small-shop nonprofits

Below are 6 “lies” that I’ve seen in action at different small-shop nonprofits in one form or another. Can you identify with any of these?  

1. “My board members know best how to fundraise.”

Board members are a great and necessary part of a successful nonprofit. However, sometimes they think they know best how to operate the fundraising strategies of the organization. If you are an Executive Director or Director of Development for a smaller nonprofit and are involved in the day-to-day operations of your organization, you should know best. The process of educating your board on best practices in the fundraising industry is challenging, but worth your time. You are the fundraising expert – not the board.  

2. “Our big annual event is the most important fundraising activity of the year.”

Big, fancy galas can have a great impact for many nonprofits. These can also provide a lot of warm-fuzzies and great PR. However, events can be extremely expensive and take a lot of time to execute successfully. Just because it’s something you’ve always done, doesn’t mean it is the best strategy. The resources in time, money, and energy spent planning a fundraising event may be better spent on donor/prospect relationships and working to retain existing donors.

3. “I don’t need to pay my staff what they are worth because they are doing this for ‘the greater good.’”

There are many reasons why staff turnover is so high for fundraising professionals. I suspect this is certainly one of them. Paying lower salaries to top-quality employees hinders your ability to recruit the right people and keep them with your organization for the long-term.

4. “I don’t need to invest in technology, training, or other tools to make my job more efficient.”

It can be hard to justify spending several thousand dollars on a new fundraising software or other productivity tools, especially when budgets are tight and programs are under-funded. It can be a vicious cycle. But investing in staff training and productivity tools can not only increase the skills and productivity of your staff, it will also increase morale. Thinks of these items as investments, not expenditures.

5. “We are too busy to fundraise.”

This one may be my biggest pet-peeve. Program effectiveness should always (obviously) be a top priority. But that can’t overshadow the importance of caring for your donors and sharing your mission with new people. Nonprofits should be laser-focused on donor relationships, donor retention, and setting appropriate fundraising goals. Jay Love wrote an excellent blog post outlining six characteristics of a well-run nonprofit. It focuses on how to be a donor-centered organization. Click the link – it’s worth the read.

6. “Since we are a nonprofit, our revenues cannot be greater than our expenses.”

This is simply not true. But I’ve had people working for nonprofit organizations tell this straight to my face. Your tax-exempt status does not prevent you from making a “profit.” Instead of turning around and paying owners and investors, you are reinvesting revenues into additional staffing, improved programs, etc. Check with your accountant, but from what I understand, as long as your nonprofit’s activities are associated with your purpose, any profit made from them isn’t taxable as “income.”

Hopefully your nonprofit has not fallen for any of these. Can you think of other “lies” that nonprofit organizations are susceptible to believing? Would love to hear your feedback in the comments below.

Mitch Peterson

Mitch Peterson

Senior Account Executive at Bloomerang
Mitch Peterson is a Senior Account Executive at Bloomerang. He was previously Director of Marketing at Sports World Ministries, Inc.