The Secret First Steps To Forming Your Nonprofit's Founding Board Of Directors

Congratulations! You’ve developed your passion project into something that’s really helping people, or animals, or society, or your community.  You’ve planted a seed, it’s impacting a small corner of the world, and now you know it’s a “thing”.  Great job. But now what?

Now it’s decision time. You can keep doing what you’re doing as a passion project. Or you can grow it into something bigger – an entity, an institution, a movement – the possibilities are endless.  To do this though, you’re going to need to set up a structure – probably a nonprofit organization. This means a lot of different things and usually requires learning a lot of new skills and knowledge.

When starting a nonprofit organization, people usually think initially about things like the required legal and tax filings, programming and fundraising.   But another - incredibly important - and often neglected - early step is forming a strong Board of Directors.  A lot of nonprofit founders fill their initial board with friends and family. And then live to regret that decision. There are a lot of reasons for this (and we’ll explore more of the reasons in other articles), but one important reason that this happens is because aspiring nonprofit founders often don’t understand a Board’s role or how it can help the fledgling organization take shape.

So just what and who is your Board of Directors? Are they your boss? Are they your support system?  Are they just some names on a piece of paper or some people who you have to meet with a few times a year to be “real”?  Are they your employees? Your funders?  So many questions!

The not-so-helpful answer is that they are all of the above.  The more helpful answer is how your board can wear a variety of hats – all of which are there to help you as the organization’s founder and first Executive Director (whether or not that’s your title).

Technically, to form a nonprofit organization, you need to have a Board of Directors. In New York, you need to have at least 3 directors on your board.  The original board is listed in the Articles of Incorporation, so you need at least a bare bones board to get started.  They are your nonprofit organization’s fiduciaries – which means they have a legal duty to oversee the organization’s activities and spending to be sure that its operating correctly and in line with its mission and tax-exemption (or soon to be tax-exemption).  This is one of the reasons you have bylaws – to spell out the procedures for the board of directors to do just this.  

So, is the Board of Directors your boss? 

Of course they’re your boss. They approve your budget, your salary (if you have one) and the organization’s expenditures.  The buck stops with them. If the organization does something illegal, they’re on the hook. 

And, make no mistake, like any boss, they have the power to fire you.

But the Board of Directors is made up of volunteers, right? 

Usually, and ideally, yes. 

So, how can they be your boss if they aren’t really there on the ground with you?  Good question.  

Their job isn’t to manage your day-to-day work. As the nonprofit founder, you’re presumably really working as its Executive Director, whether or not you’re getting paid or have the title.  

You consult your board about big decisions – programmatic goals and directions, expenditures, contracts, events, etc. But they really aren’t involved in the rest of it unless you choose to engage them in those areas.  

So, let’s think of your Board of Directors as a super-high-up boss for now – who you need to get signoff from for the big decisions.

Unlike a typical boss though, the board can and should do a lot more for you and your new organization. They can wear a lot of hats, and each director can have different or overlapping hats. It’s up to you and them and the needs of your organization. Let’s break this down.

Hat #1: Support System  

This. Is. So. Important. Your initial Board of Directors joined up because they believe in you and your new organization’s mission. 

They may even help you define your organization’s mission. They want it to succeed, and you’re a big part of whether it succeeds.  

Directors are often just waiting for someone to need them, so go ahead and need them. Even just as a sounding board, especially just as a sounding board. The more you engage your directors for support, the more they can help you, and the more you will stumble on other hats they can and want to wear for your organization.  

Brainstorm: Think about the most inspiring conversations you’ve had about your new project.  Most likely, the other person was engaged, exciting and asking a lot of questions.  Have you started a list of people who seem excited about your project?  Have you reached out to find a way to engage them with the project? These are the first steps to recruiting directors.

Hat #2: Professional Advisor  

Everyone always says that you should recruit lawyers, accountants, and other professionals to serve on your board, and you should. They can provide you with pro bono services that are indispensable.  

But there are also so many other types of advisors out there, and you won’t know if you have them on hand unless you engage your board.  

