This week on the Nonprofit Jenni Show, we explore different types of mission-driven organizations, and compare which options are most effective for pursuing your cause. Play a round of Nonprofit Trivia with Rachel Bearbower from Small Shop Strategies to test your knowledge about alternatives to starting a 501(c)3 nonprofit!
5 Types of Mission-Driven Organizations That Aren’t 501(c)3 Nonprofits
If you’re thinking about starting a 501(c)3 nonprofit organization, I recommend researching these other organization types first! Starting a new nonprofit may not be the best way to serve your mission.
If you already run a 501(c)3 nonprofit, think about how you can partner with these other types of organizations to have a greater impact!
(Note: You can have more fun learning about these different organizational structures by playing along with Nonprofit Trivia in episode #104 of my podcast!)
1. Social Enterprise
The Social Enterprise Alliance defines a social enterprise as “an organization or initiative that marries the social mission of a nonprofit or government program with the market-driven approach of a business.”
Essentially, a social enterprise is a mission-driven, for-profit business that uses its resources to support a good cause. Examples include TOMS and Plaine Products. (Nonprofits can own social enterprises.)
2. Public Benefit Corporation
Every public benefit corporation (B Corp) is a social enterprise, but not every social enterprise is a B Corp. The Social Enterprise Alliance explains that “B Corp refers to a certification and public benefit corporation refers to a legal incorporation type.”
Your social enterprise can take the next step to prove its commitment to social good (and maybe even recognize some tax benefits) by earning B Corp certification. Examples of certified B Corps include Jeni’s and Classy.
3. Mutual Aid Organization
Last year, VICE News published an article about how mutual aid organizations can help us respond to COVID-19. The article says, “Mutual aid is also not charity: rather than creating a centralized organization where one person is giving to someone else, forcing them to become dependent on yet another relationship negotiating their access to material resources, mutual aid creates a symbiotic relationship, where all people offer material goods or assistance to one another.”
VICE News goes on to share an example of mutual aid following Hurricane Sandy: “[A]ctivists with Occupy Sandy organized direct relief to victims of Hurricane Sandy after the superstorm made landfall in 2012. Thousands of volunteers provided necessary goods that were otherwise unavailable because of shuttered stores and damaged infrastructure, like bottled water and food, and set up community hubs where those in need of help could seek resources and support.”
4. Fiscal Sponsor Relationship
According to the National Network of Fiscal Sponsors, “Fiscal sponsorship generally entails a nonprofit organization (the “fiscal sponsor”) agreeing to provide administrative services and oversight to, and assume some or all of the legal and financial responsibility for, the activities of groups or individuals engaged in work that relates to the fiscal sponsor’s mission.”
In other words, a fiscal sponsor allows you to focus on providing the services your community needs while they provide financial support, administrative support, and/or legal oversight for your initiative.
5. Local Affiliate or Chapter of a Larger Nonprofit
If you believe you need to start a 501(c)3 nonprofit to accomplish your charitable goals, you may want to consider applying to start a local affiliate/chapter of a national or global nonprofit that already exists. Affiliate relationships can provide a strong infrastructure, best practices, and a bank of resources so you don’t have to start from scratch.
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Jenni’s Favorite Resources This Week
How to Be a Grant Writer — I’m so thankful to Learn Grant Writing for sponsoring this episode! LGW teaches you to become a grant writer so you can fund the causes you love the most. Watch their free webinar on how to become a grant writer.
Should I Start a Nonprofit? — In episode #61, I ask two nonprofit CEOs to share their advice to people who wonder whether they should start a nonprofit. Search for episode #61 wherever you get your podcasts to listen!
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