Nonprofit fundraising is how mission-driven organizations turn public support into the resources they need to operate, grow, and stay resilient. As of April 2026, there are over 1.9 million nonprofit organizations in the US alone, and for these businesses, fundraising shapes everything from day-to-day operations to long-term strategy. It influences how nonprofits raise money, manage donations and grants, and stay compliant with state and federal rules.

Below, we’ll outline the methods and mechanics that matter for nonprofit organizations building sustainable funding models.

What’s in this article?

• What is nonprofit fundraising?
  
• Why is fundraising important for nonprofit organizations?
  
• What are effective nonprofit fundraising methods?
  
• How do donations work in nonprofit fundraising?
  
• How does online fundraising help nonprofits raise more money?
  
• How do grants work for nonprofits?
  
• How Stripe Connect can help
  

What is nonprofit fundraising?

Nonprofit fundraising is the practice of securing voluntary support to finance an organization’s mission. That support often comes in the form of money, but it can also include donated goods, services, or other resources that help reduce operating costs.

Why is fundraising important for nonprofit organizations?

Fundraising is a big part of what makes most nonprofits’ missions possible.

These funds are used to:

• Fund core operations: Donations and grants can pay for the basics (e.g., staff, rent, technology, insurance, compliance) that keep the organization functioning daily.

• Deliver programs and growth: Fundraising can give nonprofits the flexibility to launch new initiatives, expand existing programs, or respond to emerging needs. Organizations that rely on diversified fundraising can grow instead of staying locked into survival mode.

• Reduce financial risk: Ongoing fundraising helps spread risk across donors, campaigns, and funding types, which makes the organization more resilient during economic shifts or funding disruptions.

• Build long-term sustainability: When nonprofits can forecast revenue with confidence, they can invest in people, systems, and programs that improve outcomes over time.

• Expand visibility and engagement: Campaigns, appeals, and events can bring new supporters into the mission and deepen connections with existing ones.

• Reinforce independence: While grants and contracts are important, unrestricted fundraising gives nonprofits control over priorities.

What are effective nonprofit fundraising methods?

Durable programs often rely on a mix of fundraising approaches that balance flexibility, scale, and predictability.

Here are a few methods that nonprofits typically use:

• Individual donations: Contributions from individuals remain the largest source of charitable funding in the US. These gifts range from small, one-time donations to major contributions and recurring monthly support.

• Recurring giving programs: Over time, recurring donors tend to give more in total than one-time donors, and they reduce the constant pressure to acquire new support every campaign cycle.

• Grant funding: Grants from foundations, corporations, and government agencies can fund large initiatives or specific programs. They can come with restrictions, reporting requirements, and fixed timelines.

• Fundraising campaigns: Annual funds, capital campaigns, and short-term appeals work best when the purpose is specific and progress is visible.

• Events: Ticket sales, sponsorships, and on-site donations can raise funds while also bringing new supporters into the organization’s network.

• In-kind contributions: Donated goods, services, or expertise reduce expenses and extend capacity. While they don’t always appear as cash revenue, in-kind gifts can directly support operations and free funds for work that’s necessary to the mission.

• Peer-to-peer (P2P) fundraising: Supporters raise money on behalf of the nonprofit by asking their own networks to give. This method expands reach, lowers acquisition costs, and often introduces the organization to first-time donors who know the fundraiser personally.

• Corporate support: Corporate donations, sponsorships, and workplace giving programs can provide both funding and visibility. These partnerships are often effective when there’s an obvious connection between the company’s values and the nonprofit’s mission.

How do donations work in nonprofit fundraising?

Donors give voluntarily without expecting a direct return. People give because they believe in the organization’s purpose and believe it will use funds responsibly. Donations are often unrestricted, which means the nonprofit can use them where they’re needed.

There are a few ways that nonprofits can encourage donations and improve the experience for donors. Thank you messages, receipts, and follow-up communication help reinforce a relationship. Straightforward donation forms, safe payment processing, and mobile-friendly design can directly influence whether someone makes a gift or abandons the process.

How does online fundraising help nonprofits raise more money?

Online fundraising works because it expands reach beyond geography and allows nonprofits to raise funds continuously instead of in bursts.

Here’s a closer look at some of the benefits:

• It makes giving immediate and always available: Online donation pages allow supporters to give at any time, from anywhere.

• It matches donor preferences: Donors might prefer to give digitally using cards or digital wallets.

• It expands reach: Search, email, and social sharing allow nonprofits to reach supporters far outside their immediate community.

• It supports recurring giving: Recurring online donations create predictable revenue without repeated manual outreach.

• It lowers fundraising costs: Compared to mail campaigns or in-person events, online fundraising reduces printing, postage, and staffing costs.

• It allows for faster response: Nonprofits can launch online appeals immediately when needs arise unexpectedly.

• It generates usable data: Online tools provide insight into donor behavior, campaign performance, and conversion patterns. That data helps nonprofits refine messaging, timing, and donation experiences over time.

• It provides flexible infrastructure: Payment providers such as Stripe allow nonprofits to accept donations reliably while handling security, compliance, and payment issues behind the scenes.

How do grants work for nonprofits?

Grants operate differently from donations. They typically come from private foundations, corporate foundations, or government agencies, rather than individuals, and each funder has its own priorities, eligibility rules, and application cycles. The grant application process is competitive, and nonprofits are often required to submit formal proposals that outline their need, plan, budget, and expected results.

If grants are awarded, they’re for specific uses: the funds must be used for a defined program, project, or outcome. Grant recipients must often track spending carefully and report on progress and outcomes. This often includes financial reports and narrative updates tied to the original proposal. They’re time-bound, too: when a grant ends, the funding ends.

Because grants are often larger than individual donations, they’re better suited for launching new programs, expanding capacity, or funding research and infrastructure.

How Stripe Connect can help

Stripe Connect orchestrates money movement across multiple parties for software platforms and marketplaces. It offers quick onboarding, embedded components, global payouts, and more.

Connect can help you:

• Launch in weeks: Use Stripe-hosted or embedded functionality to go live faster, and avoid the up-front costs and development time usually required for payment facilitation.

• Manage payments at scale: Use tooling and services from Stripe so you don’t have to dedicate extra resources to margin reporting, tax forms, risk, global payment methods, or onboarding compliance.

• Grow globally: Help your users reach more customers worldwide with local payment methods and the ability to easily calculate sales tax, value-added tax (VAT), and goods and services tax (GST).

• Build new lines of revenue: Optimize payment revenue by collecting fees on each transaction. Monetize Stripe’s capabilities by enabling in-person payments, instant payouts, sales tax collection, financing, expense cards, and more on your platform.

Learn more about Stripe Connect, or get started today.