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What is Your Nonprofit's Funding Model? Featured

What is Your Nonprofit's Funding Model? Fezbot2000

Money is a crucial necessity that keeps any nonprofit in operation. It is for this reason that this is the leading topic of conversation among professionals in this sector. Among the key points of discussion is where money can be obtained for, why there is less money and how much money is needed to fund a particular cause.  These questions become even louder in tough times like we are today. The answers to these questions cannot be obtained easily. As a nonprofit leader, here are some nonprofit funding models that you need to acquaint yourself with to maneuver the ever-dynamic charity landscape.

  1. Heartfelt connector

This model focuses on the cause or causes that resonate with the concern of a large number of people or real issues that affect people of all income levels. It entails creating a structured way that allows people to connect where no way had existed before. The heartfelt connector model builds explicit connections among volunteers through special fundraising drives that allow individuals to give money. It includes volunteers that work together to form teams, seek funding and participate in fundraising events. Some of the leading areas that this model is applied to include medical research, environment, among others.

  1. Beneficiary builder

Nonprofits that use this strategy offer services to individuals that pay to cover the cost. These nonprofits rely on people that have benefitted from their services for their donations. An example of such nonprofit is Cleveland Clinic which provides medical services to individuals but depends on the same individuals to donate for their various medical-related causes. The beneficiary builder funding model is used mainly by hospitals and universities. Universities, for example, offer services that motivate the beneficiaries to give money back because of the impact that services offered had on their schooling.

  1. Member Motivator

This model depends on individuals who donate money because a cause being funded is integral to their daily life and is something that a given group of people benefit collectively. This model aims at connecting members and donors through activities that they are already seeking. The organizations that use this model are those in religion, environment, humanities, arts and culture. An example of an organization that uses this funding model is The National Wild Turkey Federation (NWTF) whose aim is to protect wild turkey habitats and promote wild turkey hunting. The turkey hunters collectively benefit from this federation’s work and are the sole members and fundraisers.

  1. The big bettor

In this model, nonprofits rely on grants from a few individuals or foundations to fund their activities. The main donor is also the founder who wants to tackle a specific issue that is personal to them. While the beginning of funding start with financial backing having been secured already, the existing can sometimes get support from a major donor who may come up with financial backing to fund a new approach that will help a given problem. The main causes that are targeted by Big Betters are those that are either in medical research or environment.

  1. Resource Recycler

This model allows organizations to receive donations in-kind and later distribute what they receive from donors to the needy. Some of the donations they receive are food with an expiration date, clothing, among others. Although the main donations that these nonprofits receive are in kind, they also collect additional funds that help to settle operating costs. Non-profits using this funding model are those in food, agriculture, medical industry and nutrition.

Although there are more than fifteen nonprofit funding models in place, identify the one that suits you based on the industry you want to venture into or the course you want to involve yourself in.

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Scott Koegler

Scott Koegler is Executive Editor for PMG360. He is a technology writer and editor with 20+ years experience delivering high value content to readers and publishers. 

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