4 Essentials to Secure Funding

Too many founders celebrate getting their 501(c)(3) like it's the finish line, but that IRS letter is just the beginning. At this stage, you're not qualified for a grant, but I'm going to share with you in this episode the four essentials that you need to make your nonprofit funder ready, legally compliant, and structurally sound.

Episode 149 | 4 Essentials to Secure Funding

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🔦 NONPROFIT SPOTLIGHT 🙌🏿

 First Fifteen Pt. 1

👉🏿https://firstfifteenla.com

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Got Questions? "Ask Amber" on any of my social media platforms or email me at [email protected].

Speaker 1 (00:00):

Too many founders celebrate getting their 501(c)(3) like it's the finish line, but that IRS letter is just the beginning. At this stage, you're not qualified for a grant, but I'm going to share with you in this episode the four essentials that you need to make your nonprofit funder ready, legally compliant, and structurally sound. Join me.

Speaker 2 (00:24):

Welcome to On Air with Amber Wynn, where nonprofit leaders learn to fuse passion and commitment with proven business strategies to create long-term funding impact and sustainability. And now here's your host and resident, Philanthrepreneur, Amber Wynn.

Speaker 1 (00:49):

Hey, it's your girl, Amber Wynn, and today we're talking about what you need in order to be funder ready. It's not enough just to have your 501(c)(3). There's so much more. You need four basic essential things. And listen to me, in my experience, and I got a lot - you need to be funder ready. It's not enough to have just your 501(c)(3). Everybody's got one of those. What you need is your infrastructure. Number one, what's included in infrastructure? Well, it's your mission. Your mission is what tells a funder if you are in alignment with their funding goals, right? Funders don't just fund everyone. They are very specific about the target audience, the geographical service area, all of the things that allow them to determine whether or not you fit in with their funding goals. So infrastructure is also your program description. You need to have measurable goals and objectives.

(01:49):

In order for a funder to determine if they're going to get a return on their investment, they need to know what is going to happen as a result of your program being in this community. Outside of that, your infrastructure, you also need a funder ready budget, not just any budget, a funder ready budget. What is the difference? Well, if you throw together some numbers, a funder's going to be able to understand that a funder ready budget really details what your priorities are, and you want to communicate responsible priorities to your funder. So number one, you want to have your infrastructure. Number two, you want to have a funder ready budget. When we come back, we're going to cover the other two essentials of the four essentials you need in order to be funder ready. When we come back, if you're just starting out and have limited resources, you may be tempted to use a volunteer based model for your nonprofit funders prefer paid staff because there's more accountability and consistency.

(02:51):

But if you want your proposal to be competitive, then having more than just volunteers who come and go is essential. Check out my building and effective nonprofit volunteer program toolkit. It provides all the essential elements of an effective nonprofit volunteer program. Things that demonstrate standardization, consistency and continuity. Learn how to develop a nonprofit volunteer program funders. Feel comfortable with funding. Order your copy today. Hey, we're back. It's your girl Amber Wynn, and today we're talking about the four essentials you need in order to be funder ready. Listen, I'm so excited that you got your 501(c)(3). It is a major milestone, but that's not all you need in order to get that grant that you're looking for. As a matter of fact, funders need to know that you can deliver on what it is that you promised and how do they know that it's your impact?

(03:44):

You're jumping into a ocean, not a puddle, an ocean of other nonprofits who's been doing the same thing or something similar for decades. And so you just having a 501(c)(3), it's not enough. You need to be able to demonstrate your impact. How are you going to do that with these four essentials? Before we went to the commercial break, I told you the first two, one was your infrastructure. The second was a funder ready budget. Number three, you need to have a seasoned board of directors. Listen to me. You may be the founder and you may be the one that essentially right now is doing all the work. But according to the IRS, it is the board of directors who is responsible for the visioning for making sure that the organization is running ethically. And for fundraising, you want to have a seasoned board because you want your partners in crime that's going to help you run this organization.

