Ask HN: How to get money for running a non-profit project?
I have created a non profit project for ease of governance. There is no business model. I do i scale it and keep it running? Any other options than donations?
44 comments
I can mention my own: http://www.littlecaution.org
I'm in the process of teaching the general public, including schools, colleges, the aged, etc. about remaining safe and secure on the internet. One of the engagements was when somebody I knew heard about it at a corporate and called me in to educate a large batch of new joinees from colleges. Next up: administrative staff in the office buildings and also employees. Though I'm funding it entirely from my own pocket now, based on the conversations I've had, I think companies will be willing to support it in the future - not to a level of profit, but to keep it running and so that I can pay experts for more their time and more content. I hope that will also cover the expenses when we do workshops at poorer schools and apartments and for senior citizens, where it is going to be entirely free for the attendees.
I also added a bitcoin and ethereum donation address recently. I've got nothing from it yet, but maybe you can try that also.
I also added a bitcoin and ethereum donation address recently. I've got nothing from it yet, but maybe you can try that also.
That's an excellent project - thanks for all your hard work!
Somebody just sent in 0.01BTC. Yaaay! That's a first. Thank you!
Running the project on donations IS a business model.
One option is to create a business model, run it like a business, a way of running a non-profit is to just spend all the revenue on the business' goal, rather than to pay the shareholders of the business.
I think thats the most robust way to insure longevity of the enterprise. Relying on donations to keep the lights on is difficult.
I think thats the most robust way to insure longevity of the enterprise. Relying on donations to keep the lights on is difficult.
> Relying on donations to keep the lights on is difficult.
Can confirm - the Hackerspace I help run is in big part funded by company donations. Every now and then comes the day when I have to convince someone to keep donating, and since result depends mostly on the goodwill of the other party, we have to play safe with finances - which slows the growth and acquisition of new useful workshop tools.
We're trying to move to self-sustainable model, but with almost everyone having a day job and/or a significant other, it's damn difficult.
Can confirm - the Hackerspace I help run is in big part funded by company donations. Every now and then comes the day when I have to convince someone to keep donating, and since result depends mostly on the goodwill of the other party, we have to play safe with finances - which slows the growth and acquisition of new useful workshop tools.
We're trying to move to self-sustainable model, but with almost everyone having a day job and/or a significant other, it's damn difficult.
Some things you might consider for becoming more self sufficient:
-Membership dues -Vending machine with useful supplies -Locker / storage space rental -Government grants for larger purchases
A community workshop I used to go to had great success with this. There were two membership types, drop-in and keyholder, with different monthly dues and perks. That was enough to be self sufficient and make routine equipment purchases. When they needed to make a big purchase, like a dust and fume extractor system, they got a grant for between $5000-20000 from the local government.
-Membership dues -Vending machine with useful supplies -Locker / storage space rental -Government grants for larger purchases
A community workshop I used to go to had great success with this. There were two membership types, drop-in and keyholder, with different monthly dues and perks. That was enough to be self sufficient and make routine equipment purchases. When they needed to make a big purchase, like a dust and fume extractor system, they got a grant for between $5000-20000 from the local government.
I'm in the process of trying to get a makerspace in my area off the ground - any chance you can give some insight as to how you approached companies for donations? We've got dues-paying members who want to get this thing going, and are working with a local tech school to try to get some space on their campus, but I feel like large-donations is what we're really lacking and we're just not sure of who to approach or how to do so.
Hi, President of SparkCC (sparkcc.org) in Australia here.
First I suggest you take a look at the hackerspaces.org Design Patterns (https://wiki.hackerspaces.org/Design_Patterns), particularly the Independence and Sustainability patterns. Relying on donations is following the "Sponsoring Anti-Pattern".
I've seen a lot of not-for-profit groups who end up on the "grant cycle". The spend a bunch of time applying for various grants or soliciting donations just to survive. Once one grant/donation is secured it's time to start chasing the next one. Instead of spending time working in the 'space and making things.
You say you have paying members already which is great - this is the key to real sustainability. Perhaps you could follow the Charitable Member Pattern and see if they would be able to pay their entire year up front to get the space off the ground?
Starting a makerspace has been one of the most satisfying and worthwhile things I've done and I highly recommend sticking at it and making it work. I wish you good luck!!!
First I suggest you take a look at the hackerspaces.org Design Patterns (https://wiki.hackerspaces.org/Design_Patterns), particularly the Independence and Sustainability patterns. Relying on donations is following the "Sponsoring Anti-Pattern".
