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Email ThisIf you have read my blog before you know I think it’s important for nonprofit organizations to collaborate, and I feel the nonprofit sector may be becoming too flooded with nonprofits and I urge anyone that wants to start a new nonprofit to do their research. This is why I was surprised to hear one of my favorite bloggers declare, “We need new nonprofits to revitalize and grow the sector.”
Her article on Nonprofit Leadership 601 titled Reasons why you should start a nonprofit, goes on to say:
“Many of the new nonprofits starting up today will put other ineffective nonprofits out of business. These new nonprofits will come up with new and innovative ideas to solve old problems and they will do it in a more cost effective way while paying their employees a decent wage. Sector switching boomers and the younger generations are starting their own nonprofits. We don’t tell people they shouldn’t start small businesses so we certainly shouldn’t say don’t start a new nonprofit especially if the person who is starting the nonprofit will do a better job at running their nonprofit than the majority of nonprofits that are already out there.”
To be honest I think she makes some good points. We need innovation and entrepreneurship to reshape the nonprofit sector, but for some reason I’m still not completely convinced people should be starting new nonprofits to achieve this goal. I am skeptical to believe that everyone starting a new nonprofit will bring innovation and those are the new nonprofits I am most scared of for the sector. Recreating the wheel over and over will only dilute resources, but does this mean there is room for new innovative nonprofits instead of innovating the old ones?
Based on the traditional structure of the United State’s nonprofit sector, it doesn’t seem equipped for competition. I continually use the example of the public education system and how much it has been struggling due to increased competition between all schools in the country, many of which survive under very different circumstances. Competition is not helping here. But maybe it could for other small nonprofits. When I consider the factors of donations, etc I am still not convinced, a small business starting up has the opportunity to sell product based on their own criteria or that may take a lot of convincing to be funded, but new nonprofits have to sell a service, one that may already be served by another nonprofit, doesn’t this dilute the resources?
I don’t think the traditional model of business competition is right for the sector. What do you all think? Could it be good? 
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I’ve worked in both higher education (private and public) and for a national health organization – all non-profits. I think many nonprofits have a lot to learn about the best way to go about raising money. Many traditional/established nonprofits raise money very inefficiently - through events, walk-a-thons - etc, which require half of their staff and yearly operating budget. I think a leaner more efficient approach - at least to fundraising, would help make nonprofits more successful.
I definitely think the nonprofit sector could use some innovative organizations to keep them on their toes. I helped start a nonprofit called Gumball Capital - which engages students with entrepreneurship for social good through microfinance.
As an organization of college students, doing more research would have helped a great deal in the early stages. We stumbled as we trying to figure our our mission and vision, our strategy and our board of advisers. But at the same time, I think we are doing something that is very different, and will prove to be effective.
However, there are times when knowing less is better - a quote I often read about successful entrepreneurs is that if they had known how hard it would have been to make it, they wouldn’t have started. Sometimes you need to stay a little foolish.
This sounds a lot like how a consultant works - often trying to (re)move funding from those who are traditionally winning the work.
There is always room for competition as long as you’re innovative in using your found money, and good at convincing those who have the money that you’re more worth it. I think that the hardest part would be winning that first defining contract, after that it’s up to your own quality control.