(04:40):

But most importantly, because the IRS has determined that it is your board who's responsible for the organization. So it's not enough to have just three people on your board, which is typically your mama and your cousin and your roommate. Those are not sufficient, okay? You want people who understand that their role is to help you as the executive director run your organization ethically. So number three is a seasoned board. The last of the four essentials are systems. Systems are probably more important than your staff right now. If you're just starting out, you got that 501(c)(3). I always encourage people, get your systems in place first. Why? Because they're able to help you tell your story. When a funder asks you for an impact report, your systems is the way that you do it. You collect your data, you put it in your CRM, which is your client relations management system, and then they spit out your reports and they say to a funder, listen, here is what happened in this community.

(05:44):

Here is what our programs delivered, and here is where the community is. As a result. Your systems, if they ask you for two years of financial statements, that comes from a system, it's an accounting system, whether it's QuickBooks, wave, it doesn't matter. You need systems to be able to deliver on a funder's request. So what are the four essentials? Say them with me. Four essentials. Number one is your infrastructure. Number two is your funder ready budget. Number three, a season board. And then number four, your systems. When we come back, we're going to talk about why you need to run your nonprofit like a business. When we come back, if your grants aren't getting funded, it could be because the funder can't see how your programs are making an impact in your community. Get the how to demonstrate Impact workbook to quantify the work you're doing in your community in a way that a funder can see a potential return on their investment.

(06:43):

Funders need proof that your organization will use their grant dollars to improve your community. That proof is called impact, and impact is quantified through measurable outcomes. Leverage my 30 years of program development experience to help increase your chance of securing funding. Order your copy today. Welcome back to On Air with Amber Wynn. Your girl is in the house, and today we are celebrating those individuals who got their 501(c)(3) we're celebrating by making sure that they understand it's not enough to have that 501(c)(3) tax exempt letter. In order to qualify for funding, what do you need to have? You need to have the four essentials. Number one, you need to have your infrastructure in place. Number two, you need to have the board of directors. Number three, you need to have a seasoned board. And then number four, you need to have systems. Now, right now I want to talk to you about something that a lot of nonprofit founders overlook.

(07:39):

Listen, when we start nonprofits in our community, we started with passion and commitment, and that's amazing. But the reality is, in order to get consistent funding, you need to run your nonprofit like a business because it is a business. It's just a business with an altruistic purpose, right? You're there for a purpose, but it is a business. You have to have marketing, you have to have HR, you have to have accounting. All of those things are the same things that a for-profit business needs to have, right? So when you come into this space, understand that it's not a business that you own. It's not when the IRS sanctioned public charity, if you are a 501(c)(3), number one, you don't own it. You never can because it is a public charity. That's why you're able to get the tax exempt status that allows your donors to receive the tax benefits.

(08:36):

So number one, if you're starting this 501(c)(3) because you think you're going to pass it down because you think it's going to make you wealthy, first of all, that ain't the case. But if you think that you're going to run your business any way that you want, number one, it's not your business. It is a public charity. So you just want to be in the know, right? A nonprofit has special rules and regulations. You have to report to certain governing agencies, the Secretary of State, the Attorney General, yes, the IRS, but you also have to report to all of these other agencies so that you can stay fully compliant. That is what makes a nonprofit a business. If it was just yours and you could just run it nilly willy, then hey, you go for what you know? But it is a business because you have authorized agencies that you have to file certain reports for.

(09:31):

So I want you to understand, coming into the space, that number one, you are competing with other organizations who've been in the space for a while, so you've got to demonstrate why you're better than them. Number two, you've got to understand that you have to submit compliance regulated documents. You have to, otherwise you'll lose the tax exempt status. So four essentials. Run your business like a business. And you may be saying, well, Amber, how do I know that? How do I get that? Where do I get that? I got you. I'm your girl. That's why I'm here. And that's why I've put together all of my 30 years of experience in a course called the Nonprofit Mastery Academy. And I take you from point A to point B. I'm going to drop the link in the bio. But the Nonprofit Mastery Academy was designed to help nonprofits understand what the requirements are, not only from the IRS, but from their funders to help them to create that infrastructure.