I've seen a lot of not-for-profit groups who end up on the "grant cycle". The spend a bunch of time applying for various grants or soliciting donations just to survive. Once one grant/donation is secured it's time to start chasing the next one. Instead of spending time working in the 'space and making things.
You say you have paying members already which is great - this is the key to real sustainability. Perhaps you could follow the Charitable Member Pattern and see if they would be able to pay their entire year up front to get the space off the ground?
Starting a makerspace has been one of the most satisfying and worthwhile things I've done and I highly recommend sticking at it and making it work. I wish you good luck!!!
We had some success with:
- IT companies
- electronics companies (one of which is our current regular donor)
- local angel investors
- government grants (we did a series of workshops for a project run by the US embassy in Poland)
Two other options we're also exploring:
- various grants, both government (national and EU) and from company-backed nonprofits
- CSR - big companies tend to have money allocated to spend on non-profit causes because of their Corporate Social Responsibility programs; you can try and apply to those
As for how we approached companies: we mailed them directly, describing what we're doing. We created a nice PDF brochure to be attached with details and photos. However, the best results came from something else - some of our members talked about our Hackerspace at work, and the word reached their employers, who then reached out to us.
- IT companies
- electronics companies (one of which is our current regular donor)
- local angel investors
- government grants (we did a series of workshops for a project run by the US embassy in Poland)
Two other options we're also exploring:
- various grants, both government (national and EU) and from company-backed nonprofits
- CSR - big companies tend to have money allocated to spend on non-profit causes because of their Corporate Social Responsibility programs; you can try and apply to those
As for how we approached companies: we mailed them directly, describing what we're doing. We created a nice PDF brochure to be attached with details and photos. However, the best results came from something else - some of our members talked about our Hackerspace at work, and the word reached their employers, who then reached out to us.
What does growth mean in the context of a non-profit? Is it really a meaningful metric?
Everyone needs to measure success somehow, and increasing your performance against that metric (which is often linked with growth) is good. I worked with a non-profit for a while where each member was asked to track performance against goals. It was often repeated, "it's not about the numbers." No, it's about the people you're serving, but the numbers represent people and serving more people is better. What's wrong with trying to do that? It doesn't have to come at the expense of forgetting the people behind the numbers.
In the context of our space - more tools, more people coming to use those tools, learn and build awesome stuff.
It is a meaningful metric because it's our whole raison d'être - providing free access to more and more advanced workshop for building stuff and learning new skills.
It is a meaningful metric because it's our whole raison d'être - providing free access to more and more advanced workshop for building stuff and learning new skills.
Number of people using the service seems like a good metric.
"Relying on donations to keep the lights on is difficult."
You just have to plaster a giant banner ad of your puppy dog face, begging for donations at the top of every article. Works for Jimmy Wales.
You just have to plaster a giant banner ad of your puppy dog face, begging for donations at the top of every article. Works for Jimmy Wales.
Would probably need more information about what your project is exactly and what your actual non profit status is, as it will change how easy it is to get various sources of income and your eligibility.
Widely speaking, the three likely sources of income I can think of are
(1) People - either donations / patronage, or in return for something - you'll likely have more success with this if you provide regular benefits or at least token value in return for them.
(2) Grants from some community grant organisation, for example in Western Australia the Lotterywest lotto company gives out a large sum of grants as part of their license - but there may be other grant sources including private or government - eligibility will likely depend on your mission and actual status as a non profit and/or charity (these two things differ in Australia, no idea about other countries.. I think the US has some weird 3rd "public benefit" category)
(3) Find a home under the umbrella of some other already funded organisation that takes additional projects under it's wing, things like the Apache Software Foundation, GNU, etc. (no guarantee you'll actually get funding, but it may be possible in some cases.. some foundations may help you out legally but not with funding).
Grants are often hard work and come with various requirements, and are often even best case some chance of winning if you compete against others. And hard to maintain long term, so is more suited to short term. In most cases it is unlikely you'd get regular grants over time and there's definitely a time burn even if you can.
Some kind of patronage or regular output getting donations from people generally is easier to have recurring but actually getting a notable number of patrons/donations on a regular basis is difficult. Often not too bad once established.
Lastly a home under a foundation is likely difficult for a new project.. so in that case likely you'd need to self-fund until the point that may be possible.
Hope that helps.
Widely speaking, the three likely sources of income I can think of are
(1) People - either donations / patronage, or in return for something - you'll likely have more success with this if you provide regular benefits or at least token value in return for them.
