How to start a nonprofit

You have this incredible idea to start a school for low-income students in your community. You see that there is a strong need for this type of work as the education system seems to be failing those who are underprivileged in your town. You finally decide to quit your job and go all-in on starting this nonprofit organization. But, where do you even begin?

First and foremost, if you want to start your own nonprofit organization, you need to know from the outset that it is going to take a tremendous amount of time, energy, commitment, and dedication to get your idea off of the ground and into a functioning nonprofit organization. The legal paperwork is a lengthy process and finding the funding can take quite a bit of time and effort as well. If you have an idea, we recommend that you start by doing a bit of digging on whether any type of organization - similar to the one you have in mind - already exists. If one does, then you should contact them and find out how you can help out or collaborate with that specific organization. However, if you can’t seem to find any organization like the one you're envisioning, and you feel compelled to start your own, here is a simplified step by step guide on how to start your own nonprofit organization!

You might ask: “What exactly, in legal terms, defines a nonprofit organization?” This is a common and frequent question among ambitious individuals who want to start their own organizations. A nonprofit is defined by the IRS as an organization that is operated exclusively for religious, charitable, scientific, testing for public safety, literary, educational, or other specified purposes. This organization must operate and provide its services without the primary goal of making money. While there are many different classifications for charitable organizations, most individuals who find themselves starting their own nonprofit organizations will likely file to become a 501(c)(3). This specific classification enables your organization to be tax exempt under the Internal Revenue Code. However, you should worry about the legal paperwork after you’ve laid the foundation for your nonprofit. Here’s where you should start:

1. CHOOSE A NAME - As you begin the process of starting your nonprofit, the first step is choosing a name. You have a general idea of what your nonprofit will be doing and who you will be serving. Now, here’s the fun part! Come up with a name that encapsulates the goal of your mission!
2. CREATE A MISSION STATEMENT - Once you have a name, then you need to create a mission statement. You know what your mission is, but here’s the tricky part: you need to condense your mission into one or two short sentences that fully encapsulates your goals. Make it clear and concise, but also make it unique to your organization. These one or two sentences should clearly differentiate your nonprofit organization from others that already exist. 
3. DETERMINE YOUR VISION - After creating your mission statement, you should take time to vision where you’d like your organization to be in ten years. What is the grand plan? While you may not have all the answers at first, this is a good place to start. Then, you can work backwards. You should ask yourself questions like: where do you want your organization to be in five years? In three years? In one year? Once you’ve thought through the grand vision, now it’s time to get to the tactical side of things.

CREATE A BUSINESS PLAN - After speaking to the founders of many different nonprofit organizations, I learned that the majority of them underestimated the amount of financial planning necessary to start their organization. A nonprofit operates similar to a business, but nonprofits do not generate any profits. This means that unlike a business, your nonprofit organization cannot rely on a cash flow for funding. Rather, your team will have to do a ton of work finding the money, donors, and grants necessary for operation. As a result, you need to create a detailed business plan where you set up a road map for the next 3 to 5 years of work. Here is a breakdown of a business plan:

• The first part of your business plan should be the executive summary. In this section you need to define your nonprofit organization’s mission and purpose.
• The second section should describe the programs and services that your nonprofit will offer. In this section, you should specify how your programs and services will create a positive change in your community and who the beneficiaries will be.
• Next, you should create a detailed marketing plan. In this section you should describe how you will get the word out about the work you will be doing. A successful nonprofit organization has a strategic marketing approach. This not only brings awareness to the organization, but it also engages potential donors and volunteers. How will you leverage social media to communicate your mission?
• Create a detailed operational plan. What will your day to day operations look like? Define your organizational structure and establish what each role will accomplish.
• Here is where you have to put your math cap on. You will need to create a thorough financial plan that will help guide your first few years of operation. Come up with an estimate of what it is likely going to cost to get your organization running. While you may not have the financial background, do your own research, and reach out to people who do have the background and would be willing to help you.

After you have the name, mission, and general business plan, the next step is to build a strong and motivated leadership team. The key to success within a nonprofit organization is good people. You need a board of members who are dedicated to the mission and have the knowledge, insight, and connections able to get your nonprofit off the ground. You need a dedicated staff that will work on the operational side of things. Most importantly, you will need to recruit volunteers who have a passion for your mission and are willing to donate their time and money. 
Once you have the foundation set in place, then you will need to apply for a 501(c)(3). The process is unfortunately not as simple as filling out the paperwork, submitting it, and getting the stamp of approval. In fact, it can take 3 months to over a year to get a response from the IRS. But once you have the official 501(c)(3) stamp of approval, your organization is no longer an idea, and it is now an official nonprofit organization.
While the process of becoming a nonprofit organization is a time consuming and oftentimes complicated process, this simple guide can get you started and headed in the right direction. Glenaan O’Neil, founder of Lone Star Victims Advocacy Project, has a great piece of advice for individuals starting their own a nonprofit organization: “Understand that most times when you ask someone a question or ask them to do something, you're probably going to get a no, but be ready to follow that up with ‘Well who else do you think I should ask?’”. The process of becoming a functioning nonprofit is a marathon, it's not a sprint. It is going to take a lot of work from a lot of dedicated people. Be willing to ask for help, and if that individual can't help you, ask them if they can point you in the direction of someone who can.