Starting a nonprofit organization can be exciting. You have a mission to support a specific cause or causes that are near and dear to your heart. You start planning the exciting projects and events that you can execute on to raise money so you can keep doing more…and more…and more…
But as your nonprofit grows, so does the accounting complexity.
While for-profit businesses center their accounting process around showing profits or losses, nonprofits have a unique accounting approach that focuses on accountability. This approach ensures that donors know exactly how their money is being used and auditors can confirm that the nonprofit’s funds are being used appropriately. But it also comes with its unique set of challenges.
To accurately track how all of the funds are being used, nonprofits have the time intensive (and often overwhelming) task of matching each every single transaction to a specific project or initiative. Finding the people and time it takes to do this tedious task can hold nonprofits back from scaling, limiting the amount of good work they can do to improve the world.
This is exactly the problem that Mazlo set out to solve.
When the Mazlo team began exploring a solution to help nonprofits more efficiently track transactions, they quickly realized a core problem was that traditional business bank accounts were not structured in a way that made it easy for nonprofits to perform project-based accounting.
Typically, nonprofit organizations and fiscal sponsors would have dozens (and sometimes even hundreds) of projects all being financially managed through a single bank account. This means that donations coming in and expenses going out of the account would have to be manually associated with the applicable project.
“Rather than trying to build a software platform that integrated with a nonprofit’s banking solution, we had the realization that to truly solve this problem we’d have to become the banking solution ourselves,” said Josh Gaskin, co-founder of Mazlo.
The banking product they built has a unique account structure tailored specifically to how nonprofits manage their finances. Instead of only having a single bank account to manage the finances of all of the different projects, Mazlo’s banking platform allows their customers to generate different subaccounts for each project that can all seamlessly roll up to one primary organization account.
Each of these project-specific subaccounts have their own unique account and routing number so that expenses and donations can be automatically matched to the project they are for.
This innovative structure means that accountants no longer have to use various investigative tactics to track down what project each specific transaction was for. It also gives the leadership team the ability to easily view financial statuses at both the project-level and organizational level.
Then, by integrating additional features into their banking platform, such as simplified vendor management and a detailed dashboard tool, Mazlo can now become the unified financial hub for the entire organization.
So what’s next for Mazlo?
According to co-founder Sean Anderson, “Mazlo’s mission is to empower nonprofits with innovative financial solutions, helping them to amplify their impact and drive progress. We are going to continue to build out a variety of tools specific to nonprofits, so that these organizations can spend more of their time driving positive change and less time on administrative financial headaches.”
Synctera is excited to power Mazlo’s innovative banking product, helping them supercharge financial workflows for nonprofits across the country. By providing Mazlo with an end-to-end solution to launch banking products, including the platform, sponsor bank connection, and risk & compliance expertise, they now have more time to focus on what they do best: build solutions to make nonprofits more efficient.
Visit Mazlo’s site to learn more about their nonprofit banking platform.