Learn about revenue streams for nonprofits electricity merit badge pamphlet

Corporate social responsibility (CSR) has become more important as consumers have become more likely to buy from socially responsible companies. Corporate funding can be a long-term commitment to certain causes and the charities connected to them, or it can be more episodic and market-driven, revolving around particular campaigns, events, and projects. Funding from corporations can be a good source of support for new initiatives, special programs, and special events.

Nonprofits increasingly look for opportunities to form corporate partnerships for sponsorships and cause-related marketing. Companies also often help their employees give to charities and even match those contributions. Employee volunteer programs are popular, and some grants are tied to employee volunteer hours. Federal, State, and Local Governments

Many nonprofits benefit from all levels of government. Prominent examples are public education, higher education, and the public media. Federal, state, and local government grants fund many programs provided by nonprofits, especially for human service and healthcare. Grants.gov provides up-to-date information and a directory of federal grants. Federated Funds

Federated funds have traditionally thrived because they supported employee giving at companies. Today, they have become less popular as new ways of employee giving have been established and as younger donors, such as millennials, seek to be more involved with the charities to which they give. Grant-Making Public Charities

Public charities are a cross between a private foundation and a charity. They typically receive funding from the general public, government, and private foundations. They may perform public service, but primarily raise funds and provide grants to other nonprofits that provide direct service.

You can find many such grant-making public charities in your local area. Some are linked to a national organization; the Junior League is one such example. Grant-making public charities file IRS Form 990, so information about them can be found in many databases, such as at the Foundation Center and GuideStar. Foundations

Family foundations receive endowments from individuals or families. Many large family foundations have been around a long time and become household names. Think of the Gates Foundation, the Rockefeller Foundation, and the Ford Foundation. Numerous family foundations have endowments in the billions, but most family foundations are much smaller, tend to fund locally, and often have little to no professional staff. These types of foundations usually give money to their hometown charities.

Community foundations are public foundations that pool the assets of many donors. They work to improve their local communities through grantmaking, awarding scholarships, and providing services to donors. Community foundations have become very active in providing donor-advised funds for donors who want to become more purposeful in their giving but don’t want to set up their own private foundations. Community foundations today often organize giving days to help local nonprofits raise funds.

• Recurring support usually comes through programs and activities such as the Annual Fund. An annual fund means just that—annual (or more frequent) appeals to a core group of constituents. Such funds are usually unrestricted—available for any use—and may represent a significant percentage of a nonprofit’s annual income.

• Sales of Products and Services. Some nonprofits own stores or provide services that can represent a substantial income stream. The Girl Scouts is one obvious example with its annual sale of cookies, and Goodwill Industries is probably the largest nonprofit retailer. A symphony or theater earns income through the sale of tickets. However, earned income must be related to the mission of the organization, or it can be taxed as unrelated business income.

• Endowment Income. Many large nonprofits, particularly higher education institutions, and healthcare organizations build up large endowment funds that produce interest that supports their programs. Episodic funding may come from a foundation or corporate grants, special events, or a bequest. These funds may be restricted or unrestricted.

Capital campaigns have a beginning and an end but often span several years. A capital campaign employs all the usual means of raising funds such as direct mail and direct solicitation. Capital campaigns require extensive preparation and skillful execution.

Most nonprofits now have planned giving programs that help donors include their favorite causes in their wills or estate planning. The charitable gift annuity has become quite popular among many donors as it allows tax advantages while providing income during the donor’s lifetime.