The Importance of Sponsors for Nonprofits and their Communities

Donors and sponsors are the backbones of many of the nation's nonprofit organizations. Nonprofits must have multiple streams of income, not only so that they can sustain their programs but also so that they are not solely dependent on private giving. However, this is easier said than done for lots of organizations. Depending on the organization's size and sector, donations and private giving can make up anywhere from 12-72% of a nonprofit's budget. According to a Candid article from 2019, nonprofits have begun to rely more on major gift donors. Businesses often benefit from the publicity that sponsoring a nonprofit event or program can provide, but there are also several benefits for the nonprofit and the community.

What are Sponsors?

While sponsors can also be one of the organization's donors, there is a slight difference between the two. The donor is the umbrella term for anyone who donates to a nonprofit organization. A sponsor usually donates a certain amount to facilitate a particular event or program. In addition to providing donors with publicity, sponsors generally receive free admission into the event or program and may receive a few additional perks. Typically, nonprofits create sponsorship tiers that outline what each sponsor receives and the financial commitment necessary to secure their bonuses.

How Can Sponsors Give?

Depending on the organization and its event/program, the sponsor may be able to give monetarily or with an in-kind donation. In-kind donations are non-cash gifts made to a nonprofit organization or other charity. This donation can include goods, services, expertise, and time. While one organization may require its sponsors to donate $500 or more, another organization may count a donation of $500 worth of goods or services as a sponsorship donation.

Impact on Local Nonprofits

Not only do sponsors help to implement and facilitate events and programs and secure the organization's scalability, but nonprofit organizations may also depend on sponsors for fundraising ventures. Sponsors can be very well connected in the community. They may be asked to assist with an organization's peer-to-peer fundraising efforts. Peer-to-peer fundraising is when one of the nonprofit's advocates asks their network of friends, family, co-workers, and other peers to donate to the nonprofit.

Similarly, since many sponsors have their own built-in audience, securing sponsors can help the organization spread awareness of its goal and mission. For example, when patrons see their favorite bookstore affiliated with a local nonprofit, it is more likely that they will take an interest in that organization's work.

Event and program sponsors can also build mutually beneficial relationships with the nonprofit organization. For example, suppose a restaurant sponsors a nonprofit's event. In that case, it is more likely that the nonprofit's employees will have their next lunch meeting there or consider the restaurant to cater their next Lunch and Learn.

Impact on the Community

The most significant impact that an event or program sponsor has on the community is that they are helping to fund programs that directly benefit that community. Without local sponsors, nonprofit organizations would be severely limited in their offered programming. Sponsors make nonprofit work possible with their continued support.

Not only do these programs mean that the nonprofit and its clients will support the sponsor's business, but it also means that the nonprofit can support other small businesses in the community. For example, suppose a nonprofit is fully sponsored for its concert in the park event. In that case, they will likely look into local businesses to take care of event setup, catering, security, and other needs. Every dollar spent within the neighborhood continues to pour back into the community!