Welcome to my somewhat intermittent blog! I love the nonprofit world and talking and reading and especially working in the sector! Throughout my journey, I constantly encounter people who want to know more about the nuts and bolts of nonprofits. What is a nonprofit? What do they do? Who has oversight of them? How do you start one? Do I need to start one?
I’ve been giving presentations at area libraries (because I love libraries just as much as nonprofits!) through the cooperation of the Foundation Center about what is involved in starting a nonprofit organization. Starting and keeping up with a nonprofit is a TON of work and my goal is to provide people with a general overview of the process to help them make a decision about how to proceed. I also want to educate people about the many wonderful, reputable organizations who provide information and support for start-up charities, so that if you’re ready to start, you know where to turn for help.
Starting a nonprofit is a labor-intensive and expensive process. I hope that my information can help you make an informed decision about whether or not 501(c)(3) status will further your mission and goals so you can direct your energy, time, and resources to where it can be the most effective!
Read through my Start-up Series here to get an idea of the process.
And finally, I am not a lawyer or an accountant. I encourage you to seek the advice of a qualified attorney and/or Certified Public Accountant with questions. There are many individuals and practices who specialize in nonprofits who can help. Maryland Nonprofits is a great starting point for identifying reputable firms.
2015 is here! January is a month with several looming deadlines for nonprofits so now’s the time to take stock of common tasks. Key among them is making sure you issue 1099’s and W-2’s for contractors and employees by January 31st. It’s also a good idea to touch base with last year’s donors and thank them for their support with a letter they can use when preparing their income taxes. Check out this post with a list of things to track as the new year begins!
I’m looking forward to presenting at the Annapolis Area Library next week about my experiences with nonprofit start-up. If you’d like an overview of the process, take a look at my Do You Want to Start a Nonprofit Series!
If you’d like to sign up for this free seminar from the Anne Arundel County Library, registration info is available here.
Here’s wishing everyone a wonderful and prosperous New Year!
I’ve made it a personal mission in the last several years to share the start-up experience, warts and all with people so they can make an informed decision. I don’t want to frighten folks, it’s just that nonprofits aren’t all just unrestricted grant funds and happy feelings. They are expensive, the structure can be cumbersome, and they are a TON of work!
So if you’ve read my start-up series, and you’re thinking, “Whoa Nelly, that’s not for me” and you’re wondering about your options, here are two alternatives to starting up your own full-blown nonprofit organization.
A Tale of Six-Toed Cats: The Fiscal Sponsorship
Lena loves one-eyed, six-toed cats. They are historically connected to the area and she’s exhausting the limit of what she can do personally on her property to help these winsome creatures. She’s concerned that there are many more kitties she’s not able to help and a couple of her friends are also empathetic about the plight of these felines.
In the meantime, the local county animal rescue group is overwhelmed helping all the regular-toed cats, dogs, hamsters, monkeys, guniea pigs, and giant rabbits. They just don’t have the resources to address one niche group beyond their stock of regular services.
Lena is motivated and already has several friends who are willing to volunteer and donate money to the cause but they really don’t want to be on a board or wait 3 years to be able to deduct their contributions from their taxes.
In this case, Lena could approach the local animal rescue group and bring her resources to bear in exchange for their administrative support. The local group can expand their reach and address a niche need that they don’t have the time or expertise to solve.
Over at the Foundation Center, they covered the basics of Fiscal Sponsorship. Fiscal sponsorships are a great options for several reasons. First, you don’t have to build and maintain an administrative infrastructure and get sidetracked by paperwork. Second, you can help an existing organization tackle a particular issue or concern that it otherwise may not be able to affect either because of a lack of information or resources. Third, funders love to see partnerships and groups working together and your combined strengths demonstrate a stable environment that makes your cause a worthwhile investment. Now, instead of two organizations competing for the same resources, you have one consolidated group making the world better!
That said, please don’t go pestering the local animal shelter with a half-baked idea. If you know the problem, take some time to put together a proposal and include research and proposed financials. In other words, do some of the legwork for them and make an organized case for your cause.
More Money Than You Know What To Do With: A Tale of Donor-Advised Funds
Bill Blarney hit the lottery. No seriously. He had the winning numbers to last month’s PowerBall and now has quite a tidy sum. Bill likes a simple life and after paying a few bills and sticking a little cash by for a rainy day, he’s looking at a bunch of excess money that he really doesn’t need. One can only play so much golf in a day. Bill was raised in a tough neighborhood in the city and thanks to a good education and some luck, he was able to get out and build a good solid life for himself. He thinks that his lottery winnings could do some good for people from his old neighborhood but isn’t sure how to distribute money in a way that would have meaningful impact.
