Top Revenue Generation Tips for Nonprofits
During our free session on the 10 Things Nonprofits Need to Know About Generating Revenue, Creative Strategist Kim Kirton from The Good Growth Company roster. The session was part of this series.
By reading this recap, you’ll get an idea of the content covered including ways to drive sustainable revenue and maximize your impact. Having sustainable revenue will not only help keep your team feel valued and fairly compensated but will ultimately increase your overall impact.
Dive into this overview that combines social impact and business principles. During the session, we also answered questions from attendees from nonprofit organizations, which are integrated into this recap.
Check out our Social Enterprise Development Pilot Program for Nonprofits here.
What do you need to know about Generating Revenue?
The session covered 10 crucial aspects of effective revenue generation for impactful social work. Kim emphasized the significance of these fundamental pillars: Revenue Generation Strategies and Models, Stakeholder Engagement and Research, Utilizing Tools and Frameworks, Collaboration, Communication, and Iterative Approach, Balancing Mission and Revenue Generation, and Event Sponsorship and Upcoming Activities.
Understanding various strategies and models tailored to the unique needs and goals of nonprofits is essential for sustainable financial growth. Engaging with stakeholders and conducting thorough research are vital steps in identifying opportunities, understanding donor motivations, and fostering long-term relationships. Leveraging specialized tools and frameworks empowers nonprofits to streamline processes, track performance metrics, and make data-driven decisions to maximize revenue potential. Collaboration among team members, effective communication with stakeholders, and adopting an iterative approach foster innovation, adaptability, and continuous improvement in revenue generation efforts. Maintaining a delicate balance between advancing the organization's mission and generating revenue is crucial for ensuring alignment with core values and long-term sustainability. Exploring event sponsorship opportunities and planning upcoming activities strategically can enhance visibility, attract new supporters, and diversify revenue streams for sustained impact.
These key areas highlight the multifaceted nature of revenue generation in the nonprofit sector and underscore the importance of holistic approaches in achieving financial sustainability and advancing social causes.
Let’s look into some of the topics further.
Top Takeaways & Topics
Revenue Generation Strategies and Models
Kim emphasized the importance of diversifying revenue streams for nonprofits to reduce reliance on traditional funding systems. The goal is to deepen impact by identifying opportunities within current resources. Kim discussed various revenue generation models, including the social enterprise model, e-learning model, and event sponsorship. She highlighted the potential for government funding for capacity building and emphasized the benefits of sharing organizational expertise through workshops and knowledge-based services. Kim also mentioned examples such as Forra's DEI workshops and event sponsorship by nonprofits like the Social Enterprise Development Fund in Ottawa. Kim emphasized the importance of validating ideas by scaling down and using existing tools for testing. She suggested methods such as presale lists for merchandise to gauge interest before investing resources. Additionally, she recommended piloting workshops or services with minimal fees to confirm customer interest and willingness to pay. Kim also stressed the need for flexibility and openness to pivoting based on feedback, in order to find a niche for consistent revenue generation.
Daniel suggests that nonprofits can launch separate businesses or brands to sell products or services without replacing their fundraising efforts. He emphasizes the potential of reaching a new target audience through this approach, using an example of a charity in downtown Brampton opening an e-commerce business for custom handcrafted mugs. Kim does not provide additional thoughts on this topic. The participants delved into considerations for a registered federal nonprofit organization looking to sell merchandise as a method of generating revenue. They emphasized the importance of validating market interest before seeking advice from an accountant regarding tax implications related to business activities versus nonprofit registered charity activities.
Stakeholder Engagement and Research
Kim recommended conducting an audit using the Social Business Model Canvas tool to assess the current funding model, stakeholders involved, intended impact targets, and organizational visibility among stakeholders. She encouraged engaging with stakeholders through interviews, focus groups or surveys to understand their motivations and challenges to identify future opportunities effectively. Kim advised conducting secondary research on existing market practices while sharing examples such as one-for-one purchasing models partnering with other businesses or organizations like Bidium Bows that employ equity-deserving communities offering job skill training. Kim encouraged stakeholders to reflect on stakeholder responses to identify common themes and opportunities. She suggested analyzing feedback from stakeholders, such as anecdotal responses about working with the organization or receiving a monthly newsletter. She also advised on considering external factors like a strong social media presence in mobilizing donors when identifying patterns.
Utilizing Tools and Frameworks
Kim emphasized using the business model canvas as a tool for gathering information, being open to feedback, pivoting ideas based on research findings, and questioning what makes their organization unique before generating new ideas. After brainstorming ideas freely based on research findings from audits and canvassing efforts, Kim recommended assessing idea feasibility by organizing them according to resources required for execution. She provided an example of evaluating high-value actions with low resource requirements using a template that includes columns for ownership responsibility and results tracking. Kim stressed leveraging existing tools to validate ideas before heavily investing in new resources or seeking additional funding. This involved utilizing available resources within their reach to validate concepts without significant additional investment. There was an emphasis on utilizing tools like the social business model canvas to understand an organization's current structure, stakeholders, opportunities, strengths, and expertise areas while collaborating with teams and boards.
Collaboration, Communication, and Iterative Approach
Kim highlighted the significance of including diverse perspectives from both internal teams and external communities in the ideation phase. She underscored that involving stakeholders signals transparency, builds trust, and fosters communal ownership within organizations. The discussion touched upon sharing journey milestones with stakeholders as a means of showcasing impact achieved through initiatives. It was suggested that this data could be used when applying for grants or seeking further partnerships. The meeting highlighted an iterative approach based on feedback until achieving consistent revenues through low-resourced testing methods before scaling up successful initiatives gradually.
Balancing Mission and Revenue Generation
Considerations were made about ensuring potential revenue streams do not compromise the core mission or impact; it was noted that selling products or generating revenue might have fewer restrictions than funds received from donors or sponsors. Kim and Daniel discussed various revenue generation strategies for nonprofit organizations, emphasizing the importance of integrating new initiatives with existing activities. They highlighted the potential of engaging the community through newsletters and involving team members to deepen impact without extensive outsourcing. The conversation also touched on validating ideas, obtaining resources, building partnerships, and applying for funding to support revenue-generating efforts. The discussion revolved around balancing resources between fundraising efforts and new revenue-generating initiatives. Daniel suggested reallocating time and capacity from fundraising if it is not yielding results while emphasizing that these initiatives should complement rather than replace existing operations. Kim added that testing out ideas before consulting an accountant about tax considerations is crucial. The conversation explored how much investment should be made in marketing products or services compared to fundraising efforts. Additionally, they discussed successful product or revenue-generation businesses operating outside their brand as a less conventional approach worth considering by charitable organizations.
Event Sponsorship and Upcoming Activities
Kim shared her approach to approaching companies for event sponsorship, emphasizing the importance of researching the organization's values and mission before sending a concise email outlining shared interests and proposing a 10-15-minute call. She also highlights the significance of having a deck that outlines accomplishments, support, ask, timeline, and mutual benefits when communicating with potential sponsors.
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