pic by Beo Nquyen

For the dedicated people running small non-profit organizations, the rewards can be endless.  Unfortunately, they also face many of the problems as other small business owners, namely where to find donors (money) for start-up,  growth, obtaining health benefits for their employees, finding the right bank to fit their nonprofit needs, and drafting a plan that will help them achieve their ultimate visions of the nonprofit.

The nonprofit industry is primarily financed through two main sources, government agencies and private sector philanthropy.  Both sources of these donations are heavily tied to the health of the economy, with the private donor sector being more closely tied to the performance of investment securities.  With both the economy and the major aggregate indexes (equity and fixed income) having suffered declines in the past few years, nonprofit funding has leveled off and the competition for funds among non-profits has become much more fierce.  Both government agencies and philanthropic organizations are becoming more selective in distributing funds, looking for nonprofit organizations providing a more effective use of its funds. It is a fallacy to think that bigger nonprofits are better at using the donations.  A philanthropic program for giving to make the biggest impact should think about how the focus of the donation will create an equable impact on the intended geographic area.