In this case, Bill finds the local community foundation and creates a donor advised fund. GrantSpace has a great article on this concept and how to research ways to create one. Bill directs the foundation on the kinds of issues he would like his fund to address and the Community Foundation uses its existing grant-making processes to see that Bill’s money is granted to individuals and organizations in his former neighborhood.
What I love about working in nonprofits is the passion that people bring to making their neighborhoods and communities better places. It’s hard to dampen the enthusiasm but that’s exactly what will eventually happen over time as these passionate folks get bogged down writing by-laws and conflict of interest statements. The real question to ask is “What is the change I want to create?” and take a look at whether or not one of these two alternatives would be an option for your cause!
By the way, if you haven’t checked out the completely hilarious, slightly irreverant (okay more than slightly), but absolutely dead-on blog of Vu Le, go over there now! Vu also blogs for Blue Avocado which is a great clearinghouse for nonprofits.
Are you in the Hagerstown area and want to know more about starting a nonprofit? I’ll be presenting at the Washington County Free Library on October 8th!
Photo of one of the famous six-toed cats at the Ernest Hemingway House in Key West. Photo from Wikimedia Commons. By Wknight94 (Own work) [GFDL (http://www.gnu.org/copyleft/fdl.html), GFDL (http://www.gnu.org/copyleft/fdl.html) or CC-BY-SA-3.0 (http://creativecommons.org/licenses/by-sa/3.0/)%5D, via Wikimedia Commons
After a miserable, cold winter, summer’s heat and humidity are well set-in here in the mid-Atlantic! I’ve been off having adventures and full blog posts are hard to come by. Here’s a roundup of some of the random things that have been on my mind the last month or so!
Do you really know what your volunteers are doing or what they need to succeed? I have never met an organization that didn’t need volunteer labor of some kind but with the exception of organizations built on a model of utilizing volunteers for service delivery, most of us do a miserable job with volunteer management.
Pointless, duplicated efforts – I was speaking with a friend who had begun volunteering to help clean an organization’s facility. As she began helping it became clear there was no coordination of responsibilities. The organization had an outside cleaning company coming in but beyond a few specific tasks, nobody knew what the cleaners did. She also discovered that another volunteer came in to vacuum later in the week. She felt like her efforts were useless when others were duplicating the same effort. What was the point?
Wasting volunteer time – My time is precious so don’t waste it and I know I am not alone. One organization relies heavily on volunteers a couple of times a year. There are so many moving parts and it is very difficult to coordinate and anticipate how the event will go. That said, there winds up being a lot of down time waiting for supplies, no clear directions, too many people in one location and a shortage in another, and lots of individuals wandering in and out with contradictory information. Volunteers get frustrated when they come out prepared to work and they spend the majority of the time waiting.
The new IRS 1023 Application – I haven’t yet had a chance to catch up on the newly announced application process that is supposed to smaller, easier, faster and ONLINE! I am looking forward to setting aside some time to investigate the resources that go along with the announcement. I am excited at the prospect that my entire How to Start a Nonprofit Series will need to be redone or scrapped completely.
And here’s a couple of interesting links:
The Founding Fathers Write a Grant Proposal from Blue Avocado was an enjoyable Independence Day read.
Getting your board more involved in a meaningful way is something every organization struggles to accomplish. I rather enjoyed Will Folsom’s take on board recruitment in “Board of the Rings: Assembling an Epic Board to Save Your NPO (or Maybe Middle Earth) over at Nonprofit Hub.
What about you? Have you been tracking anything interesting or confronting your pet peeves? Or have you been off having epic adventures? Tell me about them in the comments!
With the warmer weather, I have been slacking off a bit. Here’s a few gems I have found in my RSS reader that have gotten me thinking about nonprofit issues. Enjoy!
The Chronicle of Philanthropy provides an overview of the Mark Zuckerberg donation to the Newark Schools and the recent look back at how the money was used. Complaints ranged from lack of transparency to reporting that 20% of the gift was paid out to consultants. It doesn’t matter how reasonable it seems from the inside, when you do something, picture it in the papers the next day!
