Tiffany Allen presents: Boss on a Budget

Boss on a Budget

By: Tiffany Allen

1. How have recent years impacted the number of new and small nonprofits?

Recent data show that at least 68,000 nonprofit organizations obtained their 501(c)(3) status in 2020. That was in the middle of a pandemic! That’s an indicator that despite economic challenges brought on by the COVID-19 pandemic, people saw their communities struggling and responded by starting their own organizations. Anecdotally, with my company Boss on a Budget, I have seen a steady increase of people reaching out who want to learn how to start their nonprofits. While I believe an increased interest in nonprofits is important, nonprofit founders aren’t always well educated about what it takes to become financially sustainable. Many new and small nonprofits fail without savvy fundraising and marketing.

2. What is the potential impact that these nonprofits can have?

New and small nonprofits have an incredible advantage. They are often started in direct response to a problem, by people with lived experience. Having new organizations started by individuals often shut out of Board positions or executive leadership, creates the opportunity for communities of color or other marginalized communities to build their own spaces that reflect their culture and their values. New and small nonprofits are more nimble and tend to be less afraid to take risks. Their ideas can be at the forefront of groundbreaking change. Data has also shown that people are losing trust in traditional institutions like government and other nonprofit organizations, but new and small nonprofits based in communities can help rebuild that trust in nonprofits.

3. What is the biggest challenge donors and funders have in reaching new and small nonprofits?

Visibility, plain and simple. If a nonprofit isn’t skilled at marketing or telling their story, then no one will know they exist. Understandably, donors and funders are interested in impact and want to be assured that their donations are being used wisely. When organizations don’t have a long track record or struggle to show their impact, it may turn donors off. But here’s the thing: I also know that donors get excited at the prospect of supporting organizations with new ideas and different solutions to the same problems! To make these connections, new and small nonprofits need training and access to important donor and funder networks to build relationships so they can be discovered.

4. How can the nonprofit industry better support new and small nonprofits?

New and small nonprofits are an important part of the nonprofit sector and they should be acknowledged as such. Many people write off new nonprofits because they don’t believe they’ll survive their startup years. I believe that they play an important role in providing community services, and that funders should intentionally reserve unrestricted funding to support new and smaller programs that may have small budgets but the potential for a big impact in their local communities. When donors and funders provide unrestricted money with little to no strings, it gives new and small nonprofits the flexibility they need to strengthen their infrastructure and scale their programs.

5. For those wanting to start their own nonprofit, what should they focus on?

New nonprofits are successful when they have a strong Board of Directors and a solid strategic and financial plan. Nonprofits have to be intentional about raising money. If not, they risk closing their doors. Nonprofits should focus on having diversified income streams, meaning that they should pursue multiple avenues for making money, like stock donations. Using a service like Donate Stock makes the process super easy and seamless, especially with new or small nonprofits that don’t have the capacity to manage stock donations on their own.

If you need help planning your nonprofit’s first year, grab my nonprofit startup workbook which guides you through the essential areas to focus on during your startup phase.

About the Author:

Tiffany Allen is the CEO of Boss on a Budget, a small firm that teaches communities to form strong nonprofits and obtain funding. Her passion is working with Black-led nonprofits and other new nonprofits, teaching them to use their skills and talents to get funding. She manages an online network of over 10,000 people from across the world who are seeking grant writing assistance and support and teaches nonprofit startups to a combined audience of over 15,000 followers on Youtube and Instagram. She regularly produces videos and written content on grant writing and nonprofit development.