Jul 2, 2013
Nonprofit organizations need to know how to not only start a successful fundraising program to spread cause awareness, but also make their efforts and the organization itself sustainable. Taking on new avenues of funding, such as implementing an online donation request feature on the company website, is only possible if charitable foundations have the money to do so. A recent study showed that even though the nonprofit sector has grown a considerable amount over the past 30 years, only about 1 percent of organizations have reached $50 million or more in revenue. This is a striking number, but when thinking about why so many are not succeeding, there is one important factor to keep in mind.
The Stanford Social Innovation Review supplied statistics from the 2012 Bridgespan Group study that analyzed why nonprofits aren't growing more, stating that more than 200,000 organizations were started between 1975 and 2008, but only 201 were able to reach the $50 million mark. The study recognized four themes as to why so few made the mark: single-engine growth as bigger organizations concentrate their fundraising to one tactic; heavyweight stability that includes government funding with grants and fees; magnet fields, meaning the bigger nonprofits were in either international or global development or health care and human services; and big bettor philanthropy that used foundation funding.
The big players were able to target and tackle specific funding and nonprofit sectors that gave them a definitive source of monetary support. Harvard Business Review said that the reason why a lot of smaller organizations aren't able to grow to a multi-million dollar venture is because they simply aren't as knowledgeable as they could be and are therefore unaware of how to approach their funding efforts. Research, smart leaders and a defined plan of attack are the keys to success.