Starting a charitable non-profit is not an easy feat, especially if you want to grow it into a sustainable and financially healthy organisation. Many fail to thrive on this journey. Why? Because just having a passion about a cause is not enough.
Just like for-profit businesses, non-profits are most at risk of failing within the first year of being set up. To help you avoid being one of them, here are the top 5 most common mistakes that new non-profits make.
1) Insufficient research and planning
Many founders either forget or fail to recognise that a non-profit is a type of business and therefore, it needs a business plan to succeed. Without a business plan, many non-profits launch without knowing enough about their competitive environment, how they will fund themselves or how best to market themselves. The result is not good.
2) Lack of financial knowledge
A non-profit with weak funding from the get-go is unlikely to sustain itself for long enough to get a solid fundraising programme going, yet this is another big mistake that new founders make. Many do not anticipate what it will cost to start a non-profit, they don’t know where to get the funds and they don’t lay any groundwork for an endowment fund or for a proper financial records system moving forward.
3) Unrealistic expectations of running an organisation
In their quest to do good, many founders overlook the difficulties of starting a non-profit and running it day-to-day. The process of setting one up is vigorous enough from incorporating the charity to applying for exempt status, and only when people get into the thick of it do they realise that passion isn’t always enough.
4) Not building an effective board
The first board members of a non-profit can make or break an organisation and the mistake that many founders is make is to not put an effective one together. These people should believe in your organisation’s mission and values and be willing to sell that mission to others, they should have resources, influence and a broad network so that they can open doors for you. Think about these people carefully before putting your board together.
5) Not investing in design earlier
Last but not least, is marketing. With tight budgets, founders often allocate what they do have elsewhere which leaves elements such as design to be put together by themselves last minute. This is a big mistake. Design is really important to get right from the very beginning as you need to establish an effective brand: one that is of high-quality and one that communicates the right message about what you do. Doing this yourself can come across as cheap, especially when designing your website, and it can also result in costly mistakes being made such as you communicating the wrong message with your marketing.
Start a successful non-profit
Many new non-profits fail within that first year because of problems with strategy, namely a lack of a business plan, planning for funding and creating awareness about their organisation once they have launched. Avoid these mistakes and you will already be well on your way to growing a successful non-profit!
