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  • Writer's pictureTeach The Need

The Economics of Non-Profit Tutoring Organizations

There are an estimated 10 million nonprofit making organizations spread all over the world, serving close to 20 billion people. The society is a mix - up of people, the resourceful and the not so, the rich and the poor. Although when it comes to global love and giving a shoulder for a friend, such factions are disregarded and anyone in a position to help touch lives should step up.

Education dissemination is one entity that has received so much backing in the 21st century. There are millions of people worldwide incapable of funding their academics, most have dropped out of school and are in danger of getting involved in immoral behavior. As a result, people with good hearts, and there are many out there, starting from you reading this – have teamed up to run nonprofit making tutoring organizations to educate, teach, bestow knowledge, train and make useful people out of the less privileged.

But then, most of these organizations run on very tight budgets. They maximize cash flow, while avoiding needless financial risks. Most are start by people without a steady source of income who hold dear goals for the public good.

What is the secret and troubles behind the economics of nonprofit tutoring?

Let’s dive in and see.

The economic objectives of not for profit tutoring institutions:

Not for profit tutoring organizations cannot operate without finances. Although they offer free teaching services, they have to find ways to fund their programs. Everything today takes money, and spending does not exempt nonprofits. Financial objectives of these institutions are:

1. To raise enough money to meet their operations; nonprofit tutors need money to further their programs, to do these they must acquire infrastructure that enables them to meet their aim such as, computers, classrooms, internet, learning materials etc. These things come at a cost. We will see how they manage to raise their funds shortly.

2. Maximize funds and avoid financial risks – nonprofit tutors do not collect fees from their clients, they rely on other methods for funding. This means that they hardly make any profits while they are only into spending, it is important that they spend smartly and precisely within the set budget and save on operating costs.

3. Maximization and care of the available resources

4. Growth of the institution.

Funding of nonprofit tutoring institutions

Since these institutions do not depend on school fees to function, they have other means to get funds for their operations. There are a number of ways these institutions can get funding, these are:


Grants are one of the top sources of revenue for nonprofit tutoring institutions. These are mostly offered by governments to promote and sustain such ideas. It is a show of government interest and support of good work to its citizens. Grants can be allocated from thousands to millions of dollars depending on the need of the institution. In the United States for example, the state offers four types of grants. Competitive grants based on merit. Formula grants based on predetermined awards. Renewal grants and Pass through grants that are issued by the federal agency. Grants support these initiatives and the government develops close relationship with the not for profit institutions to help it whenever there is need.


Donations are voluntarily given by citizens of good will to these institutions. They do not need to all be financial. Different people offer to donate different things to these learners and tutors. From money, classrooms, learning materials, school buses, computers, uniforms, meals and some cash rewards for the tutors. Donors show a kind gesture to these learners and touch their hearts. Most become close members of the institutions and pay the learners and tutors regular visits to check on their progress, give encouraging talks and express their love.


Fundraisers are a common source of funds for these institutions. The school management acquires permission from relevant authorities to conduct a fund raiser towards a certain course. People and guests are invited to an event where the sole aim is to raise finances for the school. Nonprofit tutoring organizations can make lots of money from this method if well planned. It starts by setting a goal and the amount of money required to achieve the goal. Then, the event is planned; another event can also be conducted online to reach those who can’t be accessed physically. Come up with an online platform to moot for the fundraiser and a digital money transfer account. Corporate sponsors are then invited to the event, assess the results of the fundraiser at the close and appreciate those who gave and did not give wholeheartedly.

Crowd funding

Crowd funding is an online mode of raising finances for nonprofit making organizations conducted on the internet. Here, the tutoring organizations use the internet to promote their course and ask for aid from kind souls or those willing to give. They attach a bank account where deposits can be made.


Most nonprofit tutoring organizations have a reputable image. They are in good terms with financial institutions. They can get loans from these institutions and repay slowly with an interest. Although the probability of repayment is low since they are considered no to have financial muscles, the management of the institutions use their names as guarantors with other well-wishers to secure a loan for the institution.

Unrelated business income

Nonprofit tutoring institutions take part in other ventures to make money that is directed towards funding their free programs. This is a profit run program independent from that of the school. The management of such institutions takes part in any legal for profit business. Profits yielded are then directed towards running the institution.


Although the economy of not for profit tutoring organizations like Teach the Need appears to be murky, they still operate and manage their activities. It takes a lot of hard work and kindness to run such an entity. There are many children on the streets and in poor families unable to sign up for basic education. These organizations help with such cases to make sure most children go to school.

With the heat of COVID-19, there has been a decline in the funding of such institutions, most are on their knees due to economic hardships and need support. You can reach out to any of such institutions to donate anything for the good of these students and their tutors who are sacrificing to give them an education. Education is an investment and investing in less fortunate children is a promise for their brighter future and that of the society.


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