Using Donations to Support Your Business
The question of establishing a business that is for-profit or non-profit is a challenging one for many social-entrepreneurs. Nonetheless, for businesses, funding is often a challenging issue to find solutions for. However, the benefit of establishing a non-profit is that it makes it much easier to receive donations as a form of funding. When seeking donations, here are some tips to consider: set the purpose, develop an end goal, create a list, follow-up and track documents.
Set the Purpose
Initially, it is very important that a purpose is established. This is the first step in determining where your organization is going. Funders will want to know what your organization represents. There should be a cultural plan and a business plan established that outlines where potential funds will go. It is not always necessary to re-invent the wheel. Many organizations have cultural plans that can be modeled to fit the objectives of your organization. A question to ask is: What are we trying to do here?
Develop an End Goal
It should be very clear before asking for donated funds or supplies, on how the funds or other resources will be allocated. Furthermore, the organization should know how much money or other resource should be attained from donations. This will set clear expectations for whoever is leading this initiative. A question to ask is: How much or many resource(s) do I need for a given project or for my operations?
Create a List of Potential Sponsors
After knowing the resources that your organization is looking for, create a list of potential sponsors that can help you meet your goal or who may donate to your organization. One may look at whether the potential sponsor has donated similar funds in the past or if the potential sponsor has materials that could benefit your organization in meeting its goal. A question to ask is: Which companies align with my organization’s mission or projected goal?
Follow-up on Potential Sponsors
Once potential sponsors have been identified and contacted, it is important to follow-up on interest to secure a donation. Leaders in organizations are often quite busy and it’s necessary to be persistent in funding pursuits. A question to ask is: Is this potential sponsor still interested in supporting our goal?
Track Documents for Accountability
It is necessary that whoever is leading donation initiatives track organizations and what they are contributing. By donating to non-profits with 501c3 recognition, organizations can gain tax benefits. Consequently, organizations receiving donated resources must document what they receive for taxation purposes. Additionally, this will help in creating projections for other funding goals in the future.
Seeking funding is a vital goal for start-up non-profits. Fundraising can often be challenging for stakeholders overall. When considering fundraising, there are several aspects to consider. It’s important for business leaders to remember to set a purpose, develop an end goal, create a list of potential sponsors, follow-up on potential sponsors and track documents thoroughly. These will lead to fundraising success.