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The title of the article next to an illustration of people putting a puzzle together, representing nonprofit capacity building.

Nonprofit Capacity Building: How to Grow Your Organization

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When researching nonprofit capacity building, the definitions you find may seem a bit vague. You may hear the term at a board meeting, fundraising team gathering, or networking event and wonder “What exactly defines my nonprofit’s capacity, and why is it so important to build?”

The truth is that many definitions of nonprofit capacity building are very generalized because the term means different things in the context of different organizations. What allows an animal shelter to grow and support its mission may look much different from what an environmental organization, museum, or public school needs to thrive.

No matter what type of nonprofit you run, here’s what you’ll need to know about capacity building:

To help your organization forge its own path, we’ll define what nonprofit capacity building may look like for different organizations and offer tips for creating a strong capacity building strategy that fits your nonprofit’s needs.Get a demo of our matching gift software to jumpstart your nonprofit capacity building.

What is nonprofit capacity building?

The National Council of Nonprofits defines nonprofit capacity building as “whatever is needed to bring a nonprofit to the next level of operational, programmatic, financial, or organizational maturity, so it may more effectively and efficiently advance its mission into the future.”

This definition is relative to your nonprofit’s unique goals and operations, but the ultimate objective is to realize your operational potential. That way, you can fulfill your mission to the best of your nonprofit’s ability.

To build capacity, your nonprofit may employ a mix of three approaches:

  • Individual. By investing in individual team members, you can ensure your team has the resources and training they need to be successful in their roles. For instance, you may offer a mentoring program to help new employees acclimate to your organization and get advice from their coworkers.
  • Organizational. Tools like office equipment and fundraising software help your organization run more effectively. To secure the resources needed for organizational capacity building, you may turn to corporate partnerships or brainstorm ways to diversify your revenue.
  • Systemic. At the systemic level, you may lobby for policy changes that will help your organization better fulfill its mission or strengthen your nonprofit’s board. Many nonprofits turn to a community of practice for assistance, which is a group bonded by a common goal that provides knowledge about nonprofit causes and helps organizations apply for grants.


When you combine individual, organizational, and systemic nonprofit capacity building, you fortify all areas of your organization and ensure each has the resources necessary to carry out mission-critical work.

Why is nonprofit capacity building important?

Nonprofit capacity building allows your organization to create a healthy infrastructure that supports future growth and longevity. Through capacity building, your nonprofit will receive a variety of benefits, including:The benefits of nonprofit capacity building, as outlined in the text below.

  • Enhanced impact. When you increase your nonprofit’s operational capacity, you can expand your nonprofit’s programs and services. As a result, you can make a greater impact on your community and beneficiaries. For example, an animal shelter’s increased capacity would enable it to offer additional spay and neuter services and rehome even more animals.
  • Improved sustainability. One of the top methods of nonprofit capacity building is diversifying your revenue streams. With funds flowing into your organization from different sources, your nonprofit will be more financially stable and sustainable.
  • Increased efficiency. Investing in tools and training that help team members perform their roles effectively makes day-to-day tasks more efficient. With less time going to logistics, you can spend more time on mission-critical activities.
  • Better adaptability. With funding from different sources and a variety of resources at your disposal, your nonprofit will be better equipped to take on challenges. Whether you’re trying to keep up with trends in your nonprofit’s sector, responding to crises, or adjusting to evolving community needs, your organization can quickly adapt and carry on with its mission.
  • Long-term viability. Ultimately, nonprofit capacity building sets your organization up for long-term success. It ensures you’re taking full advantage of all resources at your disposal to enact lasting change in your community.


Your nonprofit’s focus should be your mission. When you allocate time to capacity building, you strengthen your nonprofit’s operations so all underlying processes are as efficient as possible, allowing your mission to remain at the forefront.

How to Create a Strong Nonprofit Capacity Building Strategy

Like with any strategy, it’s essential to follow a systematic approach to building your nonprofit’s capacity. That way, you can craft a strategy that’s thorough and fits your organization’s unique needs.

