Explore Grants
Whether awarded by local or federal government, grants are often underutilized resources that can empower nonprofits and bolster their budgets. When you consider that 92% of nonprofits operate with less than $1 million a year, and 88% spend less than $500,000 annually, it’s not hard to imagine the impact that a cash infusion from a sizeable grant could make on an organization and ultimately on the people or cause it serves.
While grants are a great resource, grant writing is no walk in the park. Applications are time-consuming and labor-intensive. In the end, there is no guarantee that the funds will be awarded. Then, you must consider that grants are typically designed for specific purposes that must be appropriately reported.
However, the benefits of grant funding outweigh the heavy lift they typically require. In addition to the impact that a significant amount of funds can make on a budget, government agency grants lend authority to nonprofits. This can create a domino effect and make bringing in funding from other sources easier.
Be proactive in exploring grant opportunities, especially those that were previously awarded but have now become available. Sites such as grant.gov, Foundation Directory Online (FDO) Free, and GuideStar are phenomenal resources for finding grants your organization could apply for and win.
Factor in Earned Income
Nonprofits typically underestimate their ability to earn income from product or service sales. As an executive who worked in the corporate sector for two decades before coming to KOTM, I believe we can use for-profit organizations’ expertise, strategies, and sound business practices in the nonprofit sector. The result is not profit for the sake of profit but increased resources to make a bigger impact.
Developing steady earned income streams of revenue requires an entrepreneurial mindset, which can feel uncomfortable for a nonprofit leader. But the alternative for many is to become one of the stats we have seen and join almost half of organizations that do not make it to the ten-year mark.
Sell Products or Services
While everyone loves a well-designed hat with your organization’s logo, don’t limit your scope when considering the products or services your organization could offer.
1. Offer Classes
Provide education that is connected to the cause you serve. For example, if your organization focuses on preserving local wildlife, provide classes on gardening with native plants that will foster the local ecosystem’s health.
2. Solve a Problem
This could be anything from software you have developed to make your reporting or tracking easier or a product that eliminates a challenge in your industry.
3. Develop Merchandise
Merchandise can be more than a t-shirt. For example, Thistle Farms, based in Nashville, TN, helps “women survivors recover and heal from prostitution, trafficking, and addiction.” As part of the program, the women are employed and trained to make body care products, candles, jewelry, and more.
Additionally, the organization runs a successful local cafe that the community can frequent. When people purchase these products, they are bringing home lovely organic products every time they use them. Supporters know they support the healing, education, and long-term success of the women behind them.
4. Do Your Homework
When developing your own, do market research and be as objective as possible, increasing your likelihood of sales. When for-profit organizations evaluate the potential profitability of a product or service, we first ask if it is solving a problem and, second, how it is unique.
By doing so, we mitigate the risk associated with start-up costs and increase the likelihood of the products or services’ success.
Billing Private Insurance
Organizations that serve in a medical capacity should consider billing private insurance for the portion of the service covered by the client’s plan. This is an excellent fit for organizations such as a Mercy Community Health in Tennessee, a medical clinic that serves the underinsured as part of their clientele. We have also done the same at Kids on the Move, where we provide speech therapy, occupational therapy, early intervention services, applied behavior analysis, and more. Some Medicaid programs are also available to help offset the cost of these necessary therapies.
While the initial setup required for billing and forecasting staffing and finances is admittedly a heavy lift, once accomplished, billing private insurance can become a steady and reliable source of income that can increase your operating budget.
In the past four years, because of the demand for comprehensive services and families wanting more services from an organization they know and trust, we have doubled our operating capital and the additional funds to help subsidize our grand funding and increase staff compensation.
Repurpose Your Resources
Never underestimate the power of repurposing the resources around you to generate income. For example, if your organization has a beautiful campus and, better yet,an auditorium with a full AV package, consider renting it out to a local dance studio, theatre troupes, or other organizations that require a place to host events or performances. Along those lines, promoters of touring concerts are often looking for venues of various sizes that can accommodate their artists and their fans for a night.
When hosting events, which we’ll talk about shortly, don’t just stop at selling tickets. Consider reaching out to local businesses and selling sponsorships. Businesses have marketing budgets set aside, and if they can also use those budgets to serve a great cause they believe in, it is all the better.
When they purchase a sponsorship at your event, it practically guarantees that every attendee will be exposed to their brand, which is a much better return on investment than what many other platforms promise.
Donations Reimagined
Donations, you may think we are walking into familiar territory here, but I want you to look at the stream with fresh eyes. A 2019 study showed that 69% of nonprofit funding comes from individuals, and seeing as individuals gave more than 319 billion dollars in 2023, it’s not to be discounted.
Unfortunately, when nonprofits rely so heavily on individuals, they are often left with a constant need to fundraise, typically from the same group of dedicated people. This, combined with the uncertainty of whether people will contribute, makes it difficult for any organization to operate efficiently.
