Starting a New Nonprofit

Please allow me to crush your dreams...

In my last post, I asserted that not every new problem (or newly recognized problem) warrants a new nonprofit to address it.

I used the example of The Hurricane Sandy New Jersey Relief Fund, which gathered more than $32 million in four months, but had yet to give a dime to help victims of the hurricane. Why? Because the foundation's leader, New Jersey first lady Mary Pat Christie, was taking the time to set up a nonprofit organization carefully - which takes far more time than disaster victims can spare.

Meanwhile, another nonprofit addressing the EXACT same problem - Robin Hood Foundation distributed almost the entire $67 million raised from the 12-12-12 benefit. As an already-established nonprofit, they able to get resources where they were needed - quickly and efficiently.

Almost every week I talk to passionate, caring people who want to make the world a better place through a new nonprofit. The latest was a man who wanted to start a nonprofit organization that addressed breast cancer - he had just lost a dear friend to the disease and wanted to honor her.

What a wonderful man and a great friend! While I had no desire to crush his dreams, I encouraged him to think through if a new nonprofit was REALLY the best way to honor his friend.

Nonprofit start-ups should look to the business world when considering a new organization. When an entrepreneur is considering a new business, they do extensive and exhaustive research on these basic questions:

• Is there a market (a need) for this business? 
• What is the unique niche my business will serve? 
• Will there be customers?
• What am I selling? 
• What do I charge? 
• Where should I locate? 
• How will I market my business?
• What is the competition? 
• How will I get the money for this business?

These are the same questions new nonprofit start-ups need to ask.

It's actually MORE important for a nonprofit. Why? Well, if the entrepreneur fails to gauge the market, he will lose his own money and the business will be one of thousands (millions?) that fail each year because they just weren't needed. But if a nonprofit organization fails, they are losing donors' money - money that could have gone to more successful organizations. When the new nonprofit fails, people in need are likely to suffer from losing whatever benefit they were receiving from the nonprofit. It hurts everyone and makes the world a worse place.

If you have a dream that will make the world a better place, don't give up on it. Just be wise in addressing it. Ensure you know what you are doing before you begin using resources.

So, what about the man who wanted to address breast cancer? I don't know if he is still interested in that or not - I haven't heard back from him. I did, however, give him a list of questions to consider. I will share that list in my next blog post. Stay posted.