To develop your nonprofit capacity building strategy, keep these steps in mind:The steps for creating a strong nonprofit capacity building strategy, as outlined in the text below.

1. Start with your mission.

As mentioned before, your mission is at the heart of your nonprofit’s operations. Think about how all elements of your organization come together to support your mission, and determine any areas you could improve to better achieve your goals.

For example, an organization for at-risk youth may have a mentoring program that has worked well for beneficiaries in the past but is currently understaffed. This nonprofit may look into hiring additional staff members or volunteers to manage the program so it can better fulfill its mission of providing a brighter future for at-risk students.

As your organization grows and changes, so may its priorities. Before diving into the nonprofit capacity building process, take a careful look at your mission to ensure it still reflects your organization’s current services and values. You may eliminate facets of your mission if they’re no longer relevant or make additions if your nonprofit has taken on new initiatives.

For instance, a healthcare organization may have added a focus on stopping the spread of COVID-19 to its mission in 2020 when the pandemic began but might have removed this element in May 2023 when the World Health Organization (WHO) declared an end to the global Public Health Emergency (PHE) caused by the virus.

2. Evaluate your needs and current resources.

Next, assess your organization’s most pressing needs and whether you have the resources to address them. While some needs may be more readily apparent, others may require further investigation.

All staff members, board members, and volunteers have different perspectives on your organization that allow them to identify unmet needs. Send periodic surveys that invite these stakeholders to provide feedback on your nonprofit’s operations. You may also host discussions during team meetings to obtain more candid feedback on your organization’s needs.

Once you’ve compiled a list of your nonprofit’s highest-priority needs, evaluate your current resources’ ability to fulfill them. You may consider the following questions when assessing your needs and resources:

  • Is there a deadline for addressing this need?
  • What are the costs associated with addressing this need?
  • How many team members do we need to address this need?
  • Do we have the appropriate equipment to address this need?

If your nonprofit has some resource gaps to fill, brainstorm how you can efficiently acquire the tools you need at a low cost.

For instance, you may find that your organization is eligible for a grant that would help you cover the costs of obtaining fundraising software. Additionally, if you don’t have enough staff to address a pressing need, you may tap into your corporate partnerships to see if they’re willing to donate their services pro bono or leverage your volunteer network.

3. Get your team involved.

Your team’s involvement in nonprofit capacity building shouldn’t end with them offering their initial input. Lean on the support of staff, board members, and volunteers to implement your capacity building plans.

Your board in particular should have a role in creating your capacity building strategy. As the governing body of your organization, your nonprofit board can decide how to best allocate resources for capacity building and successfully address each need.

If you need additional support in developing your nonprofit capacity building strategy, enlist the help of a nonprofit consultant. An outsider’s perspective may be just what your organization needs to provide an objective opinion about your capacity building priorities.

4. Determine your goals and timeline.

Clear goals and metrics will break your needs down into manageable goals and help you evaluate your progress. Stick to the SMART (Specific, Measurable, Achievable, Relevant, and Time-Bound) goal framework to ensure your goals are actionable.

Let’s say that your nonprofit is looking to develop a new onboarding process that better informs team members of their responsibilities, company culture, and your mission. Take a look at how your team may qualify and quantify this objective using the SMART goal framework:The SMART goal framework for creating useful nonprofit capacity building goals, as outlined in the text below.

  • Specific. Our human resources team will create and implement new onboarding materials that give a more holistic, comprehensive view of each team member’s role, the organization’s culture, and the underlying nonprofit mission and services.
  • Measurable. Our goal is to increase new team member efficiency by 20% by providing them with the resources they need to succeed from the start.
  • Achievable. In the past, we’ve made slight improvements to our onboarding process and have seen small gains in new team member efficiency. We’re hoping that a larger-scale revamp of the new hire onboarding process will allow us to see even greater results in employee motivation and productivity.
  • Relevant. When team members have a better understanding of their roles and how they contribute to the organization’s purpose, they’ll work more efficiently and effectively. Consequently, we’ll spend less team member time on logistical tasks and more on urgent, mission-critical work.
  • Time-Bound. Our human resources team will develop this new program over the course of the next quarter. Then, we’ll roll it out to the next batch of new hires and measure their subsequent performance.

