Do we need another non-profit?
I've been thinking a lot about the challenges facing nonprofits these days. When our political environment heats up, great people are called to action. They want to do something, and all too often, they decide that they should start a nonprofit. I wonder if sometimes the desire to start a nonprofit is rooted in the founder, not the need. While there are indeed good reasons to start new nonprofits, the model as we know it isn’t always the most efficient way to make a difference.
Philanthropic Funding Is on the Decline While total dollars raised may be increasing, the number of households giving is in rapid decline. If you dig into the trends, you’ll see that a growing portion of philanthropic dollars comes from mega-donors who give to a few causes they care deeply about. Meanwhile, moderate-income donors are giving less and to fewer organizations. This shift means that the nonprofit landscape is more competitive than ever. Small and scrappy organizations are finding it tougher to survive.
Nonprofit Board Roles Are Changing Gone are the days when a nonprofit’s board of directors was actively engaged in fundraising. Today, boards are often made up of diverse voices guiding the organization’s strategy and programming. However, fewer and fewer board members are actively involved in fundraising. Many sit on multiple boards and view their time as their primary gift to the organization. This shift places more pressure on already over-taxed and often under-trained nonprofit staff to fill the fundraising gaps.
The World of Business Is Changing The rise of purpose-driven businesses is also reshaping philanthropy. Many companies are embedding social impact into their core business models, reducing the need for separate nonprofit entities to address social issues. For some, if we buy a pair of Tom's shoes, we feel like we are being philanthropic. The rise of B Corps is also shifting the nonprofit landscape. Maybe we need to rethink many of our nonprofits and create business models or earned income strategies to support their missions.
Nonprofits Are Expected to Do More with Less Nonprofits accomplish astounding things that rival their for-profit peers, but they are often asked to do far more with far fewer resources, which limits their professional potential. Unlike businesses that can reinvest profits into growth and development, nonprofits must rely on grants, donations, and often restricted funding to sustain their work. Resources like research and marketing, competitive wages, and adequate staffing are critical to helping the most valuable nonprofits thrive. Instead of simply creating more nonprofits, we should invest in strengthening the ones that already exist.
What’s the alternative?
Before launching a new nonprofit, it’s worth asking:
Are there existing organizations already doing similar work that could use more support?
Could the impact be greater through a partnership with an established nonprofit?
Is there a way to drive change through advocacy, social enterprise, or another model rather than forming a new 501(c)(3)?
Starting a nonprofit isn’t just about passion—it’s about strategy, sustainability, and impact. If you’re feeling called to make a difference, consider other ways to channel that energy. Join an organization that shares your passion, launch a purpose-driven business, or start a project independently before committing to the complexities of nonprofit management. By being intentional and thoughtful about how we create change, we can ensure that every effort makes the biggest possible impact where it’s needed most.
