Nonprofit Organizations

Learning Target

I will be able to explain what nonprofit organizations are and

how they differ from for-profit organizations.
 Do Now

1. Which nonprofit organizations have you heard of before?

2. Have you ever volunteered with or donated to those or
any other nonprofits?
Nonprofit Organization: entities established to serve the public good,
community, or a specific cause, rather than generating a profit

Non-profits are mission-driven, and work towards achieving specific

environmental, social, or community-based goals
 There are approximately 1.54 million nonprofit organizations
registered in the United States

While these organizations vary in size, from small, local charities to

large, international organizations, approximately 70% are smaller
organizations with revenues below $50,000 per year
 Nonprofits and Society
Nonprofits play a significant role in addressing societal needs and
promoting social change

In addition, nonprofits collaborate with government, businesses, and

other organizations to achieve their mission
 The main types of nonprofits include:
1. Charitable Organizations
2. Educational Organizations
3. Environmental Organizations
4. Health and Human Service Organizations
 1. Charitable Organizations
These organizations focus on providing aid, support, and services to
disadvantaged populations or specific causes

Examples include:
• American Red Cross, which provides disaster relief, blood
donations, support to military families, and health and safety
training
• Save the Children, which focuses on improving the lives of children
in need, providing them with education, healthcare, and emergency
response
 2. Educational Organizations
These organizations are dedicated to promoting education and skill
development in communities

Examples include:
• Khan Academy, which offers free online educational resources and
courses to support learning worldwide
• National Geographic Society, which promotes education and
exploration of national history, geography, and culture
 3. Environmental Organizations
These organizations are committed to preserving and protecting the
environment and natural resources

Examples include:
• World Wildlife Fund (WWF), which works to protect endangered
species, conserve habitats, and address environmental threats
• The Nature Conservancy, which focuses on preserving ecologically
important lands and waters and promoting sustainable practices
 4. Health and Human Service Organizations
These organizations provide medical care, social services, and
support to individuals in need

Examples include:
• United Way, which supports various community services, including
food banks, emergency shelters, and health programs
• Doctors Without Borders, which provides medical aid and
assistance to people affected by conflict, epidemics, and disasters
 Nonprofits vs. For-Profit Organizations
Nonprofits differ for for-profit organizations in the following
categories:
• Purpose and Mission
• Funding Sources
• Financial Distribution
• Tax Status
• Workers
 Purpose and Mission
The purpose of most for-profit organizations is to make a profit,
which means earning revenue that is higher than expenses. Profit
serves as the measure of success, and are usually shared with owners,
shareholders, and employees

While nonprofits also earn revenue and have expenses, the purpose
of nonprofits is instead to serve the public or address societal needs
 Funding Sources
Nonprofits rely on donations, fundraising, and grants, while for-profit
organizations generate revenue from selling goods and services
 Financial Distribution
Nonprofits reinvest any surpluses back into the organization and
mission, while for-profit organizations distribute profits to owners,
shareholders, and/or employees
 Tax Status
Nonprofits enjoy tax-exempt status if they meet specific
requirements, while for-profit organizations are subject to taxation

In addition, donors to charitable organizations may be able to deduct

their contributions from their federal taxes
 Workers
While those that work at businesses are usually paid employees, the
majority of the workforce at nonprofits is made up of volunteers

However, most nonprofits employ professionals such as a

professional leader, fundraising and marketing staff, business staff
such as an accountant, and highly trained people to carry out
programs, such as education, health services, and therapeutic services
However, volunteers are more than just unpaid workers, as they often
become the best donors. Volunteers therefore serve two roles: helping
the organization with staffing and supporting the nonprofit through
contributions ranging from cash donations to bequests through their
wills
 “By definition, nonprofits are not in the business of financial gain.
We’re in the business of doing good. However, nonprofits are still
businesses in every other sense – they employ people, they take in
revenue, they produce goods and services and contribute in significant
ways to our region’s economic stability and growth.”

– Chuck Bean, former executive director of the Nonprofit Roundtable

 In recent years, hybrid business organizations have appeared that
blur the lines between for-profit and nonprofit organizations.
Examples include B Corporations and businesses that have a social
purpose
 Some of the most popular nonprofits in the U.S. include:
• American Cancer Society
• American Heart Association
• American Red Cross
• Americares
• Boys & Girls Clubs of
America
• Direct Relief
• Doctor’s Without Borders
• Feed the Children
• Feeding America
• Habitat for Humanity
• The Rotary Foundation
• The Salvation Army
• Save the Children
• St. Jude’s Children's Research
Hospital
• United Way
• World Wildlife Fund
• Wounded Warrior Project
• YMCA of America
 Quick Write!

Which nonprofits would you like to learn more about?

 Activity: Nonprofit Research
Directions: Choose a nonprofit organization to learn more about. Use
the internet to research this organization. Then, answer the following
questions:

1. What is its mission?

2. How does it conduct its mission?
3. What are some of its successes?
4. What is one interesting fact you learned about the nonprofit?
 Activity: What is the Profit in Nonprofits?
Directions: Watch the TED Talk “What’s the Profit in Nonprofits?”
by Areva Martin. Then, answer the following question:

According to the video, what is the profit in nonprofits?

Link to Video:
 Summary

Explain how nonprofit organizations differ from for-profit

organizations.