Every day, people get inspired to start a nonprofit organization as a way to serve their communities. Perhaps you are one of those people who have a desire to solve a certain issue in a community, as well as a plan on how to do it.
However, starting a nonprofit is a time-consuming and complex endeavor. If you’re looking to form a nonprofit, we’re here to help with our step-by-step guide.
1. Do Research
Before you begin your journey, it’s important that you identify if there is a need for your specific organization. Check to see if other organizations are already doing similar or the same work, and make sure that a nonprofit organization is the right solution to the issue.
Going over these things will help you decide if starting a nonprofit organization is the right move or a different solution would better help your community.
2. Determine Your Mission
By having a clearly written and communicated mission, you will have an easier time making decisions further down the line and focusing your energy and attention. A mission statement should inform others about what you do and guide your stakeholders and your employees.
Make sure that your mission statement is easy to understand, simple and unambiguous. A well-written mission statement should also be straight-to-the-point and brief. Lastly, avoid generalities, buzzwords, and expert language.
3. Create a Business Plan
Invest a good amount of effort and time into crafting a business plan for your nonprofit. A well-written nonprofit business plan will provide the discipline and structure to think through critically important operational and strategic issues. Moreover, a business plan is crucial if you plan to pursue funding from the government or donors, and it can also help you recruit board members, volunteers, and employees.
4. Choose a Name
Among the first things you need to do when forming a nonprofit is to choose a name for it. You should go for a name that is related to the main cause of your nonprofit and is unique.
Make sure that you take some time when you’re making this decision since the name of the organization will influence your brand in the upcoming years. Some tips we would offer when choosing a name for your nonprofit are the following:
- The name should be easy to recall and pronounce. Don’t make it too long, and don’t use industry-specific or technical jargon.
- Try brainstorming with your acquaintances or team members to get some ideas.
- Make sure that the name you intend to use isn’t already trademarked. Some government sites offer access to their database of nonprofit names, so you can use this for help.
- See if the name is similar to another organization’s name. If it is, you can make yourself susceptible to trademark infringement or copyright lawsuits. Even if the organization doesn’t file a lawsuit, people will mix up your names, which is something you don’t want.
5. Set Up a Board
Even though the chances are that your board will change and grow over time, during the initial stage it’s always a smart move to select a board with members that serve a functional need. Choose members that can dedicate time as well as applicable and useful expertise, are interested in your mission, have previous board experience, and don’t have a conflict of interest with your cause or organization.
Even though recruitment is an essential step in this stage, to ensure the long-term success of the board it’s important that you include orientation, training, cultivation, and evaluation of the board members.
6. The Incorporation Process
A lot of nonprofit organizations decide to incorporate because it allows them to obtain certain legal and tax advantages. Moreover, having a formal structure will give credibility to your services and programs.
The incorporation process includes filling for an Employer Identification Number (EIN) and picking a business name that is legally available in your country. Fees and filings will vary by state, and the IRS requires governance policies and organizing documents that are usually associated with corporations.
Final Thoughts
The steps we described in this article will not only help you start a nonprofit but will also set it up for success. Now that you know how to make your dream a reality, it’s time to take things into your own hands and form your nonprofit.
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