Do you have a passion for making a difference in the world? There’s a fulfilling path for those eager to champion a cause they deeply care about.
Establishing a non-governmental organization (NGO) might just be the ideal route to realize such ambitions.
In exploring the impact of NGOs in society, this guide will provide insights into their roles and offer a straightforward overview of the steps involved in creating one. 
Whether it’s advocating for human rights, environmental conservation, or community development, forming an NGO can be a powerful way to channel your drive for positive change.
What Is an NGO?
How Do NGOs Work?
NGOs operate to fulfill various social objectives such as promoting human rights, environmental conservation, healthcare, education, poverty alleviation, and violence reduction.
Well-known examples include the Salvation Army and the American Red Cross. They depend on multiple funding sources like private donations, membership fees, and government grants.
There are primarily two types of NGOs:
- Operational NGOs: Focus on planning and executing development projects.
- Advocacy NGOs: Aim to influence public policies and promote specific causes.
Some NGOs function as both operational and advocacy entities.
In the U.S., NGOs are regulated by laws that require them to report their funding, management, and activities annually. Although NGOs can technically receive loans, securing such financing is challenging due to low repayment probabilities.
Are NGOs the Same as Nonprofits?
NGOs share similarities with nonprofit organizations but are not identical. Most NGOs operate as nonprofits, yet not all nonprofits qualify as NGOs.
NGOs typically center their efforts on promoting social welfare or the greater public good. Nonprofits, on the other hand, may have diverse focuses—ranging from the arts and science to commerce and research, some of which might not be geared toward social welfare, thus not fitting the NGO classification.
7 Essential Steps to Launch an NGO
Step 1: Defining Your Objective
The first step to launching a successful NGO is to clearly identify the cause you are passionate about and the goals you aim to achieve.
Assessing how much need there is for your NGO is crucial. There may already be multiple NGOs working in your area of interest that could use your support. Alternatively, you might discover that few organizations are addressing your chosen cause, making it an ideal gap for your NGO to fill.
Consider gaining experience by working or volunteering for an existing NGO in a related field.
Not only will this provide valuable insights, but it can also help you identify potential team and board members for your organization.
Engaging in free online NGO courses can further your understanding of NGO structure, governance, and other essential concepts.
Step 2: Develop a Strategic Plan
Having a solid plan is key to clarifying your vision and set attainable goals.
In this plan, outline the purpose and objectives of your organization. Ensure these goals are realistic and achievable.
A specific vision statement, as well as a list of goals and the steps to achieve them, should be included in your plan.
This statement will likely become a focal point for your website and fundraising activities.
Your vision statement and overall plan should reflect the knowledge you’ve gathered about challenges, history, politics, and other factors that impact your cause.
Step 3: Build Your Board of Directors
Recruiting experts in areas like accounting, fundraising, management, marketing, and technology is crucial.
Your board of directors should share your vision and bring the necessary expertise to make it a reality. A strong board is also essential for registering and operating a nonprofit organization legally.
Step 4: Legalize Your NGO
Making your NGO official involves registration, which typically requires providing basic information such as your organization’s name, purpose, board members, and organizational structure.
Drafting Articles of Incorporation and Bylaws may also be necessary. This stage is also a good time to secure any required permits and licenses to operate.
Step 5: Obtain Tax-Exempt Status
NGOs are generally eligible for federal and state tax-exempt status due to their nonprofit nature.
Many NGOs qualify for 501(c)(3) status, allowing donors to deduct their contributions from taxes.
Applying for tax-exempt status, including 501(c)(3) via the IRS, involves considerable paperwork and time. Legal counsel can assist with this process.
In some states, NGOs must register with a state charity official. Detailed guidelines and instructions can be found on the IRS website.
If filing for tax-exempt status feels premature, consider seeking sponsorship from an established NGO, allowing donations and grants to be tax-deductible while you operate under their umbrella.
Step 6: Create an Impressive Website
A well-designed website is essential for communicating your mission and attracting donors.
Invest in a good designer and ensure a seamless user experience. Your website will be a critical resource for anyone interested in learning about your NGO and potentially contributing to your cause.
Step 7: Establish a Financial Plan
With your objectives defined and paperwork completed, the next step is figuring out the financial aspects.
This includes funding projects, operating costs, staff salaries, and other overheads.
While many NGOs rely heavily on volunteers, an operating budget is necessary to manage these volunteers effectively.
Many NGOs manage budgets in the millions—even billions—of dollars. Understanding how much money is needed to maintain operations, manage volunteers, and continue fundraising is critical for the success of your NGO.
Recommended: Nonprofit vs. Foundations
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Securing Funds for Your NGO
Grants
Applying for grants from foundations can be a key source of funding.
Research and identify organizations that support causes similar to your NGO’s mission. Tailor your proposals to highlight how your work aligns with their priorities.
Private Donations
Private donations come from individuals, corporations, and charitable organizations.
These contributions can range from large gifts to small, recurring donations from supporters. Building a strong network of donors who are passionate about your cause can provide a steady stream of funding.
Government Funding
Government grants and contracts can offer significant financial support. NGOs often qualify for these funds while maintaining their independence.
Familiarize yourself with government programs and application processes to take advantage of these opportunities.
The Takeaway
NGOs can be broadly categorized into two types: Operational and Advocacy.
Operational NGOs are dedicated to executing development projects, focusing on tangible improvements in various regions.
Advocacy NGOs, on the other hand, are dedicated to championing specific causes and influencing policy changes.
Despite being independent of governments, NGOs often receive funding from various sources, including government grants.
Starting an NGO requires thorough research and a well-thought-out plan to be effective and sustainable.
For those looking into financing options for their initiatives, platforms like SoFi offer a marketplace to explore and secure personalized business financing options in just a few minutes.
Really appreciate this guide on launching an NGO. Clear steps and super helpful!