This chapter provides an overview of the nonprofit organization in the United States, the main characteristics of nonprofit organizations, and the reality of the nonprofit sector today. It describes the differences between a nonprofit and a for-profit corporation. Nonprofit organizations have existed for many centuries, especially through religious groups or religious-based activities. The nongovernmental sector is growing throughout the world. Increasingly, these organizations are playing key roles in the economic and social contexts of their countries. Unlike private-sector organizations concerned primarily with making a profit, nonprofit organizations are focused on carrying out a specific public-service mission. Successful nonprofit organizations require substantial capability in key areas of management: developing strong boards of directors, recruiting and motivating talented staff and volunteers, creating plans to focus resources on relevant goals and innovative programs, winning the support of diverse stakeholders, raising funds, and wisely managing fiscal and human resources.

The term “fund-raising” can be used for any activity whose primary purpose is to raise money to support the activity of a nonprofit organization. The meaning of the term “fund-raising” can change based on approaches used by a particular nonprofit organization. This chapter discusses why people donate to nonprofit organizations. The literature suggests that people donate to nonprofit organizations based on compassion, altruism, values, tax deductibility, corporate social responsibility, stewardship, and solicitation. The chapter identifies some common effective fund-raising strategies used by nonprofit organizations in the United States and describes the items in a fund-raising proposal. An effective fund-raising proposal requires effective planning. The planning of fund-raising activities should start with a fund-raising proposal that sets clear justification, goals, objectives, and overall approaches and strategies. Finally, the chapter provides conceptual frameworks and approaches to organize fund-raising activities that can generate alternative funding for financial sustainability.