Three-quarters of American nonprofits have annual budgets under $1 million, and most are even smaller. What these organizations lack in size, however, they make up for in impact. They respond to local needs, are absolutely critical to community building, and are staffed by people who understand and care about their communities–communities that have been abandoned by countless others.

Yet, we know from our work with small nonprofits (most recently through the Capital and Capacity for Economic Recovery Initiative) that they often struggle with financial challenges that are unique to their size and structure.

Executive directors of small groups often assume leadership through a deep knowledge and understanding of programs and generally have less experience in finance than those of larger ones. On top of that, it can be hard for groups with limited budgets to bring financial expertise…

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