Applying the SMART goal framework to your nonprofit’s needs can also help you determine which ones to address first. You may be able to address multiple needs at once or have to prioritize certain needs over others in order to commit your full attention and resources to each one.

5. Invest in the right tools.

Once you’ve further defined your goals, you may notice you’re missing some of the tools or software you need to succeed. For instance, if you’re launching a campaign to promote a new service your nonprofit is offering, you may need to invest in new marketing software that will automate your outreach.

Although it’s best to take full advantage of the resources you currently have, an investment in the right tools is an investment in your nonprofit’s future. To increase your nonprofit’s capacity, it may be worth it to purchase new software or obtain additional resources that will make your nonprofit’s operations more efficient.

6. Track your progress.

Before you embark on your nonprofit capacity building efforts, set up benchmarks that allow you to mark your progress. You may schedule monthly check-ins with the appropriate team, take notes on the state of each project, or survey those involved with each endeavor to see where you can improve your efforts.

For all goals with clear performance metrics, make sure to check your campaign data regularly to ensure you’re on track. For example, if you’re running a capital campaign and intend to raise $10,000 overall, download reports from your fundraising software each month that indicate how much money you’ve raised in the past month and how much you’ve raised throughout the campaign.

5 Ways to Enhance Your Nonprofit’s Capacity

Now that we’ve covered the basics of nonprofit capacity building, it’s time to dive into some specific strategies you can implement to enhance your nonprofit’s capacity. While your organization’s specific plan will depend on your goals and resources, here are some ways nonprofits in a variety of sectors can expand their operations and increase efficiency:Ways to build your nonprofit's capacity, as outlined in the text below.

1. Invest in matching gift software.

Our top recommendation is to invest in matching gift software. Companies that offer matching gift programs match their employees’ donations to eligible nonprofits. While most companies match employee contributions at a 1:1 ratio, some match at a 2:1 or even 3:1 ratio.

However, 78% of donors are unaware if they’re eligible for matching gift opportunities. As a result, they don’t fill out matching gift requests, and nonprofits collectively miss out on $4-$7 billion in matching gift funds each year.

Matching gift software resolves this matching gift gap by automatically informing donors of their matching gift eligibility and prompting them to fill out a matching gift request form. Nonprofits can embed this type of tool right on their donation pages so that donors can submit their requests immediately after contributing. Check out the video below to learn more about how our matching gift software, 360MatchPro, helps nonprofits earn more:

As the video explains, 360MatchPro users raise 35% more in matching gifts each year. This passive income allows charitable organizations to expand their programming and ultimately help more beneficiaries.

To make the matching gift process more efficient and help your nonprofit earn even more, some matching gift platforms offer auto-submission. Instead of donors filling out a matching gift request form, all they have to do is input their company email address and check a box indicating they’d like to opt into auto-submission. Then, the platform creates and sends the request to the donor’s employer on the donor’s behalf, driving even more matches to completion.Click through to get a demo of our matching gift software and build your nonprofit's capacity.

2. Provide professional development opportunities.

When you invest in each individual staff member at your nonprofit, you fortify the team as a whole. Professional development opportunities allow team members to hone their skills and build confidence.

The types of opportunities you may offer include:

To ensure team members are motivated to participate in professional development opportunities, survey them to see which they’d be most interested in. Then, implement the most popular methods to begin growing your staff’s skills while measuring the opportunities’ engagement and impact.

