How to Secure Funding for Your Non-profit Startup

How to Secure Funding for Your Non-profit Startup

Being a startup entrepreneur doesn’t necessarily mean you need to chase profit. You can have a significantly positive impact on the world by creating a non-profit startup. It’s a chance to utilize your innovative and strategic skill sets to address social, environmental, or ethical issues that mean the most to you.

This doesn’t mean the path to success is necessarily easy. One of the key challenges many non-profit startups find is in gaining access to essential funding. As your enterprise is not geared toward gaining profits, traditional lenders and investors can be reluctant to engage with you. It’s also the case that there’s no shortage of other non-profits competing for limited sources of funding.

You shouldn’t be discouraged, though. There are some tools and strategies you can use to secure funding for your non-profit start-up. Let’s take a look at a selection of them.

Utilize Grants

As a non-profit, grants can be among your most powerful funding sources. Having a good range of these can help you to manage your day-to-day operations or engage in long-term projects. As such, you should dedicate time and energy to researching and applying for grants from the outset. Look into state and local government grants as well as those from private foundations.

However, it’s important to recognize that grant applications are highly competitive. There’s a limited number of these around and multiple organizations will be vying for the attention of providers. As such, you need to put your startup in the best position possible. Make sure your applications have evidence of previous activities and success in the field. Include clear plans for your use of the grant money in line with the specific intentions of the provider’s organization. It can also help to research prior successful applicants to understand what the provider is keen to support.

You should also not only target grants suited to your type of non-profit, but also to who you are as a non-profit entrepreneur. Some grants are designed to support minority-led or operated organizations. Many of these require confirmation of eligibility through membership in organizations or possession of certifications. For instance, becoming a certified women-owned small business can open a company up to additional resources and potential partnerships with large corporations. This, as with many certifications, requires an in-depth assessment process. However, the potential outcome can be a valuable form of support for your burgeoning non-profit. 

Consider Diversification

Securing funding in the non-profit sector can revolve around maintaining a delicate balance. As with any small business, it’s important to be vigilant about the real-time direction of cash flow. Unfortunately, less than half of small business owners manage cash flow, which is dangerous for longevity. A lack of control here can very quickly see your business devolve into chaos. There are certainly applications that help make monitoring your income and outlay more manageable. However, in the end, the challenge is often about keeping a tight rein on finances so you can make a grant or donation last until the next round of funding applications comes around. This can be a stressful way to operate. 

As such, it’s worth considering how you can effectively diversify funding sources for your non-profit start-up. It’s tempting to celebrate the acceptance of a grant and just focus on spending it on your projects. But this puts a lot of pressure on that single source of financing. You’ll find your startup can be more agile and financially secure if you are active in seeking a variety of income options.

This doesn’t just mean utilizing multiple grants or having a large portfolio of donors, although these can certainly be helpful. Rather, it’s about adopting a strategy that incorporates diverse income methods. For instance, you can apply for grants but also sell merchandise related to your cause. Seek support from angel investors specializing in non-profits while also providing professional services to other businesses or events. Your activities still need to be in keeping with the ethical directives and mission of your non-profit. Nevertheless, a diverse income can increase your revenue and protect you from the challenges of a limited cash flow.

Seek In-Kind Donations

Securing funding isn’t just about bringing in the capital you need to function. It’s also about pushing what you have as far as possible. Therefore, part of your quest to secure startup funding shouldn’t just be directed toward money, but other valuable forms of investment. In-kind donations can be a great tool here.

This tends to be particularly effective when you’re approaching corporations or even state and municipal governments for support. You may be able to gain access to donated real estate in a company’s offices or access to their utilities for a certain number of days per week. A business may provide excess inventory you can sell or utilize in your operations. Some online companies may be able to provide complimentary access to their software services or marketing tools as donations. Even partnering with your non-profit competitors to share operational resources can make you both more successful.  

In some ways, seeking access to these in-kind donations should be among the first options you pursue. It helps to get your company into a practical operating position from the outset. It also allows you to reassure cash funding providers that their donations or investment will be primarily going toward projects. You may also find these donations boost the value of your non-profit, which, in turn, could make you more attractive to lenders and investors later on.


Starting a non-profit can be enriching, but gaining funding isn’t always easy. Take the time to fully research grants that may be available to you and gain certifications to boost your eligibility criteria. Wherever possible, diversify your income streams to prevent common cash flow issues. Alongside monetary funding, in-kind donations can be solid tools to support your operations and boost your value. With some careful strategizing and vigilance, you can build a successful business that makes a genuine difference to the community.

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Amanda Winstead

Amanda Winstead is a writer from the Portland area with a background in communications and a passion for telling stories. Along with writing she enjoys traveling, reading, working out, and going to concerts. If you want to follow her writing journey, or even just say hi you can find her on Twitter.

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