As the founder and president of Organizational Sustainability Consulting, Ari Betof provides consultations and guidance to senior executives in nonprofit organizations. Financial modeling is one of the key areas where he puts his expertise to work. As a consultant, Ari Betof ensures that leaders learn how to handle financial challenges in order to overcome them.
Nonprofits typically have fewer resources and less funding, prompting them to rely on donations, fundraisers, and grants. Finding sources and donors is just one challenge. Managing what little resources they have is another.
Finding a Regular Source of Funding
For nonprofits, it’s common to have multiple funding sources. Executives and board members need to have a clear strategy for maintaining the flow of funding from existing sources while looking for new supporters at the same time. They must be able to determine which sources to rely on for long-term sustainability and which sources are temporary.
Insufficient Collaboration
Many nonprofits tend to become too invested in the mission and forget about what makes fulfilling the mission possible in the first place. More often than not, those in the finance and accounting department are not involved in the client-facing work and may not receive frequent updates. All departments in a nonprofit should have a solid communication and collaboration system to ensure all aspects are handled, especially when planning a budget and distribution of funds.
Misconception on Sustainability
For many nonprofits, sustainability means having resources, no matter where they come from, and this makes them largely dependent on sponsors and grant makers. True sustainability is the ability to reduce reliance on a single source of funding. This diversification can be possible through proper assessment, planning, and optimization.