(10:35):

I was talking to you about. Listen, there's tons of information out there on the internet. Some of it are good, some of it's bad. I want to make sure that you don't waste hours of your precious time, thousands of your hard earned dollars to get it right. Let's get it right the first time. And the Nonprofit Mastery Academy can help you get there. Don't worry about it. I got you. Alright, so now we're going to move on to a commercial. But when we get back, we're going to talk about how to set up your systems that deliver on impact. Not sure how to price your programs or how to cover salaries. Are you scared to increase your program fees? If you're struggling to fully cover the cost of running your program, then you need “How to Price Your Programs for Profit”. This workbook provides step-by-step instructions for how to develop programs funders love to fund, determine the cost to charge for your programs and present salary costs in a way that funders will approve.

(11:33):

Learn the secret formula I used as an executive director for how to fully cover program costs. Order your copy today. Welcome back. You're On Air with Amber, and we talked about the four essentials that you needed to have, and one of them was systems. And I'm going to emphasize having systems. As I said, I encourage nonprofit organizations to invest in systems before you even hire staff. Why is that? Because your systems will help you get money. Listen, you're doing the work. My goal is to make sure that you get paid because when you are paid, then you have the energy, you have the resources to serve your community. I do not believe in nonprofit leaders suffering in order to serve their communities. I believe in you being compensated because when you're compensated, then you're paid and you're not working two jobs. So if you want to invest in anything, invest in your systems, what does that look like?

(12:37):

Well, you've got number one, your financials. If you have your 501(c)(3), one of the first things you need to do is to set up your bank account. In order for you to set up your bank account, you need to have all of your documentations, bank accounts, connect them then to QuickBooks Wave apps, whatever the accounting system is, that's going to allow you to track the transactions. So if you get money in, money goes out, you need to be able to create what are called financial statements that every funder's going to ask you for. Why? Because if a funder's writing you a check, they need to know that you are a professional business. Hence, you need to have your professional bank account. And they need to know that at any time during that grant period that you can tell them where their money is. They want to know how much you spent, how much is left to spend.

(13:26):

You can only do that with a system, a banking, an accounting system. So QuickBooks is the one that most people use, but there are tons of them out there. You need to be able to produce a financial statement. Financial statements only come from accounting systems. If you're going to have a staff, you're probably not going to have a staff at this early stage, but if you are, you're going to need some type of payroll system, right? That's going to document the number of hours that your people are working. You need to secure a CRM - a client relations management system. That's going to be the place where you put in all your data, you put in your data, then you can say to a funder, listen, since inception, these are the types of wins that I've had, the number of clients that I've served, the number of skills that we've taught, the number of placements that we have.

(14:19):

All of these things you need to put in a system. And you may say, well, Amber, I've got an Excel sheet. An Excel sheet is okay, but an Excel sheet can't track things like trends. A funder may say, tell us over the past X, Y, and Z period, how much money has come in, how much has gone out? When is your leanest time? You can do that with a system. It's hard to do that in an Excel sheet. So if I can encourage you to do four things, actually, right? I was going to say one thing, four things. I want you to start off strong. I want you to make sure that you have your infrastructure in place. I want you to make sure that you have a funder ready budget, not just some old raggedy schmageddy budget. I want you to have seasoned board members because it makes a difference. And I need you to make sure that you have your systems in place because that's going to allow you to answer those questions that the funder's asking you about statements and demonstrating their ROI. Alright, so now we get to move into the section where you get to ask me your pressing questions. It's called Ask Amber, and today's question comes from Justin. Let's hear Justin.

Speaker 3 (15:34):

Hi Amber. My name is Justin. I'm reaching out from Seattle. Can you explain the difference between a grant and a sponsorship? A corporation I approached for financial support replied and ask that, asked if I'm requesting a grant or sponsorship. I have no idea which to request. Thank you.