3. Diversify revenue streams.

Imagine your nonprofit’s only source of revenue is from individual donations. You have a large donor base with many generous recurring donors. However, the economy starts to decline, and you notice donation revenue is decreasing as a result. Suddenly, you begin to worry that you won’t have enough funds to cover all of your programming and have to start cutting important services that your beneficiaries depend on.

Building your nonprofit’s capacity should make your organization more sustainable. However, if you rely on one main revenue source, you put your nonprofit at risk.

Tapping into a variety of revenue streams allows your nonprofit’s finances to remain steady, even if one source dries up. We recommend leveraging a combination of the following revenue streams:Different revenue streams for building your nonprofit's capacity, as outlined in the text below.

  • Individual donations. These may include one-time donations, recurring donations, planned gifts, major gifts, and in-kind donations.
  • Corporate philanthropy. Charitably-minded companies contribute to nonprofits through matching gifts, volunteer grants, community grants, event sponsorships, automatic payroll deductions, annual giving campaigns, and more.
  • Earned income. Your organization can earn funds by selling merchandise, charging membership dues, and selling event tickets.
  • Investments. Sometimes, nonprofits receive major gifts in the form of endowments that they can deposit into an investment account. Your organization can also open and invest in a brokerage account, just like individuals can.
  • Grants. There are all sorts of different grants out there that government entities, corporations, and foundations provide to nonprofits. You can even apply for specific nonprofit capacity building grants.

Once you’ve properly diversified your nonprofit’s revenue streams, keep track of how much you’re earning from each method for internal and tax filing purposes. If you need help reporting your nonprofit’s revenue, partner with a nonprofit accountant.

4. Rework your strategic plan.

Your nonprofit’s strategic plan serves as your roadmap for success. It aligns your organization’s goals with its values to provide a strong foundation for decision-making.

Since your strategic plan helps you prioritize projects and navigate challenges, it’s a good idea to revisit it when trying to build your nonprofit’s capacity. You may find that your organization’s initial strategic plan is not comprehensive enough to cover all of your current operations or that the goals outlined in your plan no longer reflect your nonprofit’s current priorities.

When you update your strategic plan, you can get all your team members on the same plan and provide more direction to your nonprofit capacity building efforts.

5. Network with other industry professionals.

From time to time, you may feel stuck with how to properly build your nonprofit’s capacity. Luckily, there are many nonprofit professionals out there who have gone through the process and can provide advice on how to improve your organization’s operations.

Networking is essential to gaining insider industry knowledge and building inter-organizational relationships. Start networking with other nonprofit professionals by:

By connecting with others in your industry, you can help each other navigate challenges and learn from each other’s experiences. Along the way, you’ll acquire tips that will help you build your nonprofit’s capacity and operate more efficiently.

Wrapping Up

Nonprofit capacity building is an ongoing process. As your organization grows and changes, new ways to scale your operations or function more efficiently will emerge. It’s up to your team to build a strong foundation for building capacity by evaluating your organization’s values, goals, and resources. Then, develop a strategy based on your nonprofit’s current needs and work with staff, board members, and volunteers to implement it.

Want to dive deeper into some of the nonprofit capacity building strategies we’ve covered? Check out the following resources:

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Nonprofit Board Orientation: How to Get New Members On Track

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Imagine this: you’ve been a passionate advocate and donor for a nonprofit’s cause for many years. When the organization reaches out with an invitation to join its board, you’re ecstatic about the opportunity and eagerly accept.

However, when you show up to your first board meeting, you quickly realize that your role as a nonprofit supporter has not adequately familiarized you with the ins and outs of the organization. Suddenly, your excitement for this new opportunity turns to nervousness and frustration. You don’t feel prepared enough to contribute during the meeting and instead wonder how and when you’ll be brought up to speed about the board and the nonprofit’s general operations.

As a nonprofit board chair or president, it’s your job to avoid scenarios like these and ensure your board operates effectively. By holding a proper nonprofit board orientation, you create a smooth transition for new board members and simplify board management.

