Small Nonprofits, Big Challenges
It’s no secret that nonprofits run lean, but small nonprofits – those with revenues about or under $1M – run really lean. These nonprofits are often under-resourced, can be volunteer-run, and may be grappling with sufficient infrastructure and systems.
The Ready to Grow Peer Learning & Coaching Cohort specifically focuses on small nonprofits primarily led by people of color. From January through August of this year, our 25 Cohort participants will be meeting monthly to focus on capacity-building and growth, and the challenges of meeting community needs. The goal of this Cohort is to increase the stability, effectiveness, and resilience of nonprofits and their leaders.
Here’s what we know so far from our small nonprofits:
1). Sustainability is hard to reach
Raising funds is hard. It’s harder if you’re a BIPOC leader, given implicit biases and funding practices [see our January blog for more on this issue]. And it’s even harder still if you are a small nonprofit that is not well-known to donors or the regional funder community. Whether we like it or not, raising funds effectively is the key to financial sustainability. Sustainability occurs when a nonprofit can effectively and continuously raise enough money to achieve long-term outcome goals; sustainability is a predictable flow of money inside a business model that can allow nonprofit leaders to plan for the future.
2). Resources are limited…and competition is fierce
Small nonprofits have extremely limited resources, and we’re talking beyond financial. Oftentimes, small nonprofits have small staffs (and the staff may be drawing a minimal salary or no salary at all), may not have access to physical space, may have limited expertise when it comes to nonprofit management, and may be constrained on supplies and transportation. This very state of being under-resourced perpetuates under-funding; many funders, seeking the largest ROI for their investment, seek out larger nonprofits that can provide bigger numbers – more people served, more funds leveraged, more staff in the field, etc. Larger nonprofits, who also struggle with sustainability, tend to receive the lion’s share of funding, while still utilizing smaller partners to reach communities in need.
3). Mission Awareness
While the least sustainable due to their size, smaller nonprofits tend to be “the tip of the spear” when it comes to meeting community needs – often addressing challenges yet to be acknowledged by the mainstream. They bring innovative solutions, relying more frequently on the insights and power of community members than their larger counterparts.
When we capitalize small nonprofits…when we support their leaders…when we shine the light on their creative strategize for change… our sector only gets stronger. Let’s commit to getting the leaders of small nonprofits the financial tools and know-how they deserve. Let’s invite funders to invest in infrastructure and equipment, growth, and more for organizations just starting out. Let’s make sure that small nonprofits have the templates and support they need to put strong board oversight practices in place. Let’s do all we can to build up these important and necessary organizations in our own backyards.
We’re aiming to do all these things for our Ready to Grow Cohort participants. You’ll get to meet more of these impressive organizations in future monthly blog posts. Until then, spread the good word about small nonprofits!
Learn more about Ready to Grow at https://readytogrowoc.org.