SCORE: America’s Counselors to Small Businesses

1. SCORE: America’s Counselors to Small Businesses

2. SCORE: America’s Counselors toSmall Businesses • Founded in 1964 • 330 chapters nationwide • 11,000 volunteers • 360,000 clients served annually • 20,000 new businesses • 25,000 new jobs • Free counseling, face-to-face, email • Confidentiality • Both for profit and non-profit

3. Cleveland SCORE: An Overview • In 2014 39 Counselors • 548 Face-to-Face Clients • 414 Follow on Meetings • 50 Workshops with 783 Attendees • 1470 Counseling Hours • 1705 Total services provided • Serve Cuyahoga, Lake, Huron, Astabula, Lorain, Erie, and Geauga counties

4. Basics For Launching a Non-Profit

5. Section 501(c)(3) Organizations Exempt purposes include: • Religious • Charitable • Scientific • Testing for public safety • Literary and artistic • Educational • Foster national or international sports competitions • Prevention of cruelty and abuse to adults, children or animals

6. Section 501(c)(3) Organizations Qualifications: • Organized specifically for exempt purposes • Corporation (including LLC), trust or unincorporated association • Organizing document limits entity’s purpose • Specific, IRS-recommended language • By Laws • Conflict of Interest policy • Must have a board of directors/trustees

7. Section 501(c)(3) Organizations Public charities are: • Organizations that receive substantial support from grants, governmental units and/or contributions from the general public • Organizations that normally receive more than 1/3 of their support from contributions, membership fees and gross receipts from activities related to their exempt functions and not more than 1/3 from investment income and unrelated business income

8. Section 501(c)(3) Organizations Operated to support exempt purposes in organizing document • Prohibited activities include: • Lobbying, political campaigning (some is permitted) • Unjustly enriching board members, officers, key employees • Primarily operating a trade or business not related to exempt purpose

9. Section 501(c)(3) Organizations Obtaining tax-exempt status: • Choose organization form and document it • Register with Ohio Secretary of State • www.sos.state.oh.us • Obtain Employer Identification Number (IRS website)…www.IRS.gov NOT “irs.com” • File IRS Form 1023 (or 1023EZ) – which? • When to file • Filing fees ($850 for long; $400 for EZ) • How long will you wait?

10. Section 501(c)(3) Organizations Resources: Accountants-Attorneys-Insurance-Licenses • www.IRS.gov (not irs.com) • Pub 557 Tax-Exempt Status for Your Organization • Form 1023 and Form 1023 Instructions (or EZ if applicable) • Guide to Starting a Non-Profit in Ohio • TechSoup.org…Guidestar.org….others

11. Section 501(c)(3) Organizations Contact Ohio Attorney General if you will engage in solicitation. www.ohioattorneygeneral.com • Apply for nonprofit postal permit from the United State Postal Service at www.usps.com.

12. Challenges for Launching a Non-Profit • Finite pool of funding • For each 501(c)(3) in the US, there are JUST 150 households • Competition from existing non-profits • Need to make service/product unique to obtain both clients and funding • Difficulty in recruiting and retaining qualified and dedicated board members • Opportunities for cooperation or collaboration • How to find them?

13. Creating a Business Plan

14. Key Elements of a Business Plan Human Resources

15. Key Elements of a Business Plan • Mission statement and/or vision statement so you can articulate what you’re trying to create; • Description of your company and product or service; • Description of how your product or service is different; • Market analysis that discusses the market you’re trying to enter, competitors, where you fit, and what type of market share you believe you can secure • Description of your board/management team, including the experience of key team members and previous successes; • How you plan to market the product or service;

16. Key Elements of a Business Plan • Analysis of your company’s strengths, weaknesses, opportunities, and threats • Funding/Revenue/Expense projections • Develop a cash flow statement so you understand what your needs are now and will be in the future • Summary/conclusion that wraps everything together (this also could be an executive summary at the beginning of the plan)

17. Business Plan • Reminders • Use simple language; avoid jargon • Treat as living document • Update annually or more often if circumstances warrant • Creation • Unexpected benefit–the process • As important as the finished plan • Additional rigor to thinking

18. Section 501(c)(3) Organizations Financial reporting is different from for-profits • Report activities rather than earnings • Effort to keep cost of administration low by recruiting volunteers rather than paid staff • Fundraising, donations & gifts, grants • Management of funds is critical to success

19. Mission Statement Major difference

20. Importance of Mission Statement “If you don’t know where you’re going, it doesn’t matter which way you go.” -Cheshire Cat, Alice in Wonderland • Summarizes the good that the business intends to bring to the world • Constant reminder why the business exists

21. Creating the Mission Statement • What will your business do? • How will your business do it? • What will be the outcome?

