What are some common pitfalls in raising non-profit funding?

Raising non-profit funding can be counter intuitive. While one can justify the funding of a business based on ROI and other practical considerations, non-profit funding is often based on a sense of obligation. For example, if a donor asks what he or she gets in return for a gift, one logical answer would be the satisfaction of knowing that the money would be spent tackling a problem that the donor cares about. Other reasons for donating, stated or unstated, would include the satisfaction of letting the world know that you made the donation, thus enhancing your reputation.

Non-profit organizations need to be careful however, because donations can often come from unsavory individuals or institutions who are trying to improve their reputations. For example, a company that is a notorious polluter may be eager to improve their image by donating money to an organization that supports the environment. In such cases, the poor reputation of the individual or institution can damage the reputation of the non-profit organization. Another thing to be wary of is the strings that are attached to the money. A non-profit organization may find that they need to give up control or compromise on their objectives in order to secure a large donation. Clearly, non-profit funding can have some serious pitfalls.

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