (or international!) project. You might have identified a real need, you might be the person to manage, but prove your model on the local level before you bother to dream much bigger.

Lesson: Build a solid foundation so you can increase in size, but don’t be unrealistic. Focus on your village.