In my last post, I mentioned that I disagreed with a recent post by Sandra Simms titled, “7 Reasons NOT to Start a New Nonprofit Organization”.
Unfortunately, I ran at the mouth about why I created Where’s Your Heart? as a non-profit, so never really shared my thoughts about Sandra’s article.
Let’s just take a look at Sandra’s 7 points in order:
1. There is already an organization filling that need.
Yeah. I’d tell Steve Jobs the same thing. There were already other companies making MP3 players. Or smartphones. No need for another one. Go do something no-one else is doing. Sorry about the sarcasm, but no one organization will fill every market’s needs… whether for-profit or not. Do you have the passion and energy to run your own company? Want to have that excitement and feel good about what you’re doing? Think you might even (gasp!) be able to do it better than the establishment? Go for it! Competition is good. And, you’ll feel great.
2. You do not have other people “on board” yet.
Uh, so get them on board? It takes one person to start. Ideas, they’re easy. Execution. Making something happen. That’s hard. And, one person alone can make a huge difference. Show some results, and you’ll have all the people “on board” (what’s with those quotes?) that you want.
There’s even a nonprofit who helps other nonprofits that can’t afford help and don’t have people “on board”. It’s called Grassroots.org. Check them out.
3. Your idea is better suited for a for-profit enterprise.
This is definitely one to think about, but take a look at what I’m doing. There’s a business model (and that includes things I’ve not shared, because I believe in competition and don’t want to give it all away just yet) for my organization. I made an explicit choice, perhaps against the advice of others, to make Where’s Your Heart? nonprofit to emphasis my focus.
Maybe you should do the same? What is your organization’s purpose? Will it be charitable first, then it deserves a nonprofit heading… otherwise it’ll be commercial. There’s nothing wrong with that, but either one can suit your purposes equally well. Remember, it’s your company!
4. Starting up takes time.
You bet. Almost a year for me, and I’ve not yet run an event.
No one said it’d be easy.
If you want to do something quick and easy, read a book. Watch TV.
Want to do something fulfilling? Something that will make a difference? That takes commitment. Be decided and do it. If you believe in your cause, it’s worth your time.
Of course, as Sandra points out, if you want to react to an immediate need (like disaster response) you’re much better off working through an existing organization… Maybe you’ll find your wish to help transcends a single disaster, and you want to start your own organization to help provide rapid response to disaster relief around the world? (Actually, that’s not a bad idea! I can see building infrastructure and using modern technology to enable grassroots rapid-response efforts around disaster relief. Of course, it could be commercial, but possible to be nonprofit.)
5. OK — Sandra accidentally missed this one. I do that all the time.
6. You’d like to plan a one-time fundraiser.
With all my nonprofit experience (tongue in cheek there, I’m a newbie) I agree with Sandra on this one. For a one-time thing, no reason to start up a company and go through the expense and effort. Better to work within another organization. Even if you want to have a yearly event, you could always do it through one (or more) existing nonprofits. And, you’d probably get some help working with another organization as well. Much easier not to have to figure it out on your own (though, that’s not a reason not to start!).
7. Your type of cause makes it difficult to secure long term funding.
Sure. I can re-write this one as “don’t start your business before you figure out how it’s not going to fail.” It might be difficult or impossible to do certain things under the nonprofit umbrella or IRS restrictions. I’ve run into some real serious limitations myself. In my case, I’ve just shelved certain plans/ideas until I get more experience and funding to handle the challenges.
Another suggestion is to rethink your approach, to see if taking a different perspective might make it less difficult to secure funding. In my case, I’m funding it myself, and my approach includes staying at my “real job” so that I can keep doing so. It means my work at Where’s Your Heart? sometimes is slower than I’d like, but the tradeoff is that I can keep at it.
And, with that, I’ll just add that I don’t know Sandra, but I’ve been enjoying her thoughts on twitter and her blog, because she offers good advice on fundraising and other topics of interest to the non-profit community.

