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How Do I Raise Funds For a Nonprofit?

Buying bonds from a nonprofit organization lets you show your giving side--and make money, too.

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This story appears in the August 2007 issue of Entrepreneur. Subscribe »

Nonprofit cultural institutions are increasingly issuing bonds as an additional revenue-raising vehicle. The number of organizations on Standard & Poor's credit ratings list in this category alone has doubled since 2000 to about 30 organizations.

The Please Touch Museum in Philadelphia issued $60 million in bonds last October to renovate and restore the 130-year-old Memorial Hall. The bonds helped finance the project quickly. "All large-scale projects have a mismatch in when you need to spend the money [and] when you get the money," says Concetta Anne Bencivenga, CFO of the Please Touch Museum. "We need to pay our contractor now. [A bond issuance] made the most economic sense." But do bonds issued by these institutions make financial sense for individual investors?

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