1. Foundation Giving
Foundations giving is the second largest funding source, donating over 105 billion dollars in 2023. Foundations are nonprofit entities usually established by families, corporations, or a community of donors. They often have a particular focus they donate towards, such as a demographic of people, a certain cause, or a specific purpose, such as research.
Foundations typically donate in the form of grants. Unlike government grants, they are normally easier to apply for, and there is much less competition. It should be noted that they are also smaller in size, but if you meet the foundation’s minimum requirements, they could be a great source of funding.
2. In-Kind Donations
Resource Recycling. In-kind donations in the form of resource recycling is an excellent way for your organization to save money and engage with the community, which can potentially lead to monetary donations. For example, local grocery stores that cannot move products by a sell-by date can donate them to food pantries or shelters.
Donated cars can then be given to clients for reliable transportation or sold for parts, and gently used furniture is repurposed by organizations like Habitat for Humanity. When looking at your budget, explore ways to explore resource recycling without sacrificing excellence and, in the process, free up portions of your budget for other uses.
Volunteers. While any nonprofit organization will recognize volunteers as crucial for special events or small tasks, volunteers are often underutilized resources. Recent studies show that volunteers donate about 4.9 billion hours annually for a total value of $122.9 billion every year.
Evaluate where you could utilize volunteers more effectively in your organization. Think of it this way, every hour a volunteer donates is an hour a paid staff member is freed up to work towards another goal, maximizing the impact your organization can make.
Every year at KOTM, almost 3,000 volunteers give their energy, passion, and over 10,000 hours of their time. And while we have calculated the monetary value this has brought to our organization, it goes without saying that the thoughtfulness, love, and expertise they bring to their roles are priceless.
We see their impact on our clients, their parents, and our team members every week, and we simply could not do our work without them. Additionally, they are some of our greatest advocates in the community, bringing in new supporters every day.
Live Events
Despite having a proven track record of generating significant funds, events are yet another underutilized funding source for nonprofits. When hosted annually, events like galas, 5k runs or walks, silent auctions, concerts, and sports tournaments are fantastic ways to connect with donors and raise funds.
Allowing you to predict a surge of income at specific times of the year. However, there is more value to these events than just fundraising; they are a way to connect with donors face-to-face, allow new people to discover your organization, and create a sense of unity in the community.
These experiences are often incredibly meaningful for the attendees, and as a result, they create short and long-term benefits. This will allow your organization to elevate its brand, foster deeper relationships, and inspire donors to get more involved. When done right, they are a strategic move for sustainable revenue.
Social Media Campaigns
Social media can be an incredibly effective fundraising tool for raising donations. Many people remember when the Ice Bucket Challenge went viral in 2014, raising money for ALS, and every November, it’s easy to spot a little extra facial hair in support of No Shave November. The social media-born trend stems from Movember, which raises millions of dollars for men’s health organizations.
While these viral moments are great examples of the power of social media, they are the exception, not the rule, to fundraising on social media. So, what does yield results when it comes to social media campaigns? I’m so glad you asked.
1. Like, Know and Trust
People work or partner with organizations they like, know, and trust. Whenever you create a post on social media, respond to a comment, or repost a piece of content you are tagged in, you build the like, know, and trust factor. Create content that is authentic to your mission and gives people an inside look and a chance to get to know you.
2. Foster Engagement
Long before the first time you ask your followers to donate to social media, you should be making small calls to action that foster engagement. People often assume their audience will automatically engage with their content when, in fact, they need to be coached. Small calls to action can include asking them to comment, prompting them to answer a poll, or leaving a question for a Q&A, which you’ll answer later.
3. Be Consistent
Consistency is key when it comes to social media. Create a schedule that you feel is manageable and commit to it. Not only is it essential for your audience to show up in their feeds consistently, but most platforms have an algorithm that rewards accounts that post routinely.
Organizations such as The Innocence Project, Wags & Walks, and Mission44 are all amazing examples of organizations that consistently post engaging content that build the like, know, and trust factor. When you have all three of these elements as the foundation of your social media strategy, you’ll be poised to have a successful fundraising campaign with an audience that is excited about your work and ready to give.
Don’t Put All Your Eggs in One Basket
When it comes to nonprofit income, the age-old adage is true: you don’t want to put all your eggs in one basket. Similar to a for-profit business, it’s vital to remain innovative, creative, and diversified regarding funding sources.
A diversified strategy can stabilize your budget, preventing service disruptions if one funding stream slows down for a season. The additional resources can also empower you to serve your mission better and create a bigger impact.
While diversifying may sound daunting, remember—we’re playing the long game. Don’t let your nonprofit become another statistic. Building a strong, sustainable foundation takes time but is worth every step. Start small, take consistent action, and stay focused on your “why.”
You’re not just securing funds—you’re securing the future of your mission, the lives you touch, and the change you create.