For example, a director might have tons of experience throwing events, even if they aren’t fundraisers, and can guide you toward a process for organizing your events, vendors, locations, etc.  

Another director may work in a design or artistic field, or engage in design or art as a hobby.  He or she may be able to give you valuable input on your website, brochures, branding, logos, etc..  

The key here is that the director’s 9-5 job title may or may not make this clear, and you need to engage them to get to know all the ways they can help.  This can lead to…

Brainstorm: Now take a look at the list that you created in the last section. How can you get the people on that list engaged in your project in a way that would be meaningful to them? Hint: think of each of their unique talents, skills and interests and how they could help your new organization. 

Hat #3: Volunteer

Your directors are already volunteers for the organization. But sometimes people join a board because they really wantto be more involved and make a difference. 

These types of directors want to get their hands dirty, so to speak.  This is a gold mine in the beginning when you’re short hands and budgets to pay for more hands to help.  

Down the line, as your organization grows, these people may become leaders and committee organizers. 

For example, a director who likes networking may help you recruit more directors – attending lunches, reaching out to prospects, and attending events to spread the word. This person may ultimately chair your Board Nominating Committee.  

The same goes with a director who organizes events or gets involved with the program on the ground. They’re still on the board, so they’re still your oversight. But they’re now also working as an on the ground volunteer for the organization.

Brainstorm: Make a list of various leadership roles that you’d love to be able to fill for your organization.  Do you know anyone who might want to take on that role (or part of the role) as a volunteer or director? Hint: Don’t worry about the volunteer nature of the role. There are lots of ways to honor a volunteer or director – with a title, a plaque, a public shout out, prominent placement on your website, etc. 

Hat #4: Funders

This leads to an important distinction. Not all directors are looking to get involved on the ground.  

Some want to be involved only at that high level, i.e., attend board meetings and big events, have their name on the organization’s website. That’s fine, and some of your board should fall into this camp. But you still need to engage them, while respecting their wishes and time constraints. 

This is where a “give or get” policy comes in. The directors wearing Hat #2 and Hat #3 are “getting” the organization value.  Directors #4 should “give” to the organization – they are some of your first direct funders. But you will have to ask, and it’s helpful to have an actual policy requiring directors to give or get a minimum value for the organization. 

This policy will just be an idea that you keep in mind at first, but once you have an official board in place, they can vote on it, and then you have the all-important buy in.

Brainstorm: Who do you know with a big job and a bit heart, but not enough free time on their hands?  

Hat #5: Connectors

This is an important hat that you shouldn’t overlook. Some people are connectors by profession – they know a lot of people at foundations or others who regularly engage in philanthropy. They may have government experience and can help you get through the red tape of government grants and contracts.  

Sometimes a natural networker may not even have specific connections, but is willing and able to find them. Never undervalue the connectors and always give credit for this work – it’s a combination give and get, and it can snowball into much more.

Brainstorm: Go back to the list you started in the beginning. Who on this list seems like they would be a natural networker?

Hat #6: Future Leaders

At the outset of founding an organization, you’re looking for all the help you can get.   It’s hard to see that your organization may be around for a long time and grow into something bigger, even if that’s your dream for it.  

Every time you engage a director, you’re developing them into a leader for your organization.  This is true at board meetings, informal chats and when working together.  

So, in this sense, it’s like you’re their boss(or at least their guide) because it’s your job to engage them, grow their potential contributions to the organization and find opportunities for them engage on behalf of the organization.

Brainstorm:  Go back to your list every week or so. Add new people. But also add notes about each of the people on the list -  ideas for how to engage them, their skills and interests, roles they might fill now or in the future.

The happiest Executive Directors that I know understand and appreciate the value of allowing directors to wear different hats. 

They embrace it, develop strong relationships with their boards and engage each director individually.  This isn’t a one-time activity – it’s ongoing and a regular part of your job.  And if you do it, it will lead to a sense of calm and security because you know that you’ve got a team of supporters who are engaged – they can help you avoid mistakes, move the organization forward, and take some of the burden off of your shoulders. But only if you engage them!