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    • TheKaitiakiProject

      Business Owner

      @thekaitiakiproject

      How can i take our business to a non for profit

      Question submitted 02/06/21 @ 05:57pm

      We are currently operating as a business but in order to apply for funding to be sustainable we need to have a charity status. Our kaupapa provides a free well-being hikoi and of course with the expenses following it currently isn't sustainable.

      Category: Māori Enterprise
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      • Andrew Hamilton

        Admin

        @andyadmin

        Reply submitted 02/06/21 @ 05:57pm

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        Morena – I know a number of organisations have faced the issue that if they are not a Charity (registered) or an Incorporated Society (and potential also registered as a charity) then some funding organisations will not be able to fund their activities – however there are funders who are ok not funding registered charities. Under legislation there are clear requirements around charity registration – and there is a cost to doing that. I suspect when you sit back and look at your kaupapa it is important to separate ‘who benefits from this’ and ‘who can fund it’ – and if they are separate people, then looking at your total market for funders and what they are prepared to fund and what they are allowed to fund will lead you to a conclusion around whether you need to be registered or not. If you do, then finding support from groups in your region, area including a local lawyer may enable you to short-circuit the process. Also talk to other charities that have gone through the process and/or approach the Government Charities Organisation.

        My challenge to you in the interim is – find funders who so believe in what you are doing, that they will still fund you even if you are not a registered charity. Then build up reserves to enable you to go and fund the registration and investigation as to whether your activities can be a charity.

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      • Louise Aitken

        Industry Expert

        @louise_aitken

        Reply submitted 02/06/21 @ 05:57pm

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        I agree with Andy – it is great advice. Being a charity comes with a lot of cost, ensuring you adhere to the Charities Act, especially at the end of each financial year.

        There is a lot you can do when sitting back and looking at your business and your impact. Check out The Impact Initiative website for a lot of tools that will be really useful.

        Start with this one: https://www.theimpactinitiative.org.nz/toolkit-for-se/models-for-se

        Ngā mihi nui,

        Lou

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      • Sandy Thompson

        Industry Expert

        @sandy-thompson

        Reply submitted 02/06/21 @ 05:57pm

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        Can I acknowledge you are doing an amazing thing supporting your whanau to be the best they can be. I agree there are some funders who will fund small community based initiatives that are not registered charities. The website https://generosity.org.nz/ is a database of potential sources of funding. My sense is you would be eligible for COGs funding as they often fund projects that are grassroots such as yours. https://www.communitymatters.govt.nz/community-organisations-grants-scheme/

        I have worked with groups doing mahi such as yours who ask one of their more computer literate community members to set up a give a little page where people can donate. Getting people to sponsor individuals and whanau who participate in hikoi could be a feasible option. check out https://givealittle.co.nz/. These folk may be able to help you as well: https://foundation.vodafone.co.nz/

        If you do decide you want to register to be a charity your local community law office will be able to give you some advice.

        All the best
        Sandy

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      • Grant Johnson

        Industry Expert

        @grant-johnson

        Reply submitted 02/06/21 @ 05:57pm

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        Kia ora

        I’ll leave it to the experts regarding the ins and outs of the organisation types (charity vs business) but looking at your facebook page it looks like you have the potential to tell great stories of lives impacted and changed which could inspire others to support you regardless of your formal organisation structure. For example, by positioning as a social enterprise you are are making a mark in the sand that to potential supporters that profits are used to further your work.

        Looking at your Facebook page I could see stories of gathering, healing and connecting with nature but I didn’t get a full picture of what you are about. You have beautiful designs, great photos and cool videos and I wonder if you could collate these stories onto your website to tell your story as to who you are, what you are doing and the lives changed which may make it a lot easier to bring on the supporters that Andy mentions who are keen to support you based on your heart and purpose rather than your charitable status.

        As an example I was speaking to a man yesterday who is a trustee of a trust that earns income from a farm that was left as a legacy by the farmer. He was asking about potential organisations to support as they have a big build up of cash. I told him about some of the organisations that I know of that met the giving criteria of the trust and the first thing he was going to do was check out the websites of those organisations.

        This may sound like a sell job coming from a website guy! Trust me it’s not. We recently offered 750 websites to our partner network to pass onto not for profit organisations who making the world a better place (they don’t need to be charities) and if you contacted us with a little more info about what you’re up to we could connect you with potential partners who would be interested in helping. Learn more here: https://www.rocketspark.com/blog/post/314/rocketspark-design-partners-gift-it-forward/.

        Depending on where you are based you might want to check out these organisations which are geared up to connect you with advisors that could help you in your journey to understand charitable status:

        Home

        Home



        I hope that helps.

        Kind regards

        Grant

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      • Andrew Hamilton

        Admin

        @andyadmin

        Reply submitted 02/06/21 @ 05:57pm

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        Morena – here is an answer from one of our Advisors, who can’t get on the platform right now to respond (our IT issues!), but wanted you to have this: from Chibuiike Emmanuel

        Hi

        I may still need further clarity to understand the full nature of your business to give you enough context.

        But in the meanwhile let me start by saying do not make a permanent decision on a temporary situation. Unless in the first instance there wasn’t a sustainable business model behind your venture – something that you can exchange value for ,get paid and make a profit from an appropriate market size .

        The flip side of the coin also is that if you become a full blown non-profit that you may lose several funds as well that are dedicated to for profit ventures.

        I do understand that it is hard for for-profit business to raise funds but there may grants and facilities that may help you through the teething phase (as a role of the thumb however you need to show that you have skin in the game and have aptly put in your own resource). I know because I have gotten grants for for-profits -with a social or environmental mission at its core (will share more about this )

        If you started off as a ‘business’ , this may mean that at your core you aren’t originally intend to function as a non profit. Hence I will advise that you look at a social enterprise model. Please see the document from the link below :

        https://www.dia.govt.nz/pubforms.nsf/URL/Legal-entities-for-social-enterprises.doc/$file/Legal-entities-for-social-enterprises.doc

        You may pay more attention to
        – Charitable trust boards (which is even apt for people that don’t want to pull out profit from the venture so leans towards the non profit model)
        and
        -Limited liability Companies

        The intersection of business and social good will continue to converge more in the coming years.

        An instance is my newest start-up which craters to underserved smallholder farmers. Even though we are a for profit social enterprise, we are sure that we may not make profit for a while because of the peculiar nature of the space we operated in and our business model. It will even take a while to achieve certain milestones in order to be considered investible by investors.

        Some people have asked us why we are not a non profit because it seems easier to compete for grants at this time . The answer is that eventually it may get back to bite us because we may not be very sustainable in the long haul .We also know that down the road we will need heavy sized investment tickets to fully build out our proposition and scale rapidly. But we have got our first grant (a small grant) and now at the final stage of getting another grant that may run into hundreds of thousands of dollars.

        So there are now funds targeted at social enterprises even for profit ventures. I do know some in the global space and we can research together to find out the ones specific to New Zealand (please let me know)

        Thank you for all that you do for your community .Please do not give up.

        Best,
        Chibuiike

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