This slideshare from Social Velocity is a succinct presentation on financing your nonprofit versus fundraising. If you’re looking for a tool to start discussions with your board or leadership on how to make this switch, start here. My favorite part are the actual, “here’s what your board can do” tasks.
Maryland Nonprofit’s blog from April provides another great point for opening up strategy discussions with your leadership with this post of Sustainability Questions Every Nonprofit CEO Should Ask.
I love following the American Society of Association Executives via their Association’s Now blog and found this great article on one of their social media roundups. Even if you aren’t a membership-based organization, consider your processes when implementing new policies and procedures. If you’re setting up something that looks great on paper but actually works against the way people will actually use it, then it’s going to fail.
To lighten the mood: What do you get when you cross a Program Director, a Volunteer Manager, and a Janitor? Answer: A situation that is not too uncommon in most nonprofit organizations. Check out the rest of the very funny (especially the last one!) classic nonprofit jokes!
So what have you been reading lately? Or you have you been enjoying the weather and getting outside?
My goal is to post something new at least once a month on here but I missed last month. I’ve been slogging through a time management problem – over-commitment! As I evaluated where I was spending my time I realized I had personally fallen prey to the dreaded Mission Creep!
What is Mission Creep? According to Wikipedia, “Mission creep is the expansion of a project or mission beyond its original goals, often after initial successes. Mission creep is usually considered undesirable due to the dangerous path of each success breeding more ambitious attempts, only stopping when a final, often catastrophic, failure occurs“. Nonprofits fall prey to it when they don’t have strong leadership focused on the mission or they’re chasing money.
The insidiousness of Mission Creep is that victims aren’t really aware of it while it is happening to them.
The first step in killing Mission Creep is to home in on Purpose or Mission. I needed to revisit my objectives. I narrowed it down into personal and professional. I set a purpose for each area. My goals are fairly modest and I really wanted to keep it simple to avoid the danger of over-engineering this process and fooling myself into thinking I was doing something when all I was really doing was rearranging things.
The next step is to align current activities against your Purpose/Mission and evaluate whether or not they are serving it. Here’s how I did it:
Cut One: Is this related to my purpose?
I looked at all the things I did and determined whether those associations did anything to further my personal and professional goals. One volunteer job had been taken on because I was looking to gain experience in a particular area of nonprofit management. For several years I had the opportunity to learn new things, but recently, the job had become repetitive and offered no challenges. Result: I eliminated a volunteer job that no longer served any either my personal or professional goals.
Cut Two: Is it Profitable?
Let’s start with the most basic. I listed all my activities and determined which ones I had a good time doing. I highlighted the ones that I didn’t enjoy or felt kind of “meh” about. If I am giving my time, I want to get something in return. If it is paid work that is easy to value. On the other hand, if I am volunteering my time, I want to enjoy the time I spend and feel that I have accomplished something. Result: I was able to articulate the value of my activities in terms of my personal enjoyment, impact, and econcomically.
Cut Three: Is there anything redeeming about the Annoying activities?
Everything has some sort of annoyance factor. I needed to evaluate whether or not the irritation was outweighed by the result of the activity. For one of my volunteer tasks, the constant, irritating barrage of last-minute requests, disorganization, and over-emphasis of things that I felt didn’t contribute to the bottom-line made it an obvious candidate for cutting. Result: I decided to let another volunteer role go.
After evaluating my activities against mission creep here’s what I learned:
- Just because I participate in activities doesn’t mean I have to take on a leadership role.
- Just because I CAN do something doesn’t mean that I SHOULD do something.
- Just because nobody else is stepping up to keep a group going doesn’t mean I need to fill that void. The death of the group may be a good indicator that it has outlived its purpose.
Unfortunately, it has been difficult because people will continue to ask you to do things (Because they are over-committed themselves). They don’t want to accept your NO and will continue to try to find workable iterations. I am staying strong and continuing to say NO because in the long run it’s better for everyone. In some ways, now that I’ve settled on what is important, I know I have no more time to give and it has made it easier to say NO to additional requests.
What about you? Have you found yourself over-committed? How did you cull your commitments? What tactics do you use to prevent yourself from falling prey to personal mission creep?
I am preparing for another presentation at the Annapolis Library next week and I am thinking about nonprofit start up. Doing these presentations is always enjoyable because of the people I get to meet. It is also a wee bit intimidating. As I think about the kinds of organizations the attendees represent or are interested in starting, here’s a few opposing structures and what they can learn from each other!
