Job Description of the CEO of a Nonprofit Startup

by Sam Ashe-Edmunds

The CEO of a nonprofit organization, often called an executive director, faces most of the same challenges that an entrepreneur faces when launching a business. In addition to developing a business plan, creating budgets, hiring staff and creating an organizational structure, the CEO of a not-for-profit organization must follow the state and federal rules and regulations governing nonprofits.


Even nonprofits must have comprehensive marketing plans to guide them in their operational and fundraising efforts. Advertising is only the tail end of a marketing plan; creating the organization’s mission and identifying its stakeholders are key parts of the front end of a marketing plan. A nonprofit has a “product” it wants to promote to a target audience -- namely, its cause. Creating a marketing plan for a nonprofit includes drafting the organization’s mission statement, determining who its target volunteer and donor base will be, listing the activities it will pursue and creating communications efforts to spread the word to attract support. Part of this process will include drafting bylaws for the organization, which clearly set its rules for operating and pursuing its mission.


Creating a nonprofit corporation starts with filing for recognition at the state level. This requires filling out forms that include an Articles of Incorporation document, which tells the secretary of state’s office about the proposed organization, such as its mission, location and board members. Once the organization receives corporate status, the CEO will file for a local business permit and a federal tax identification number. This level of nonprofit recognition is enough for many small nonprofits that raise small amounts of money, usually less than $25,000, that don’t accept large charitable contributions that require a tax write off. State-level incorporation provides benefits such as not having to pay state sales and income taxes. If the organization wants federal tax-exempt recognition and charitable status, the CEO will determine which IRS 501(c) classification is best for the organization and file the paperwork to obtain it.


The CEO of a nonprofit startup will create a master budget and departmental budgets for review by the treasurer, finance committee and board of directors. If the CEO does not have a separate development director or staff, she will be responsible for setting the revenue goals, which might include donations, grants, interest from an endowment, sponsorship sales and fundraising activities.


Once the organization is formed, the CEO will work to staff the organization and recruit volunteers. The CEO is usually a paid staff member guided by volunteer board members. The board sets the direction and goals of the association, and then the CEO executes the work needed to reach these goals. The CEO of a startup will determine what positions to fill with paid staff, where to use volunteers and what functions to outsource until the organization has enough money to bring those functions in house.

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