(2) Grants from some community grant organisation, for example in Western Australia the Lotterywest lotto company gives out a large sum of grants as part of their license - but there may be other grant sources including private or government - eligibility will likely depend on your mission and actual status as a non profit and/or charity (these two things differ in Australia, no idea about other countries.. I think the US has some weird 3rd "public benefit" category)
(3) Find a home under the umbrella of some other already funded organisation that takes additional projects under it's wing, things like the Apache Software Foundation, GNU, etc. (no guarantee you'll actually get funding, but it may be possible in some cases.. some foundations may help you out legally but not with funding).
Grants are often hard work and come with various requirements, and are often even best case some chance of winning if you compete against others. And hard to maintain long term, so is more suited to short term. In most cases it is unlikely you'd get regular grants over time and there's definitely a time burn even if you can.
Some kind of patronage or regular output getting donations from people generally is easier to have recurring but actually getting a notable number of patrons/donations on a regular basis is difficult. Often not too bad once established.
Lastly a home under a foundation is likely difficult for a new project.. so in that case likely you'd need to self-fund until the point that may be possible.
Hope that helps.
We run Security First as a non-profit.(https://www.secfirst.org). I also helped setup an UK charity called Videre (https://www.videreonline.org). It really depends on what you are doing. We build technology and training to help activists, journalists and people in high risk areas manage their security - through our free, open source mobile app, Umbrella. So we found and apply to funders who provide grants to help us build this. Public donations are actually quite a hard business model for non-profits as it really requires a huge amount of public visibility and work to keep them coming in. I recommend looking for grants first of all. I know the space pretty well so feel free to drop me a mail to the email in my profile and I'm happy to share some thoughts!
Will like to talk more about it. Can you please share your email.
Cool, click on my username in HN and it's in there.
I'm in the process of doing this right now (we're in the 'fake news' space). Google is your friend, there are a multitude of resources out there for nonprofits.
In terms of how to get going, here are a few useful links:
First, a feasibility study: http://help4nonprofits.com/NP_START_IsItFeasible_Art.htm
Next, a board: https://www.thebalance.com/importance-of-nonprofit-first-boa...
In terms of how to get going, here are a few useful links:
First, a feasibility study: http://help4nonprofits.com/NP_START_IsItFeasible_Art.htm
Next, a board: https://www.thebalance.com/importance-of-nonprofit-first-boa...
I'm working on a project that is related to fake news too. I'd be curious to learn a little more about what you are doing.
Ditto. I think there are a lot of people interested in the online disinformation problem at the moment.
Drop me an email, my username here at the big g mail co.
This repository gives a nice overview of existing financing solutions with some pros/cons. It's oriented towards open source projects, but this doesn't mean it can't apply for other kind of projects.
https://github.com/nayafia/lemonade-stand
https://github.com/nayafia/lemonade-stand
You could apply for Shuttleworth Foundation fellowship program that open the fellowship application twice a year.
https://shuttleworthfoundation.org/
https://shuttleworthfoundation.org/
SF projects should be about promoting openness though, so if "ease of governments" also means "making the government more transparent", that might be an option.
Honestly, treat a non-profit just like a for profit. Way too many non-profits rely on a hodge podge mix of grants and donations. These non-profits have incredible trouble scaling because they can never rely upon any sort of cash flow. If you treat a non-profit like a business and figure out a recurring revenue stream, you will be way ahead of the game.
And, as an added bonus, much like in the for profit world, once your non-profit shows that it can sustain itself indefinitely, you'll have people/foundations/other organizations coming out of the woodwork to fund you!!
And, as an added bonus, much like in the for profit world, once your non-profit shows that it can sustain itself indefinitely, you'll have people/foundations/other organizations coming out of the woodwork to fund you!!
The Foundation Center is a fantastic organization dedicated to the education of non profit orgs and fundraising. They have a really nice library in NYC too. Lots of resources on these topics:
http://foundationcenter.org/find-funding
http://foundationcenter.org/find-funding
There is no business model.
Is there no business model, or is there no business model yet?
As Google demonstrated, there are plenty of investors ready to invest in companies which have no clear business model providing that they're doing something which could theoretically be turned into a business eventually.
Is there no business model, or is there no business model yet?
As Google demonstrated, there are plenty of investors ready to invest in companies which have no clear business model providing that they're doing something which could theoretically be turned into a business eventually.
There is no business model as far i can see. The project is a catalog of government data aggregated together.
