“Don’t keep all your eggs in one basket”- this is how the saying goes.
And this is also valid for nonprofit organizations, having diverse revenue streams can help your organization thrive in the nonprofit world. Whether we talk about episodic funding, government grants or any other income sources , it is essential that your nonprofit has a diverse portfolio of revenue streams.
In this article, we will show you how you can diversify your nonprofit revenue streams and how you can maximize the ones you already have access to!
Nonprofit organizations are traditionally limited to fundraising appeals, grants, and government funding. But there are other ways to diversify your nonprofit revenue streams.
Here are some funding opportunities that can help you increase revenue for your nonprofit organization:
A common revenue stream for nonprofit organizations are donors . They can be individuals, corporate foundations, community foundations, or other organizations. Each of these groups of donors has different reasons for giving and different restrictions on how and when they give it. Donors also have different timelines for making donations (i.e., weekly or monthly). These variations in donor types, especially when some of your major donors only offer restricted funding, can make it difficult to diversify your revenue stream if you’re only pursuing one type of donor at a time.
It’s good practice to pursue several different types of donors at once with the goal of increasing your overall revenue base. While some offer major gifts, each small contribution can have a huge impact on your nonprofit revenue.
When it comes to fundraising appeals, you can choose from a variety of options. You can use email, social media and other digital channels to reach donors. You can also use traditional mail and print materials. Another option is to partner with another nonprofit organization that shares your mission and vision. Some organizations even have their own printed newsletters that they send out monthly or quarterly via email advertising.
If you are passionate about the cause your organization is trying to support, then ask yourself: “How will my passion drive me?” In this way, you will be more effective in raising money for those in need because your passion will be apparent in all aspects of fundraising efforts (e-marketing campaigns).
An endowment fund is a way to raise money for your nonprofit organization that will last forever. It’s also one of the most effective ways to diversify your revenue streams and ensure that your organization can continue to do what it does for years to come.
How much does it cost? There are no set costs associated with establishing an endowment fund, but there are certain steps you need to take in order to create one:
- Identify the type of endowment fund you want (i.e., restricted or unrestricted)
- Create a mission statement and goals for how you plan on using the funds generated by these investments (i.e., pay staff salaries or support programs)
- Set up donor recognition systems, so people know how much they’re helping out when they give money
When considering possible nonprofit revenue streams, peer-to-peer fundraisers play a key role.
Peer-to-peer fundraising is when donors donate directly to your organization, rather than giving through a traditional fundraiser like a telethon or charity auction. This can take place in person or online, but it’s most commonly done through social media platforms like Facebook and Twitter.
To set up a peer-to-peer fundraising campaign:
- Set up an account on either GiveForward or GoFundMe (or both). These websites offer free tools for you to create personalized donation pages where people can choose which cause they want to support. They’ll also help you collect donations from donors who choose not to give online, such as those who prefer sending checks instead.
- Create content around the campaign with creative images and videos that highlight how much good work your nonprofit does in the community. Share these posts on social media platforms where people who might want to donate are likely already spending time online — Facebook groups related to causes that align with yours would be ideal places for this kind of outreach because those kinds of groups tend not only have members interested in supporting nonprofit organizations but also some influence over potential donors themselves!
Every nonprofit, regardless of size or mission, can benefit from government funding. In fact, it’s a great way to generate revenue and potentially have a larger impact on the community. What is government funding? Government funding is money given by a local or federal agency for projects that support their mission. Many organizations also use it as a way to test out new ideas before investing in more robust solutions.
How do I apply for grants? There are several types of grants available:
- Research grants—these are offered by universities and colleges who want to fund research projects that will advance scientific knowledge in their fields (e.g., cancer research)
- Developmental grant—this type of grant provides funding for startups that need help getting off the ground (e.g., start-up tech companies)
- Special project grant—this type of grant provides financial support for very specific needs that fall outside those normally covered by regular budgeting procedures but still align with organizational goals (e.g., creating an after school program at a local elementary school)
A sponsorship can be a great revenue stream, especially now when for profit businesses focus on corporate social responsibility.
A sponsorship is an agreement between you and a company to get their name in front of your audience. The company offers this financial support, usually in exchange for a mention in an email newsletter or social media post.
This can be a great way to increase your nonprofit’s revenue because it can be less expensive than other forms of advertising, and it’s more targeted. You’re only showing the sponsor’s name to people who care about your cause, so they’re more likely to donate or become members than if they saw ads on TV or billboards.
Plus, sponsorships are win-win situations: both parties benefit from working together—the nonprofit gets money and exposure, while the sponsor gets some good PR.
Nonprofit accounting software can be a vital tool for your organization. It will help you track donations, grants, and endowment funds. The software can also help you keep track of your overall nonprofit income, as well as expenditures.
Nonprofit accounting software can help you track your expenses so that you don’t overspend during the fiscal year or take money from one area of operations when it should go to another area instead. It is easy to use and helps prepare nonprofits for tax season by providing a snapshot of their financial health at any time during the year (or even before).
Now that you are able to diversify your nonprofit revenue streams, it is important to also be able to manage your nonprofit income. Thankfully, Zivo will offer you tremendous help through its virtual CFO services. You save time and money, while we take care of the entire process.
Book a free consultation with Zivo if you need a Canadian professional to look over your finances before you decide whether to proceed with a CFO or on your own!
add a link to Improve Your Nonprofit Cash Flow With the Assistance of a CFO! when published
add a link to “X Financial Metrics That Impact Social Enterprises the Most” when published 🙂