A Dozen Measures of a Fundable 501(c)(3) or (c)(4) Nonprofit Organization

When working with start-up nonprofits or organizations in early stages of maturity, I have found expectations for funding are often unrealistic.

Here I present an even dozen measures or characteristics of a fundable 501(c)(3) or (c)(4). These are factors that funders may often look for and consider when evaluating requests for funding.

Among reasons for fundraising success is the perception by funders of the stability and ability of any given organization to achieve mission objectives. Funders will consider which among the many applicants for funding will be able to effectively manage and administer not only the projects to be funded, but they will also consider the organization’s ability to navigate standard business practices of managing and administering financial and human resources for any purpose. Here are an even dozen measures of the fundable 501(c)(3) or (c)(4). I also present a few suggestions on practical means for a nonprofit to measure up, while still growing organizational maturity.

The Fundable 501(c)(3) or (c)(4)

1. Has received a letter from the IRS confirming that the organization is recognized as a 501(c)(3) or (c)(4) tax-exempt organization.
2. Is up and running, fully and properly functioning, with normal nonprofit business practices, policies, and procedures in place for the board and staff. Funders often REQUIRE policies in place that ensure non-discriminatory hiring and a workplace free of discrimination and harassment. Funders, and in particular granting organizations, mean to support the nonprofit’s mission, not pay the bills for everything. (There are some funders, however that may provide capacity building grants to assist in moving an organization from start-up to functional.)
3. Has a clear achievable mission and vision to actually achieve mission, including strategic and operational long-range plans tied to realistic budgets.
4. Has differentiated its mission, approach, or means to achieve its mission within the organization’s applicable community of practice.  The term “community” as used here doesn’t necessarily just refer to your geographically confined local community. It’s the community of people with an affinity for your cause, such as your members, and anyone else who you believe may be relevant to your efforts to achieve mission. Funders tend to shun organizations that duplicate or overlap with other organization within the same community.
5. Has sound business practices, and delivers services as promised on time and within budget.
6. Evaluates programs and processes on a regular basis to ensure effectiveness and makes improvements.
7. Has capable leadership.
8. Has effective mission achieving programs that make a difference.
9. Has adequate tools, including basic facilities, financial management systems, communications, IT, technical, website, donor management.
10. Has adequate funding for mission work, an adequate financial base of unrestricted funding for normal operations, and a diverse revenue stream to help maintain stability. Funders generally avoid organizations with unstable, failing, or failed finances.
11. Has a measured, verified, and documented record of success.
12. Works well with others, through collaborations, partnerships, coalitions and other arrangements that stretch or leverage funds and actions.

Ways to Measure up Like a Fundable 501(c)(3) or (c)(4) During Start-Up

1. Partner and collaborate with established organizations, especially with well established 501(c)(3) or (c)(4) nonprofits.
2. Establish relationships with funders.
3. Seek and obtain capacity-building funding.

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(c) Rudolph Rosen 2018

Rudolph Rosen is author of the book, Money for the Cause: A Complete Guide to Event Fundraising a peer-reviewed textbook on fundraising management and increasing fundraising success in good times and bad through effective business management and volunteer and staff empowerment and training.