Abstract
Nonprofits are guided by internal efforts and external mandates to build capacity. However, scholars and grant makers are hampered by varied definitions of the concept, competing but untested models, and the lack of a reliable and valid measure. This research defines nonprofit capacity as the processes, practices, and people that the organization has at its disposal that enable it to produce, perform, or deploy resources to achieve its mission. An inductive‐confirmatory two‐study approach introduces and validates the Nonprofit Capacities Instrument, a 45‐item measure of eight nonprofit capacities derived from existing instruments. The capacities are (1) financial management, (2) adaptive capacity, (3) strategic planning, (4) external communication, (5) board leadership, (6) operational capacity, (7) mission orientation, and (8) staff management. Intriguingly, this research demonstrates that nonprofit capacity is not a singular or second‐order concept, but better described in its plural form, nonprofit capacities.
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