In this guide, we’ll cover the following nonprofit board orientation topics:

Throughout the article, we’ll answer all of your nonprofit board orientation questions and offer tips to ensure it’s a positive experience for all parties involved, including new board members, existing board members, and board leadership.Introduce new board members to matching gifts during your nonprofit board orientation with our ultimate guide.

What is nonprofit board orientation?

Nonprofit board orientation is the process of informing new board members about your board’s structure and policies, as well as your organization’s mission and overarching goals.

While nonprofit board orientations are typically in-person, single-session meetings, nonprofits have adapted their board orientation formats in recent years. You may choose to host your orientation in multiple in-person sessions or through live virtual, asynchronous virtual, or hybrid sessions.

No matter which format you implement, your nonprofit board orientation should review the following information:Nonprofit board orientation checklist of what organizations should cover, as outlined in the text below.

  • Your nonprofit’s mission, history, and values
  • Your nonprofit’s strategic goals
  • Your nonprofit’s budget
  • Your board’s structure
  • Your board’s bylaws and key policies
  • The roles and responsibilities of board members
  • The frequency and format of board meetings

At the end of orientation, new board members should feel prepared to attend their first meeting, equipped with the knowledge they need to succeed in their new role. Even if your orientation materials are extremely thorough, be sure to leave time for questions to clear up any confusion and ensure new board members fully understand their responsibilities.

Who should participate in a nonprofit board orientation?

New board members are the main audience of your nonprofit board orientation. However, you should incorporate other team members into your orientation to provide a holistic experience for new members.

Here are the main groups that should participate in your orientation, as well as their roles:The people who should participate in your nonprofit board orientation, as discussed in the text below.

  • New board members. New board members should attend your nonprofit board orientation ready and eager to learn about your organization. They should review all relevant materials, take notes, and ask any questions they may have about your organization or board.
  • Current board members. Your orientation is a great chance for new and current board members to get to know each other. Current board members may also help lead presentations during orientation and act as mentors for the new members. Additionally, they may benefit from going through the orientation process again to reinforce their background knowledge of your nonprofit.
  • Board chair or president. The board chair or president should attend to welcome new board members and manage the orientation experience. They may lead sessions and provide information about board members’ roles and responsibilities.
  • Executive director or CEO. Since the executive director or CEO is the most knowledgeable about your nonprofit’s mission, history, and goals, they should present this information to the new board members. They may also help organize the logistics of your nonprofit board orientation.

If your nonprofit is interested in hiring a third party to lead your board orientation, you may also have facilitators lead certain sessions. External facilitators specialize in encouraging participation and fostering valuable discussions. They also bring a neutral perspective to your nonprofit board orientation.

Why is holding a nonprofit board orientation important?

On the surface, it may seem that a nonprofit board orientation’s only purpose is to acquaint new board members with your organization and board. While that is one benefit of holding an orientation, there are several other advantages your organization will receive.

Holding a nonprofit board orientation is important for any charitable organization welcoming new board members because it:The benefits of holding a nonprofit board orientation, as outlined in the text below.

    • Introduces new board members to your organization’s goals. Let’s say your organization has traditionally given new board members a welcome packet instead of a full orientation. While this packet likely covers a lot of the information board members need to succeed, it may not get to the heart of why board members’ roles are so important and what they’re striving to help the organization achieve. With a nonprofit board orientation, you can take the time to cover your nonprofit’s strategic plan and goals so board members have more context for their decisions.
    • Clarifies expectations for each board member. A welcome packet alone may lay out the responsibilities of each board member. However, when you interact with new board members in an orientation setting, you can more clearly set your expectations for them and answer any lingering questions.
    • Increases accountability. With a clear understanding of their responsibilities, new board members will be more likely to take accountability for their actions and fulfill their commitment to your organization.
    • Encourages team building. During in-person nonprofit board orientations or synchronous virtual sessions, new board members can get to know existing board members and organizational leadership. As a result, they can start to build working relationships that will enhance their collaboration and teamwork down the line.
    • Leads to more efficient decision-making. When each new board member enters their first board meeting with a thorough understanding of your nonprofit, they can make well-informed judgments, speeding up the decision-making process.
    • Improves board effectiveness. Overall, nonprofit board orientations make boards run more smoothly. New board members who are well-prepared through orientation are more willing to engage in board discussions, make strategic decisions, and act in the best interest of your organization.