[…] post is already long enough, so I’m going to save my rebuttal of the post mentioned above for my next post. In the meantime, if you are intrigued by my passion, or the way I’m setting this company up […]
Hi David, thanks for the comments and kudos for my work on Step by Step Fundraising and Twitter. I enjoy sharing and talking about ideas, especially when it’s about making the world a better place.
You have an interesting point about competition. In the business world there’s a sweet spot between too much competition and too little.
When there are too many competitors in the marketplace there may be a steep uphill battle to get market share, especially without a truly unique offering. Sure Microsoft and Apple are competitors and will continually face new competition. But a company would have to be well funded, have a unique niche and a solid business plan to compete.
A good example of a good reason to found a new nonprofit in the same space is the difference between Habitat for Humanity and Homes for Our Troops. Both build houses for low income or disabled people. However the latter focuses on military who have been wounded in service. Because of this unique focus and passion for the cause, the group has flourished, attracted loyal supporters and helped many people.
However, I talk to a lot of people who really have a great cause, but would be wise to first partner with an existing nonprofit.
Sandra,
I appreciate your perspective… you’ve got tons more experience than I do.
I agree fully with your example, and it’s a great one. Also, though I don’t have any non-profit experience, I do have other experience that gives me some confidence (false or not, time will tell!). However, someone who’s a bit earlier in their career might do well to partner with an existing company to “figure things out”. What do they do well, not so well. How do they serve their market, and what are they missing?
This is where I really believe purpose-based organizations can apply profit-based techniques to be successful. And, by successful, I mean serve their customers, achieve “going concern” status, and meet their corporate mission.
Thank you for your thoughtful response (and article)!
David
Interesting exchange between you two. I think the truth is in the middle. Here’s my perspective as someone who has consulted with NPOs for nearly 20 years…
Sandra’s points are dead-on for most people considering starting a nonprofit. I know, given that my company has helped set up nearly 12,000 of them. The perspective of her post is aimed at the average person who has a dream or idea of doing this.
As a long-time business owner/entrepreneur, I know the average person is better off with Sandra’s counsel on this one. The funny thing is, David, I agree with your points completely. Your perspective speak to an above-average, risk-taking, outside-the-box kinda person…something most people are just not wired to be. It is the very people your article really addresses who are the most likely to create an organization that accomplishes big things.
Great point-counterpoint. There is good advice in there for all types.
Greg!
Thank you for the well thought out response. I agree, and am glad to know there are easier ways for people to get involved!
David
I just texted this to my best friend. This pretty much sums up my response:
“I just read an article called “6 Reasons NOT to start a Non-Profit Org” and got discouraged THEN i read a reply called “Go Ahead, Start that Nonprofit Organization!” and got re-focused and inspired. It’s true that other people affect us. It’s important to follow your heart.”
Susan’s article provides important information and, I understand, was not intended to be discouraging. It may have left me feeling discouraged, but it would not have put out my fire.
So thanks to both of you, Susan for pointing out some very real options and challenges and to you, David for pressing me onward and helping me conquer some self-doubt.
Sterling
My pleasure. Glad you enjoyed it.
My non-profit work has had its up and downs, but has been a big benefit to me personally, and to those we have helped.
I’m looking at starting a religious (christian) non profit either as a corporation or an unincorporated non profit association. Is it true that it would automatically be tax exempt and the only reason to apply would be for recognition, assurance to donors and for possible funding from grants? I’ve read numerous articles that say this. Any thoughts? Thanks!
Hi Jon,
Unfortunately, I can’t help you. I don’t know the details of what has to happen. I had a lawyer take care of it for me, just wanted to make sure it was done right.
Good luck!
David
No worries. Thank you for the reply David. I enjoyed and gained a lot from your posts and replies. Take care, Jon
Hi I was wondering what company did you use to open your non profit or did you use a lawyer!
I used a lawyer. One that is here in NYC. It was very helpful because I was doing something innovative (which is not something easily digested by the IRS).