Making money with Non-profit organizations

[oscar1075]

Hi,
Lately I've been wondering how do all those people that either create websites or start non-for profit organizations acquire capital to start them and continue them if their not making money, or how is it that they are making money of of their venture? How exactly does that work? Thanks

Oscar

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http://motivationforsuccessnow.blogspot.com

[chopper]

The whole point in non-profit organisations is that they don't make money! They are NON-PROFIT.
They are usually funded through donations, and any revenue they generate would be just to cover costs.

[jasaunders]

Non-profit doesn't mean the people running the organization don't make money, it just means the company itself is not in the business of making money, although it still can and usually does, but this money is not distributed to shareholders.
I work for a large nonprofit and believe me, there are a lot of people making a lot of money and the company itself makes a lot of money as the industry leader in its field. However, a large part of the money the company makes is invested for future expansion and capital improvements (as well as salaries). As a result, my company which is over 100 years old, rarely needs to take out a loan or has had any debt. Lots of money stockpiled away for a rainy day.

[MatteyBiz]

Yea, there are many colleges that are non profit as well. The college I go to is non profit and the president makes well over 100k/yr.

[EzMac]

Non-profit organizations may raise enough money to pay their employees and keep it running and growing, but if they end up doing it for commercial use, it's no longer non-profit.

[DrMoney]

This is true, they make money, but the purpose is not to.

[jonrubin]

you will definitely learn different when you take a college business course, many top non-profit employees make as much or more than any other chief executives.

[radreality]

on a slightly different note (since the main question has already been answered):

People who want to run a non-profit organization often start a regular corporation (S or C) after they get legal advice and financial advice. Since you don't pay any taxes with a regular corporation if there isn't any profit, you just make sure that the expenses are as high as the revenue or make sure you are able to justify accumulated earnings to the IRS. The main reason why non-profit organizations aren't always a popular choice is that they fall under a lot more scrutiny by the government and have public records. If you talk with an attorney who knows about this stuff there is also a way to be legally registered as a profit corporation yet qualify for 501 C 3 status (a type of non-profit) to take advantage of both the profit corporation advantages and the non-profit advantages.

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Robert Falk
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