This is a public service announcement to all social entrepreneurs, hackers, and change-makers in the United States.
As a board committee comprised of hackers, we cannot ignore data. For the last two years, we have been pilot-testing a service called fiscal sponsorship and have empowered 4 projects to serve over 10,000 students across 20 cities, and raise over a collective $100,000 in public support funds. Due to the great success of these programs, we are moving to providing fiscal sponsorship full-time and want to help you fund your social impact project.
(Pictured above: Mentor Hallie Lomax leading a python workshop at the Teens Exploring Code hackathon.)
When we first started Hacker Fund, the goal was to bring technology education to K-12 students nationwide but we quickly realized that the amount of time, paperwork, and money it took to start and manage our 501(c)(3) left little time for us to focus on our mission and program developments. After speaking to other nonprofit teams, we learned that the entire process of setting up a tax-compliant public charity normally takes ~ 9 months, 1000+ hours of paperwork, and over $5,000 in startup fees.
It should not be this hard to do good.
At the end of September 2016, we realized that we could have a much broader impact on the world by empowering others to start their own charitable projects than just focussing on our own. For this reason, we decided to offer this service full-time and are now what is called a fiscal sponsor.
Fundamentally, fiscal sponsorship is a contractual, service-oriented relationship entered into by a 501(c)(3) nonprofit organization and a group or individual whose activities will advance the fiscal sponsor’s charitable purpose. By providing the full suite of back-office services — bookkeeping/accounting, tax filing, general liability coverage, human resources, grant management, and donor administration, among other services — fiscal sponsors allow the project managers they work with to focus on their programs. (view source)
Does this mean Hacker Fund will give you money directly?
No — even better.
Akin to teaching someone how to fish instead of giving them the fish, Hacker Fund teaches aspiring social entrepreneurs to fundraise for themselves, providing them with the essential resources that allow them to focus on learning and execution, without the headache of the 501(c)(3) application and the compliance paperwork.
For a small service fee, we administer fiscal sponsorship that provides you with the infrastructure and legal ability to accept grants, donation, and other forms of public support for your charitable technology projects.
If you have a passion project that aims to make a significant impact in your community, we are the vehicle for your desired social change.
(Pictured above: Mentor Skylar Payne teaching high school students about web development at the GunnHacks hackathon.)
Simply put, Hacker Fund is the container through which you can receive tax-deductible donations to support your charitable activities. For the hackers out there, think — heroku for nonprofits.
Now, what types of projects will we support?
We empower hackers to use their powers for social good! We have supported nationwide STEM mentor programs like The Mentor Project, and student hackathon events like Los Altos Hacks, HackGenY and Space Apps Next Gen.
“It was extremely helpful to have Hacker Fund act as our fiscal sponsor since most of the people on the Los Altos Hacks team were first-time hackathon organizers. As we recruited different sponsors, they managed our finances, which took a lot of pressure off our team and allowed us to focus more on quality of the actual event.” — Selynna Sun, Los Altos Hacks Project Leader
Selynna Sun, one of the top leaders of the high school student community, continues to make an impact in her community through our service and was recently featured by Microsoft on their nationwide channel:
Our goal is to enable more social entrepreneurs like Selynna of Los Altos Hacks to use technology to create public benefit.
We support technology-related projects that must (1) match our mission statement, (2) be charitable according to the rules of the IRS, and (3) offer programs in the one of the following service areas:
- Economic Development
- Youth Development
- Arts & Culture
- Civic Engagement
In addition, projects must also provide support to one or more of the following groups:
- People of color
- LGBTQ community
- Low-income communities
Lastly, the project must choose which type of fiscal sponsorship it wants to engage in with Hacker Fund. The two available forms include:
Comprehensive (Model A): This type of fiscal sponsorship is designed for projects who do not have their own existing entity and commit to raising a minimum annual operating budget of $20,000.
Pre-Approved Grant (Model C): This type of fiscal sponsorship is designed for projects who do have their own entity and simply want to raise additional public support funds through the structure and network of Hacker Fund. There is no minimum annual operating budget.
(Pictured above: The Los Altos Hacks Organizing Team and their advisor.)
In the meantime, if you have more questions about how fiscal sponsorship works and whether Model A or C is right for your team, you can find helpful resources provided by the National Network of Fiscal Sponsors or contact a member of our team by emailing us. We’re always here to help!
As always, happy hacking!
The Hacker Fund Team