22. Mission Statement Examples American Red Cross - The Mission of the American Red Cross is to improve the quality of human life; to enhance self-reliance and concern for others; and to help people avoid, prepare for, and cope with emergencies. It does this through services that are governed and directed by volunteers and are consistent with its congressional charter and the principles of the International Red Cross.

23. Test Mission Statement • Does your company’s mission statement represent what it intends to do? • Does the mission statement “sound like us?”

24. Organization Boards: & Best Practices Summary : profit & non-profit small to large sizes where are you? where will you be?

25. Why do I need a board

26. Ten Responsibilities • Determine mission and purpose • Select the chief executive • Support and evaluate the CEO • Ensure effective planning • Monitor and strengthen programs and services

27. Ten Responsibilities (cont.) • Ensure adequate financial resources • Protect assets and provide proper financial oversight • Build a competent board • Ensure legal and ethical integrity • Enhance the organization’s public standing Source: BoardSource.org

28. Whose Job Is It?? • Well defined roles • All board members • Specific member roles, Chair, Treasurer, Etc. • Committees • Executive Director • Others

29. Who Are They?... Depends… • Funding? • Volunteers? • Marketing Assistance? • Financial Expertise? • Legal? • HR? Needs May Evolve Over Time

30. Other Criteria • Passionate • Expertise • Diversity • Representative What can they bring to the table?

31. WhatCode of Ethics • Leadership • Selflessness • Integrity • Objectivity • Accountability • Honesty • Source: BoardSource.org

32. Self Evaluate

33. Where Do You Find Them? • Who cares about your mission? • Volunteer Center • Place of Worship • Everyone knows at least 250 others! • BOGO!

34. How do you recruit them? • Articulate the mission • Show them/engage them • Thoroughly explain the role and expectations • “I/they need your help” • Can you suggest someone?

35. What Then? Orientation! • Mission & Purpose • Programs • Roles & expectations • Terms • Commitees & roles • Calendar • Formal Plans

36. Orientation • Financial statements • Minutes • Documents: By-laws, operating agreements • Scorecard • Opportunities & Challenges

37. HowOrganizational Structure

38. Sample Organization Chart Outreach Fund Raising Staff Volunteers

39. Sample Board Roles • Chair • PR • Ways and means • Financial • Personnel • Volunteer recruiting • Bylaws • Secretary • Training • Outreach • Programs • Facilities • Scheduling • Audit • others Board size depends on function, roles and needs

40. Strong, Committed, Talented & Engaged Boards = Success!!!

41. Fund Raising

42. $ Funding $ • The number one cause of sleep loss! • Where will it come from? • Not from trees!

43. 2013 Philanthropy in America$335 Billion Source: National Philanthropic Trust

44. 2015 Trends Individual +4.4% Corporate Equal Foundations + 5.7%

45. 2015 Trends Religion 31% Education 16% (biggest increase 8.9%) Human services 12% Grant making foundations 11%

46. Sources • Program service revenue -73% (including government contracts and fees) • Contributions, gifts and government grants - 21% • Dues, special event income, rental income, and net sales of goods - 6% Source: National Philanthropic Trust

47. Special Events Caution • Golf outings, 5K’s, “-athons”, etc. • Friend raiser/fundraiser/awareness builder? • Cost per dollar raised?

48. Creative Solutions • Trend= Young Professional Organizations (YPO’s) • Research= what motivates Millennials? • Learned= Care about community, want to do their “thing” and manage their projects, social media • Result= “Low cost” revenue

49. Capacity Building Building up skills and abilities, such as decision making, policy-formulation, appraisal, and learning. Capacity building is a way to strengthen an organization so that it can perform the specific mission it has set out to do and thus survive as an organization. Source:Wikipedia.org

50. PLAN And plan some more! • Continue to learn • Know the trends • Do your research • Build your network