Professional associations vs human service organizations – I have worked with both types of groups and I think there are lessons that can be adapted. Professional associations are created and operated by a group of professionals for the benefit of their peers. These organizations live and die by their membership and must constantly provide what their members need in order to stay viable. They care deeply about customer service. Human service organizations need to remember to stay abreast of the latest evidence and trends about effective methods for their area of concern but can sometimes let customer service fall to the side in the trenches of dealing with difficult human problems. For both types, there’s a danger of the board becoming insulated from the people you serve. Have a client representative on your board or keep a focus group going so that you don’t miss the subtleties of the community you serve.
All volunteer versus paid staff – many times small all-volunteer organizations struggle to stay on top of routine activities and administrative duties and gaze enviously upon those organizations who can afford to have office space and paid staff to complete these tasks. Trust me when I tell you, paid staff organizations are many times just as flustered and reactionary as a nonprofit without staff. Honestly, it comes down to organization and training. Even all-volunteer groups can take advantage of training at www.stayexempt.org, Maryland Nonprofits, or even local groups such as the Association of Community Services or at your local library! Seek out training opportunities and technical assistance help. Don’t slog up the learning curve alone.
Subgroups versus independent organizations – The benefit subgroups often have is that they have structure already in place by the parent organization. The Parent Teacher Association for example, offers pre-written by-laws, insurance, and group tax exemption saving smaller groups thousands of dollars and headache. Their model is such that they know the vast majority of their local leaders are inexperienced and don’t want a crash course in nonprofit management. Parents want to get in, support their local school, and get out. Independent groups have to do all that alone without help and guidance. The structural support can be nice and helpful, but it can also be suffocating if you have ideas that don’t fit neatly within the existing framework. Independent organizations can overcome some of this by looking to larger groups for support and assistance such as associations for groups serving the same populations. An example of this is the National Park Friends Alliance.
Large national organizations versus small community-based organizations – Larger organizations have the benefit of the economy of scale. They may be able to do more on a higher level because they can afford paid staff such as grant writers and development directors that can make a huge difference in financing their activities or in terms of advocacy. That said, it is easy for those large organization to not understand some of the communities they serve. Larger organizations can adapt some of the models for ensuring they stay in touch with the communities they serve. Smaller groups can capitalize on their local connections and understanding of the problem to tell compelling stories and gain support. Large or small, your community cares most about the real impact of the organization on their neighborhood.
The bottom line is that there are good techniques, best practices, and neat ideas that are all around us. If you find something interesting, useful, or effective, take a look and see if it might work for your organization!
It is the end of December and I am amazed that Christmas is almost upon us! I have neglected my poor blog here as I have been very busy winding down the year. I wanted to share what I’ve been up to because these end of the year tasks are very easy to lose track of doing, particularly if your organization is on a fiscal year versus a calendar year!
Annual financial filings – if you follow the Maryland State Fiscal year which runs July 1 through June 30th, your annual financial filings will be due in November and December. Your 990 or 990 E-Postcard is due on the 15th of the 5th month after the close of your fiscal year so if you’re on Maryland’s fiscal year, that was November 15th. Your updates to the Maryland Secretary of State are due by December 31st.
Tax paperwork – Individual information for filing taxes are tied to the CALENDAR year, NOT your fiscal year. Tax filings such as 1099’s are due out by the end of January and should cover the prior calendar year information. If you had a contractor who worked for you throughout the year, you need to tally up payments made to her from January through December – even if your fiscal year started in July. Be good to your donors, employees, and contractors and make sure you get that information sent out in a timely manner.
Donor Check In – many groups mount a final appeal for the calendar year in order to take advantage of people making last minute charitable contributions at the end of the tax year. This is a good time to send holiday greetings to your donors and thank them for their support during the year and provide an opportunity for them to make a final contribution. Pull together your list of donors and amounts given from January through December of the year to prepare for acknowledgement letters that you should send out no later than January so your donors have a convenient document for their tax preparation.
Look ahead and plan- As you begin to fill in your new calendars, take a few minutes to add your major dates for your organization. When is your Annual Meeting? When do Elections occur? Have you allocated planning time? If your elections are to take place in May, your Nominating Committee needs to start getting active in January in order to identify and vet candidates and assemble the slate for the Board to review. January is also a good time to read through your By-Laws to check for any changes. These are items that often have time restrictions and need to be scheduled.
