Ten Nonprofit Funding Models

October 6, 2009

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Paradox . . . so much time, so little money

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Our fundraising strategy used to be ‘let’s raise more money this year than last’ and we were always unsure where we’d be. Then we got serious in thinking about our model and identified an ongoing type of government funding that was a good match for our work: While it required some program changes to work, we now predictably cover 70% of our costs in any locality through this approach.

- Earl Martin Phalen, co-founder of BELL

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Why it’s so hard achieve. . .

•Our inclinations

•Conventional wisdom

•Tough economic times

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For nonprofits . . . funding is a its own strategic question

Company

$

Pro

duct o

r serv

ice

Customer (Payor=

beneficiary)

For profit sector

Beneficiary

Organization

Nonprofit sector(generally)

Payor

$

Pro

duct o

r serv

ice

? ?

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What we know . . .

•Realism is important

•At scale . . . robust funding is generally concentrated in one source

•Natural matches will dictate a few paths

•Organizational capabilities are required

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Top ten nonprofit funding models (1 of 2)

Source: Foster, W., Kim, P., Christiansen, B. (Spring 2009). “Ten Nonprofit Funding Models;” Stanford Social Innovation Review, pp. 32 – 39.

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Top ten nonprofit funding models (2 of 2)

Source: Foster, W., Kim, P., Christiansen, B. (Spring 2009). “Ten Nonprofit Funding Models;” Stanford Social Innovation Review, pp. 32 – 39.

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Funding-related articles in SSIR

Note: Artwork courtesy of the Stanford Social Innovation Review

Spring 2007 Fall 2008 Spring 2009