16 min read
Nov 28, 2017

How to Choose Nonprofit Software: Everything You Need to Know Before You Buy

Are you uncertain whether you need dedicated software or how to choose nonprofit software that will give you the most bang for your buck? Read our guide!

Deeksha MalikContent Analyst

From managing donations to hosting fundraisers to maintaining a donor database to organizing and tracking volunteers-if you're managing a nonprofit organization, you're always on your toes. On top of all that, nonprofits are typically working with limited resources.

So, how can you keep things from slipping through the cracks?

Lighten your load by leaning on nonprofit software tools, which will automate some of these tasks, allowing you to focus on your organization's mission.

In this article, we'll explain what exactly nonprofit software is, and we'll also help you decide whether implementing dedicated nonprofit software is the right move for you.

Then, we'll examine some key features to look for when purchasing nonprofit software, and finally, we'll take an in-depth look at some popular solutions that offer those functions.

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What is nonprofit software?

Nonprofit software aims to automate and streamline the day-to-day tasks associated with running a nonprofit organization. Some of the tasks it can help you with include:

  • Managing and reporting donations

  • Fundraising event planning

  • Membership management and renewals

  • Donor engagement

  • Volunteer tracking

  • Marketing and outreach

In addition, software can make it possible for you to accept online donations through multiple channels, send automated tax receipts via email, and create branded donation and membership forms.

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Most sought after functionality of nonprofit software

According to a study by Software Advice, 41 percent nonprofits in 2015 across the U.S. were increasingly looking to implement nonprofit-specific software to help with fundraising tasks, membership management, and general operations help.

Seventy-two percent of those buyers were looking for constituent/donor tracking tools, while 39 percent sought outreach/communication tools.

The chart below highlights other functionalities which nonprofits were looking for in nonprofit software:

Source: Software Advice

This trend continues to grow, as the global nonprofit applications market will reach $3.8 billion by 2020. These studies, as well as others, demonstrate that the nonprofit software market is growing as more and more organizations recognize the competitive advantage of using automation to improve business processes and enhance efficiency.

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Benefits of using nonprofit software

As we saw above, software provides a variety of features and functions that address many different facets of organizational operations. Consider the following challenges, and the ways that software addresses them:

  • Are fundraising management tasks preventing you from keeping up with the day-to-day operations that will help you fulfill your mission? The right software can help you manage your donations more efficiently. Donation management features automate the online donation and registration process, making it easier for donors to give and for organizations to receive donations, as well as eliminating duplicate entries to your donor database.

  • Are you and your staff overwhelmed with the administrative tasks involved with managing existing members and onboarding new ones? With nonprofit software, you can manage administrative tasks such as maintaining a donor database, sending out donation acknowledgements and tax receipts, and entering and renewing memberships, with less time and effort. From allowing you to create customized forms for online registration to accepting donations online and automatically managing your membership database, nonprofit software can automate repetitive administrative tasks and eliminate manual data entry.

  • Are you unsure where to start when it comes to building your online and social media presence to reach a wider audience? Software can help you expand the reach and appeal of your nonprofit to new audiences by helping you create personalized web pages and knowledge bases. It can also integrate with your social media accounts, including Twitter, Facebook, etc., and some platforms provide tools to help you design professional membership and donation forms.

  • Do your volunteers find it hard to collaborate? Do you have a proper mechanism in place to share information with volunteers? With nonprofit software, you can remove operational inefficiencies created by information silos, as it allows you to store data and assets centrally and share resources with volunteers, so everyone can be on the same page. You can also create groups for projects or tasks, assign and manage tasks, create calendars, and create and host video conferences.

  • Do you have a financial reporting solution in place to help you produce accurate financial reports related to donations, funds, members, etc.? Transparency of financial reporting is a basic requirement for all nonprofits.A financial reporting tool can help you create transparent and accurate funding reports, keep a record of all donations, forecast budgets, and a lot more.

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What you need to know before you buy

There are plenty of options when it comes to choosing software for your nonprofit organization, and it can become overwhelming. Here are some key considerations you need to take into account when looking for the right product.

Cloud-based versus on-premise software. Cloud-based software solutions are hosted on the vendor's servers which you can access via a web browser through a subscription. For on-premise software, you make a one time purchase of a software license, and it is installed locally on your own systems and servers.

When your data and applications are stored in the cloud, you can access them from anywhere, using a desktop, laptop, tablet or mobile device, as long as you have internet access. Moreover, a cloud-based model is less expensive to set up than an on-premise solution in terms of IT spending, software upgrades, software license fees, etc.

How nonprofit software is priced. Nonprofit software vendors offer different pricing structures, depending on whether the software is hosted on-premise or in the cloud.

On-premise software requires purchasing a license for a one-time fee per number of users, and you own the license forever.

Cloud-based software is typically subscription-based, and you pay a monthly fee, usually per user login. These software solutions have lower upfront cost, and vendors that offer subscriptions typically offer a free trial.

There is also what's called a "freemium" pricing model, which means a limited version of the software is available for free, with the option to upgrade to a paid account for full functionality.

Which strategic integrations you need. Many nonprofit software solutions integrate with other key business applications such as accounting, financial reporting, collaboration tools, marketing automation, online payment processing, and social media management software. Integrations make it possible to leverage your existing tools and data to maximize your nonprofit software.

For example, NeonCRM's QuickBooks integration allows users to map donation campaigns and other types of transactions to their organization's QuickBooks account. Similarly, Aplos Accounting's integration with donor management software Bloomerang allows a seamless flow of real-time data so users can track donors and financial information.

Availability of mobile capabilities, including native apps. Mobile apps can help you and your team use the functionalities of the software even when you're away from your desktop. For example, Wild Apricot's mobile apps for Android and iOS allow users to view and manage their membership database and track event registrations using their smartphones.

