Ask HN: How to get money for running a non-profit project?
I have created a non profit project for ease of governance. There is no business model. I do i scale it and keep it running? Any other options than donations?
I also added a bitcoin and ethereum donation address recently. I've got nothing from it yet, but maybe you can try that also.
I think thats the most robust way to insure longevity of the enterprise. Relying on donations to keep the lights on is difficult.
Can confirm - the Hackerspace I help run is in big part funded by company donations. Every now and then comes the day when I have to convince someone to keep donating, and since result depends mostly on the goodwill of the other party, we have to play safe with finances - which slows the growth and acquisition of new useful workshop tools.
We're trying to move to self-sustainable model, but with almost everyone having a day job and/or a significant other, it's damn difficult.
It is a meaningful metric because it's our whole raison d'être - providing free access to more and more advanced workshop for building stuff and learning new skills.
-Membership dues -Vending machine with useful supplies -Locker / storage space rental -Government grants for larger purchases
A community workshop I used to go to had great success with this. There were two membership types, drop-in and keyholder, with different monthly dues and perks. That was enough to be self sufficient and make routine equipment purchases. When they needed to make a big purchase, like a dust and fume extractor system, they got a grant for between $5000-20000 from the local government.
- IT companies
- electronics companies (one of which is our current regular donor)
- local angel investors
- government grants (we did a series of workshops for a project run by the US embassy in Poland)
Two other options we're also exploring:
- various grants, both government (national and EU) and from company-backed nonprofits
- CSR - big companies tend to have money allocated to spend on non-profit causes because of their Corporate Social Responsibility programs; you can try and apply to those
As for how we approached companies: we mailed them directly, describing what we're doing. We created a nice PDF brochure to be attached with details and photos. However, the best results came from something else - some of our members talked about our Hackerspace at work, and the word reached their employers, who then reached out to us.
First I suggest you take a look at the hackerspaces.org Design Patterns (https://wiki.hackerspaces.org/Design_Patterns), particularly the Independence and Sustainability patterns. Relying on donations is following the "Sponsoring Anti-Pattern".
I've seen a lot of not-for-profit groups who end up on the "grant cycle". The spend a bunch of time applying for various grants or soliciting donations just to survive. Once one grant/donation is secured it's time to start chasing the next one. Instead of spending time working in the 'space and making things.
You say you have paying members already which is great - this is the key to real sustainability. Perhaps you could follow the Charitable Member Pattern and see if they would be able to pay their entire year up front to get the space off the ground?
Starting a makerspace has been one of the most satisfying and worthwhile things I've done and I highly recommend sticking at it and making it work. I wish you good luck!!!
You just have to plaster a giant banner ad of your puppy dog face, begging for donations at the top of every article. Works for Jimmy Wales.
Widely speaking, the three likely sources of income I can think of are
(1) People - either donations / patronage, or in return for something - you'll likely have more success with this if you provide regular benefits or at least token value in return for them.
(2) Grants from some community grant organisation, for example in Western Australia the Lotterywest lotto company gives out a large sum of grants as part of their license - but there may be other grant sources including private or government - eligibility will likely depend on your mission and actual status as a non profit and/or charity (these two things differ in Australia, no idea about other countries.. I think the US has some weird 3rd "public benefit" category)
(3) Find a home under the umbrella of some other already funded organisation that takes additional projects under it's wing, things like the Apache Software Foundation, GNU, etc. (no guarantee you'll actually get funding, but it may be possible in some cases.. some foundations may help you out legally but not with funding).
Grants are often hard work and come with various requirements, and are often even best case some chance of winning if you compete against others. And hard to maintain long term, so is more suited to short term. In most cases it is unlikely you'd get regular grants over time and there's definitely a time burn even if you can.
Some kind of patronage or regular output getting donations from people generally is easier to have recurring but actually getting a notable number of patrons/donations on a regular basis is difficult. Often not too bad once established.
Lastly a home under a foundation is likely difficult for a new project.. so in that case likely you'd need to self-fund until the point that may be possible.
Hope that helps.
In terms of how to get going, here are a few useful links:
First, a feasibility study: http://help4nonprofits.com/NP_START_IsItFeasible_Art.htm
Next, a board: https://www.thebalance.com/importance-of-nonprofit-first-boa...
And, as an added bonus, much like in the for profit world, once your non-profit shows that it can sustain itself indefinitely, you'll have people/foundations/other organizations coming out of the woodwork to fund you!!
Is there no business model, or is there no business model yet?
As Google demonstrated, there are plenty of investors ready to invest in companies which have no clear business model providing that they're doing something which could theoretically be turned into a business eventually.
As an example, there are lots of non profit hospitals that charge for a product but don't seek to make a profit.
Would people pay for your product?
Well no, that's my point. Free software projects don't have governors, they have maintainers. They don't have non-profits and boards and diversity quotas and codes of conducts, they have mailing lists and BDFLs and coding standards and banhammers.
This politicisation and corporatisation of free software is not good for free software.
With GNU, and the Free Software Movement, the Free is definitely free as in freedom, which is a political concept.
From the Free Software Movement:
https://www.gnu.org/philosophy/free-sw.html
The four essential freedoms
A program is free software if the program's users have the four essential freedoms:
The freedom to run the program as you wish, for any purpose (freedom 0).
The freedom to study how the program works, and change it so it does your computing as you wish (freedom 1). Access to the source code is a precondition for this.
The freedom to redistribute copies so you can help your neighbor (freedom 2).
The freedom to distribute copies of your modified versions to others (freedom 3). By doing this you can give the whole community a chance to benefit from your changes. Access to the source code is a precondition for this.
A program is free software if it gives users adequately all of these freedoms. Otherwise, it is nonfree. While we can distinguish various nonfree distribution schemes in terms of how far they fall short of being free, we consider them all equally unethical.
From the GNU Wikipedia page:
https://en.wikipedia.org/wiki/GNU
Richard Stallman, the founder of the project, views GNU as a "technical means to a social end". Relatedly Lawrence Lessig states in his introduction to the 2nd edition of Stallman's book Free Software, Free Society that in it Stallman has written about "the social aspects of software and how Free Software can create community and social justice."
That sounds pretty political to me.