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Knowledge Base

Q:
How are nonprofits funded?
A:

Nonprofits can and do utilize the following sources of income to help them fulfill their missions:

  • Fees for goods and/or services
  • Individual donations and major gifts
  • Bequests
  • Corporate contributions
  • Foundation grants
  • Government grants and contracts
  • Interest from investments
  • Loans/program-related investments (PRIs)
  • Tax revenue
  • Membership dues and fees

While opinion varies as to what a nonprofit's "ideal" mix is, utilizing several diverse sources to achieve sustainability is generally a good practice. The National Center for Charitable Statistics' Nonprofit Sector in Brief 2014 provides a pie chart showing the percentages of various sources of nonprofit revenue for 2014 (the latest year of record):

Nonprofit Revenue, 2014

See our related Knowledge Base Articles:

- Where can I learn more about fundraising planning?
- What is a program-related investment?
- What is strategic planning? Where can I learn more about it?

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