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Notable nonprofit software features

Some nonprofit tools may specialize in one or a few of the features below, while others will offer an overview of all or most of them.

Features Description
Accounting management Create fund accounts to track money designated for specific purposes, such as campaigns, grants, and building funds. Nonprofits can also do budgeting for a specific duration based on criteria such as total income and expenses or a per-fund basis and then compare the budgets to actual financial result for the year.
Financial management and reporting Generate standard and custom reports to track specific project and campaign income and expenses.
Registration management Offer online registration for membership to the organization or for a specific event or campaign. Members can also make online payments for registration and other purposes and download receipts for tax purposes.
Fundraising campaign planning Create, plan, and execute fundraising campaigns. Assign tasks, set up goals, and monitor the progress and success of the campaign.
Calendar management Enables users to view all events, meetings, deadlines, milestones, and other important dates spanning across all projects in one location.
Electronic payment processing Accepts online payments related to donations, membership fees, etc. through credit or debit cards or other payment gateways.
Social media integration Connect to your social media management and marketing software to expand the reach of nonprofits on social media platforms such as Facebook, Twitter, LinkedIn, etc.
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Examples of nonprofit software platforms

To help you out, we've put together a list of five popular nonprofit software options to help you narrow down your search.

We've picked these tools after considering various factors such as pricing, user reviews, features, and mobile capabilities. In addition, we've chosen a variety of nonprofit tools that may specialize in a specific functionality to give an overview of the market (for example, membership management, CRM, or accounting).

Wild Apricot: Membership management

Wild Apricot is all-in-one membership management software, suitable for nonprofits, clubs, and other associations.

Some of its key features include:

  • Membership database management. View a member's status, past event registrations, donations made, and more. Members have their own logins, so they can access their payment histories and update their contact information. Users can collect payments online through a website.

  • Online event registration. Design online registration forms that will capture contact information and automatically update the member database when a new member registers for an event.

  • Website builder. The drag-and-drop website builder lets users design a unique website, which also lets you add forums, blogs, and member-only access areas.

  • Mobile capability. Mobile apps for Android and iOS allow users to view and manage a membership database and track event registrations from a mobile device.

Membership management in Wild Apricot (Source: GetApp)

NeonCRM: CRM with fundraising and membership management

NeonCRM is a cloud-based customer relationship management (CRM) tool designed to help nonprofits with fundraising, membership, and event and website management, among other tasks.

Some of its key features include:

  • Fundraising and donor management. Manage fundraising campaigns,engage donors, accept online donations, and generate receipts.

  • Membership management. Store and manage member information in a centralized location. Allows users to categorize members for targeted marketing campaigns.

  • Event management. Assists with event planning, management, and registration.

  • Mobile capability. Mobile apps for Android and iOS allow users to engage with donors and accept donations on the go.

Event registration form view on NeonCRM (Source: GetApp)

Aplos Accounting: Accounting for nonprofits

Aplos Accounting is cloud-based accounting software that's popular among nonprofits and churches. Some of its features include fund accounting, budgeting, bill tracking and payment, invoicing, and financial reporting.

Key features for nonprofits include:

  • Fund accounting. Create unlimited accounts to track separate funds including grants, campaign money, and building funds. Users can also create budget for a specific duration based on criteria such as total income and expenses on a per-fund basis.

  • Donor/donation management. Accept online and offline donations, maintain donation and donor records, and identify recurring donors. Generate contribution statements for tax-deductible donations in a single report and automatically send thank you emails to donors for their gifts and donations.

  • Preformatted FASB (Financial Accounting Standards Board) standard reports. Includes balance sheets, income statements, and general ledgers. Aplos users can create custom reports to track specific project and campaign income and expenses with tags.

Donation management view on Aplos Accounting (Source: GetApp)

Zoho Connect: Collaboration and chat

Zoho Connect is a cloud-based collaboration tool that. While it's not specifically a dedicated nonprofit software platform, it can help nonprofits create an internal private network for their team and an external network for other stakeholders.

Key features for nonprofits include:

  • Collaboration. The tool offers real-time chat, voice calling, and video calling with anyone in the network.

  • Feeds and forums. Team members can connect and collaborate from any location and share ideas.

  • Document management. Users can create a document repository to store files in a centralized location for easy and anytime access. Documents such as best practices guides and organizational policies can be easily stored and shared using the tool's built-in knowledge management tools.

  • Mobile capabilities. With Zoho Connect's Android and iOS apps, network members can stay connected through their mobile devices.

Feeds and forums view on Zoho Connect (Source: Zoho Connect)

Silent Auction Pro: Live auction event management

Silent Auction Pro is a cloud-based tool that allows nonprofits to manage auction fundraising events, including absentee bidding, proxy bidding, and mobile bidding, helping charitable organizations raise funds and donations.

Some of its core features include event tracking, bid management, contact management, donation management, multiuser access, social media integration, and reporting.

Other key features include:

  • Contact management. Manage contact lists, including donors and event attendees.

  • Credit card processing. Accept cash donations and sell tickets online with the integrated credit card processing solution.

  • Mobile capability. Accept bids from mobile devices and tablets using AuctionMobile.

Live auction event management view on Silent Auction Pro (Source: GetApp)

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What to do next

Whatever the size of your organization, chances are that you'd benefit from the automation and streamlining of day-to-day tasks that nonprofit software provides.

As you shop around for the right tool, look for a system that offers tiered pricing plans, so it can scale with you as you grow, but you don't end up paying for more features than you need right now.

For more information about nonprofit software, or to explore other software vendors, browse our nonprofit software category page on GetApp

And, check out these articles from Capterra's nonprofit technology blog:

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