What Entrepreneurs Can Learn from Nonprofits?

A nonprofit organization and a start-up may seem to have very little in common. That couldn’t be further from the truth.  That’s why a quick study of the way nonprofits stay afloat is a good way for entrepreneurs to find inspiration for their own businesses.

Nonprofit Founders Have the Entrepreneurial Spirit

If you ask around, you will find that many nonprofit founders are essentially entrepreneurs who started their nonprofit from scratch.  They work long hours and sacrifice their free time to make a nonprofit successful.  They are as invested in its mission as entrepreneurs are invested in their business ideas.

This energy for the job is what allows some nonprofits to succeed while others fail. That same type of energy is vital to an entrepreneur’s quest. They can’t be lazy or expect others to do it for them. Entrepreneurs must be the hardest worker on the team.

Nonprofits Can’t Pay Their Employees Enough

An entrepreneur can learn from the ways that nonprofits attract and keep talent. Nonprofits don’t have the money to pay their employees as well as the private sector.  They know about the difficulties in finding highly qualified staff who will work for lower wages. Even when they are well-established, a nonprofit executive search will be very different from that of a business. They need to attract talent without paying top dollar.

No doubt, these agencies have struggled with filling positions and keeping good employees.  The best ones know the tricks for keeping their best talent happy and fulfilled.  The best employees, on the other hand, are the ones who become consumed with the nonprofit’s mission. This type of personality, someone who loves a challenge and is hungry for the chance to prove themselves, is perfect for a startup.

Like a nonprofit, a startup may be able to attract talented young people who will work for the experience as much as for the pay.  This brings energy and enthusiasm to the workplace, which is always helpful on long days.

Startups and Nonprofits Must Raise Funds

Furthermore, since it isn’t easy for nonprofits to sustain growth or raise money, they are often  in the same boat with start-ups, even if the nonprofit has been around for a decade or more. Any nonprofit director will tell you that they rely on grants to operate.

They must meet many guidelines to apply for those grants and jump through hoops to keep them. This is similar to the way that entrepreneurs may need to pursue funding from a variety of sources to get their business going.  

The lessons here are that you can’t be ashamed to ask for money.  In fact, you have to be relentless and fearless in pursuing sources of capital.  You may have to make compromises to get funds. You may have to meet someone else’s requirements to get the money. Yet you can prosper and grow despite any obstacles you face.

They Know the Community

Nonprofits know their community. In most cases, that’s literally the community around them. Sometimes, however, it is a section of society. For instance, they may work with a specific group, such as cancer patients. They must know who the players are, who the movers and shakers are, and who best to avoid.

Your business model should focus on knowing the community as well. Entrepreneurs need to network with others to build their brand. This will include attending local events, going to regional and national workshops, and maintaining a social media presence.

As you build your business from the ground up, look around at the small, but stable nonprofits in your area. Their success may hold the keys to unlocking your own success.