To Be Or Not To Be “Not-For-Profit”
I’ve been a part of the not-for-profit world for the majority of my life. I have thoroughly enjoyed leading and participating in movements for change. There’s something admirable and deeply inspiring about those who sacrificially live for the greater good of others. My life continues to be formed by such individuals in the not-for-profit world.
During the past 10 years, I’ve had the privilege of working with over 100 not-for-profit organizations in the various aspects of strategy for NPO life. In addition, I’ve been blessed to have work with several for-profit companies that also desire to bring much good to our world. In fact, I started a for-profit company intentionally postured to help both of these worlds (i.e., for-proft and not-for-profit) by helping them to better implement their ideas.
In the work that I do, I get asked quite often by young social entrepreneurs about how to start a non-for-profit organization. I usually respond by taking the conversation somewhere more foundational with the following question:
Is not-for-profit the best way for you to achieve your purpose or live out your passion to help others?
As someone who lives in both worlds (i.e., for-profit and not-for-profit), I have come to recognize that one path is not necessarily better than the other in reaching one’s goal of bringing good to humanity. They are just different. If you’re an social entrepreneur considering the possibility of starting a non-profit, I hope you find some of the following basic thoughts helpful in your processing:
- Not-for-profit organization does not necessarily mean that you are more noble in your pursuit for good than for-profit business leaders. Unfortunately, there appears to be a cultural fad towards launching not-for-profits based on this romanticized view of doing (or leading) good. It’s kind of cool to say, “I run a non-profit.” That kind of coolness will fade away real quick when you have to start paying bills, implement projects, and manage staffing. The sobering truth of the matter is that there are plenty of profitable businesses that are doing a ton of good in our world; and in some cases, doing a better job at several levels than many NPO’s.
- Not-for-profit work still requires smart business. The designation of “not-for-profit” is simply a government designation that categorizes your entity for tax purposes. Just because something is not-for-profit, it doesn’t follow that you should view it as something less than a well run business. A good business will have a well thought-through plan for sustainability, scalability, and clarity of direction.
- Be sure to do your homework and see who you’re “competitors” are in your field of passion. It’s not so much that you will be competing with them, but rather, this knowledge will help you assess whether or not you’re actually bringing something of benefit to the table. What is it that your organization will do to add value to the overall efforts in your area? Does your unique require you to start another organization? Could your uniqueness become an added benefit to an existing work of another instead?
I am definitely not against not-for-profit work. I think it brings much needed good to people. I suppose all I’m really saying is that one should not default to not-for-profit work simply because of some of the positive nuances associated with it.
My advice: Choose a path that best serves your overall mission and hope. Both paths can accomplish great things so take some time to work through your options. Feel free to leave any questions you may have below.
Thanks for choosing the kind of life that brings good to our world!