Using Nonprofit Crowdfunding for General Operating Expenses

Crowdfunding and fundraising campaigns focused on projects and programs tend to perform better. Donors like to know what they are specifically donating to and the tangible outcomes and like to see their dollars go directly to a beneficiary or social impact program.

But the trend of fundraising only for programs is bad for nonprofits. As fundraising rockstar Dan Pallotta explains in one of the most-viewed TED talks of all time, there is a double standard in the nonprofit industry that hurts nonprofit salaries and standards.

Double standard: Donors typically like to see low overhead costs and general operating budgets, and therefore nonprofits like to highlight that the majority of their funding goes to programmatic expenses.

Yet you must have overhead expenses — such as salaries for operations and fundraising staff and office rent and supplies — to manage your programs successfully and to grow sustainably.

There are ways for you to successfully crowdfund for general operating expenses and explain to your donors why supporting your general costs are just as important as supporting a specific program. For example, Athletes for a Cure, a program at the Prostate Cancer Foundation, uses sporting events and challenges as an activity to raise funds.

Here are two ways you can also be successful when crowdfunding for general operating expenses.

1. Clear Need & Reasons

You can crowdfund for your general operating expenses, perhaps as a year-end fundraising campaign, or for more general funds such as medical research. But in these cases, you’ll need to make sure your ask is extra clear so that donors know what they are giving to. Discuss why your general operating costs are important for managing or scaling your programs, perhaps linking to the Overhead Myth.

2. Activity-Based Campaigns

You should make the campaign fun and interactive. Activity-based campaigns, such as races and walks, are popular for a reason and a great way to raise research and general funds. Any activity that is fun and a challenge can be used for these campaigns.

Don’t think that crowdfunding is not for you if you’re not currently fundraising for a project or program. Help educate your donors on why overhead matters, and get started now to increase your impact!