Not a direct answer, but Max Ogden talked about that a bit on Changelog's RFC: https://changelog.com/rfc/6
In the USA just because your a non profit doesn't mean you cannot charge money for your product.
As an example, there are lots of non profit hospitals that charge for a product but don't seek to make a profit.
Would people pay for your product?
As an example, there are lots of non profit hospitals that charge for a product but don't seek to make a profit.
Would people pay for your product?
To my knowledge, the number of non-profit hospitals is definitely getting smaller. This can affect the amount of indigent care significantly. I've heard of for-profit hospitals that cut maternity/OB-GYN services because the number of non-paying patients giving birth cut into their bottom line significantly.
Why not monetise in a traditional way? Non-profit doesn't mean non-revenue - just reinvest the profits a la Ghost for example.
It totally depends on the topic of your project and the finances needed. And what do you want to scale?
Earn the money needed from other, for-profit project.
make some important project that other companies depend on in their projects and they will pay you to continue developing and maintaining it.
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Just make the project. This modern obsession that free software has to be 'funded' and 'governed' is absurd. Free software works far better when money is not a factor.
Sorry, but that sounds like you have never actually 'governed' an OSS.
I assume you mean 'a free software project' rather than 'an OSS'.
Well no, that's my point. Free software projects don't have governors, they have maintainers. They don't have non-profits and boards and diversity quotas and codes of conducts, they have mailing lists and BDFLs and coding standards and banhammers.
This politicisation and corporatisation of free software is not good for free software.
Well no, that's my point. Free software projects don't have governors, they have maintainers. They don't have non-profits and boards and diversity quotas and codes of conducts, they have mailing lists and BDFLs and coding standards and banhammers.
This politicisation and corporatisation of free software is not good for free software.
Free software has been a political statement from day zero.
Only if you have an absurdly broad definition of politics.
Stallman has been pretty clear on the political nature from early on. What gives you the impression that free software hasn't been political? Perhaps there's a difference in definition of free software.
With GNU, and the Free Software Movement, the Free is definitely free as in freedom, which is a political concept.
From the Free Software Movement:
https://www.gnu.org/philosophy/free-sw.html
The four essential freedoms
A program is free software if the program's users have the four essential freedoms:
The freedom to run the program as you wish, for any purpose (freedom 0).
The freedom to study how the program works, and change it so it does your computing as you wish (freedom 1). Access to the source code is a precondition for this.
The freedom to redistribute copies so you can help your neighbor (freedom 2).
The freedom to distribute copies of your modified versions to others (freedom 3). By doing this you can give the whole community a chance to benefit from your changes. Access to the source code is a precondition for this.
A program is free software if it gives users adequately all of these freedoms. Otherwise, it is nonfree. While we can distinguish various nonfree distribution schemes in terms of how far they fall short of being free, we consider them all equally unethical.
From the GNU Wikipedia page:
https://en.wikipedia.org/wiki/GNU
Richard Stallman, the founder of the project, views GNU as a "technical means to a social end". Relatedly Lawrence Lessig states in his introduction to the 2nd edition of Stallman's book Free Software, Free Society that in it Stallman has written about "the social aspects of software and how Free Software can create community and social justice."
That sounds pretty political to me.
With GNU, and the Free Software Movement, the Free is definitely free as in freedom, which is a political concept.
From the Free Software Movement:
https://www.gnu.org/philosophy/free-sw.html
The four essential freedoms
A program is free software if the program's users have the four essential freedoms:
The freedom to run the program as you wish, for any purpose (freedom 0).
The freedom to study how the program works, and change it so it does your computing as you wish (freedom 1). Access to the source code is a precondition for this.
The freedom to redistribute copies so you can help your neighbor (freedom 2).
The freedom to distribute copies of your modified versions to others (freedom 3). By doing this you can give the whole community a chance to benefit from your changes. Access to the source code is a precondition for this.
A program is free software if it gives users adequately all of these freedoms. Otherwise, it is nonfree. While we can distinguish various nonfree distribution schemes in terms of how far they fall short of being free, we consider them all equally unethical.
From the GNU Wikipedia page:
https://en.wikipedia.org/wiki/GNU
Richard Stallman, the founder of the project, views GNU as a "technical means to a social end". Relatedly Lawrence Lessig states in his introduction to the 2nd edition of Stallman's book Free Software, Free Society that in it Stallman has written about "the social aspects of software and how Free Software can create community and social justice."
That sounds pretty political to me.