While holding a nonprofit board orientation takes up more team member time and resources than a welcome packet, it’s well worth the investment to have fully informed board members who are ready to take on important decisions on your organization’s behalf.

How to Prepare for Your Nonprofit Board Orientation

Like any type of meeting, nonprofit board orientations require extensive preparation to ensure they’re effective. Your goal should be to develop an engaging and informative experience for new members that begins the moment they accept your invitation to join the board.

To prepare both new members and facilitators for your orientation, treat the following as your board orientation checklist:The steps to prepare for a nonprofit board orientation, as outlined in the text below.

1. Announce your new board members.

Kick-off orientation preparation by announcing your new board members to your organization. That way, staff and existing board members can familiarize themselves with the new individuals. Additionally, creating an official announcement will help new board members feel valued by your organization and start your relationships with them on the right foot.

While you may first send an internal announcement via email, inform the public about your new board members through social media and your website to keep external stakeholders in the loop.

2. Host a welcome event for new board members.

Shortly after you officially announce the arrival of your new board members, host an event to welcome them to the team. This meet-up will demonstrate your appreciation for your new board members’ commitment to your nonprofit.

A welcome event is also a chance for new board members to mingle with each other and current board members, allowing them to start forming working relationships that will strengthen your board.

3. Add new board members to necessary communications.

Make sure new board members start receiving necessary organizational communications by adding them to your email lists. For instance, you may have a general email list for your entire nonprofit, as well as a board-specific email list that informs members of upcoming meeting dates and offers previews of each meeting’s agenda.

4. Schedule a tour of your facility.

Becoming comfortable with your facility will help new board members determine the logistics of where to meet and how best to get there before their first meeting. While you should introduce them to the boardroom, show them other parts of your facility as well to help them get a better sense of your organization’s activities and what different staff members and volunteers do each day.

5. Create a new member welcome packet.

As mentioned before, a new member welcome packet should not be the end-all-be-all of your nonprofit board orientation. However, it can serve as a jumping-off point to help summarize key information for new board members.

If possible, distribute your new member welcome packets before your first orientation session. That way, new board members can review the contents ahead of time and note any questions they’d like to ask during orientation.

6. Delegate orientation responsibilities to different team members.

To ensure your board chair or president isn’t doing all the heavy lifting, distribute the responsibilities of leading your nonprofit board orientation to different team members. You may have current board members and senior staff members volunteer to lead certain sessions or delegate them based on each team member’s area of expertise.

7. Pair up new and current board members.

New board members may be hesitant to speak up in their initial board meetings. To help new board members acclimate to the board, pair them with current board members who can serve as mentors.

These board member mentors can meet with their new member mentees one-on-one to discuss any concerns and answer any questions. New board members may feel more comfortable going to a singular point person for advice than voicing their doubts in front of the entire board. As a result, they’ll get the information they need to feel confident in their abilities and become effective board members.

 

Watch This Panel by NXUnite for More Nonprofit Board Best Practices

Wrapping Up

While it can be stressful to switch up the composition of your board and incorporate new members, holding an effective nonprofit board orientation helps to create a smooth transition for everyone involved. With a dedicated process for acclimating new members, you can quickly familiarize new board members with your organization, helping them step into their new roles and build relationships with other board members. Consequently, you’ll have a more well-informed, effective board governing your organization.

If you’re looking for more tips to help your nonprofit board run efficiently and effectively, check out the resources below:

Teach your new board members about matching gifts during your nonprofit board orientation with the help of our guide.