10 Most Common Mistakes New Founders Make (and How to Avoid Them)

Starting a nonprofit is one of the most meaningful things you can do — but it’s also full of hidden challenges. As a founder, it’s easy to get overwhelmed or feel like you have to figure everything out alone. The good news? You don’t. I’ve made many of these mistakes myself — and now I’m here to help you avoid them.

Here are the top 10 mistakes new nonprofit founders make — and how you can sidestep them with confidence.

1. Skipping the Planning Stage

Mistake: Rushing to launch without a mission, vision, or clear plan.
Avoid It: Take time to map out your purpose, who you serve, and your long-term goals.

2. Not Writing Bylaws Early

Mistake: Waiting until the 501(c)(3) application to figure out bylaws.
Avoid It: Draft your bylaws from the start — they’re the rulebook for your organization and required for state and IRS filings.

3. Choosing Friends as Board Members (Just Because They’re Friends)

Mistake: Filling your board with close friends who may not be active or invested.
Avoid It: Recruit a diverse, mission-driven board with people who bring skills, connections, and commitment.

4. Thinking They Can’t Fundraise Yet

Mistake: Waiting to raise money until everything is “official.”
Avoid It: You can fundraise legally as soon as you register and disclose properly — even before full 501(c)(3) status (with transparency).

5. Overcomplicating Everything

Mistake: Trying to do what big nonprofits do right away.
Avoid It: Start simple. One program. One goal. One clear story. You can grow over time.

6. Not Understanding Legal & Financial Requirements

Mistake: Thinking a nonprofit doesn’t need to follow business rules.
Avoid It: Know your state’s laws, IRS rules, and annual filings. (And yes — you need a bank account, EIN, and bookkeeping system!)

7. Trying to Do It All Alone

Mistake: Wearing every hat and burning out fast.
Avoid It: Delegate. Ask for help. Build a team of volunteers or mentors — even if it starts with one or two trusted people.

8. Not Telling Their Story Often Enough

Mistake: Hiding behind the scenes instead of sharing the “why.”
Avoid It: Talk about what you're doing, why you care, and the impact you want to create. People support passion — not perfection.

9. Not Tracking Donations & Expenses

Mistake: Accepting donations without recording or reporting properly.
Avoid It: Use a simple spreadsheet, app, or accounting system. Stay organized from day one — it’ll save you legal and financial headaches later.

10. Letting Negativity or Fear Stop Them

Mistake: Giving up because someone told them it would never work.
Avoid It: You will hear “no.” You might get discouraged. But your mission matters — and the right people will say yes when you keep going.

My biggest mistake was feeling defeated when someone would ask me why I am doing this. I heard so many negative comments and drowned in the negative opinions. I started the Cuddles of Hope Foundation in 2018 when I was married, working full time with 2 children and a household to run. No one thought I had the time or patience (some probably thought I wasn’t smart enough). I didn’t give up because I took it one step at a time and focused on what was in front of me. I didn’t listen to anyone but remembered all of the comments to use as motivation and to be able to look back and feel so much better that I didn’t listen… and because I didn’t listen, thousands of children have received a new stuffed animal to help get them through a difficult time.