Speaker 1 (15:51):

Thank you, Justin. So what is the difference between a grant and a sponsorship? It's a couple of things. Number one, a grant typically has a specific period, a grant period that a funder is going to fund. Number two, you're going to have deliverables in exchange for this grant. You have got to give me something in return. A lot of people think grants are just free money. You don't have to pay them back. Let me tell you honey, grants feel like it's blood money sometimes because you're doing so much work to deliver on this request. And sometimes it feels like it's more effort than I'm not going to get started. So a grant has deliverables, whereas a sponsorship is usually about marketing. A funder is going to sponsor an event or sponsor a program and they're going to write you a check. In exchange, you'll do things like give them a feature on your website or you'll put their logo or you do a blast or something.

(16:47):

So the difference between a grant and a sponsorship is that a grant has deliverables. A sponsorship is about getting them visibility. Now, if you ask me, I'm going to tell you, you should have them both because every nonprofit should have 10 streams of revenue and you want to diversify your funding stream, right? Wonderful. Alright, so now we are moving into my favorite part of the episode where I get to put a spotlight on the most amazing individuals in the world. My nonprofit leaders, they're out there doing the work serving communities, and a lot of times they're not tooting their own horn. So that's what you got your girl for. Today, we have Jamila FirstFifteen and she's in the world of film and television, and she gives authors, writers the opportunity to get their information out there. So let's check out Jamila in part one of my nonprofit spotlight.

Speaker 4 (17:58):

So I had been living in Los Angeles for six years, a little over six years, and I had my social group in the city, but I was really missing that artistic community. And I had been coming from New York where I was just used to being in readings or running into people, “Oh, hey, let's go to this workshop.” And so there was just a vibrancy in New York that I was just trying to find in LA. And I just knew so many creative and just widely talented actors and writers, just dope people personally. But then they didn't know each other and they rarely got together to collaborate or to create. Everyone was just operating their own silos. And I just had this idea of, okay, I really just wanted to bring us all together. And so the idea came up about having a reading series,

Speaker 3 (18:45):

And

Speaker 4 (18:46):

I knew there was other reading series, but it was a cold reading series or the first 10 pages or 10 pages in anywhere in the script. But just had this idea because I talked to a writer who was excited but was a little nervous about sharing it maybe with strangers, the whole script. So I was like, well, what about the first 15 pages? How would that work? And so she was like, yeah, okay. I like that. I like that. And that's really is how it started in my friend's East Hollywood apartment. And we had the first one in March of 2019, and here we are, March, 2025. Still rolling.

Speaker 1 (19:38):

Welcome back. You're on air with Amber Wynn, and that was my first part of the conversation with Jamila Webb, the founder of FirstFifteen. If you are interested in me spotlighting, you can hit me up on any of my socials and I'd be happy to bring you on and interview you. So not just your specific clients can find you but funders. That's one of the reasons why I wanted to do Spotlight on Nonprofits because I need you to get out there and it is my job to help you so funders can find you. So hit me up on any of my socials and if you want to watch the full episode, go on over to my YouTube channel and you can watch the full episode. Otherwise, you can join me for the next three weeks where we continue our conversation with Jamila Webb. All right, my people, it is time for me to bring this to a close.

(20:29):

Today we've been talking about the four essentials that you need when you first start your 501(c)(3). I want you to be intentional. I want you to understand that it's not easier to start a nonprofit. It's probably harder. You've got to do more work. But what makes things hard in a is when founders don't understand what the requirements are. You cannot get into this space and start making things up and expect to get funded. That's going to derail you. So if you just got your 501(c)(3), just do your due diligence. If you're not sure I got you, check out the Nonprofit Mastery Academy. I'm going to leave the link in the bio. More than that, I want you to know it's difficult out there, but that's what I'm here for. I'm here to support the most amazing people on the planet, my nonprofit leaders. So now you're part of the family. If you've enjoyed what you've watched today, make sure that you share, share it with somebody in the community, and as always, take care of yourself, like you take care of your community. See you next week.

Speaker 2 (21:37):

Thanks for listening. If you enjoyed this episode, subscribe and leave a review on iTunes. Head over to www.amberwynn.net/podcast for the links and resources mentioned in today's podcast. See you next time.