If your organization is on a fiscal year versus a calendar year, don’t fall into the trap of thinking there’s nothing happening during the end of the year. Take some time in December to look ahead to January and the coming year. While not as fun as end of the year parties and holiday celebrations, setting aside and planning for them means a calmer January.
Is there anything else you’re doing at the end of the year that should be included?
So how do you avoid wasting time with your planning? Let’s pick on my favorite fake organization, Bucksnort Do-Gooders. This is a science fiction costume group whose primary activities are providing a place where they can re-create their favorite costumes, meet other people, and provide opportunities for community service.
Keep your eyes on the bigger picture. At the start of the meeting, write down your mission statement or your overall purpose. Bucksnort Do-Gooders might write down, “How do we provide more opportunities for our members to play and help their community.” Don’t worry about making this sound all mission-statement-y. Just nail down your purpose for planning.
During the discussion, the idea comes out that the group should sponsor a 5K run to make money. On the surface, raising money for local groups is a good thing, but the reality is, a 5K doesn’t really match the purpose of the group. People can’t run in costume. There’s no real time for people to discuss costuming. It will be a lot of work but distract from the primary reason people want to be a part of Bucksnort Do-Gooders.
Assign responsibilities. How many times have great ideas or tasks been put forward but fizzled because nobody actually did the tasks? Time and talents must be committed.
Bucksnort Do-Gooders decide they would have more reach with a social media account. Everyone agrees that this would help them connect members with each other, share costuming techniques, and showcase their community service. It meets the main goal. During the meeting they pick several outlets for the social media and assign the maintenance of the accounts to specific board members.
Baby steps are okay too. Planning doesn’t always have to mean developing a complex set of goals and objectives for the next ten years. Sometimes, you just need to keep your organization moving forward.
Bucksnort Do-Gooders knows that they need to refine their strategy for future growth. During the meeting they realize that this is going to take more research and planning but in the meantime, they don’t want to drop out of site. They agree to continue doing periodic activities just to stay on the radar screen while they develop a deeper approach. They assign certain activities to specific board members to keep the organization more forward.
Don’t let the pursuit of perfect interfere with good enough. Good enough will carry you forward while seeking perfection can stop your mission cold.
How about you? Have you seen planning go horribly awry or distract to the point where nothing is happening?
The summer is winding to a close and my blog has taken a back seat to more exciting ventures during the warm Maryland months. As the academic year begins, I like to reflect on my summer and what I gained from my adventures. What did I do and learn on my summer vacation?
I volunteered. A lot. It wasn’t really planned and I can’t really articulate why. I just went with opportunities that landed in my lap. It ran the gamut from watering plants to an intense week of teaching outside in the August heat at Cub Scout Day Camp. Looking back, I enjoyed everything I did because it wasn’t on my radar and because I wasn’t a decision-maker in the process. I showed up and did what was needed, admired my completed task, and went about my day. Sometimes time-limited, low responsibility (even if they are hard labor) tasks are what individuals are most comfortable with contributing.
I spent some time letting go of volunteer tasks that were no longer my responsibility. I transitioned roles with one organization which involved taking a huge step back and taking on things that are actually more suited to my interests. That said, I had to stop obsessing about the other tasks I used to do and who would take them over and would they be done to my standard. To continue to poke my nose into those things would be disrespectful to those coming behind me that bring their own talents to the role. It can be difficult to leave or transition tasks within an organization, but you have let the next person do it his/her own way to keep organizations vital and growing.
I watched other leadership styles and pondered how my own could be improved. One of the most interesting things about being involved in Cub Scouts and Boy Scouts is the opportunity to see the different ways Moms and Guys approach doing things. We Moms are the Chief Plate Spinners. We want to know who is in charge (to make sure its not us), when things are happening, who is supposed to do what, etc. Mostly we do this because we’re juggling transportation schedules, dinner, and various practices. Guys are a lot more, “eh, we’ll show up and just do what needs to be done.” And then it gets done. There is a lot to be said for both approaches and I am trying to find more balance. It is a lot less stressful to not try to plan every detail of an event but at the same time respect that the Moms like me want to figure out how to get dinner and bedtimes worked in around activities. Respect the balance between planning and having faith that what needs to happen will be accomplished.
I am always on the lookout for good ideas and best practices that I can adapt to my groups. As for my summer of volunteering, I have been refreshed and my commitment to other things better defined and renewed. How about you? Did you volunteer or do anything interesting this summer? What did you learn or gain from the experience? Do you borrow ideas and experiences from one group for other organizations?