How a Nonprofit Built a Global Software Company (And What You Can Learn From It)

Most people think nonprofits just raise money. Some build empires. Here’s how you can follow their lead.

Author

Phil Peyton
July 16, 2025

💡 Intro:

If you’ve been following along, you know we’re building a nonprofit that owns a business — on purpose.

The goal?
Tax advantages. Legal protection. Smart strategy.

And this week, we’re showing you that this model isn’t just theoretical. It already works — big time.

🏢 Case Study: Tessitura Network

Tessitura is a nonprofit that sells powerful CRM and ticketing software to over 750 performing arts orgs around the world.

  • Built in-house at the Metropolitan Opera

  • Spun off as a 501(c)(3) nonprofit

  • Now serves symphonies, museums, theaters, festivals, and universities

Tessitura was born out of necessity. In the late 1990s, the Metropolitan Opera in New York couldn't find a software platform that met their complex ticketing and customer management needs. So they built their own. But what came next was even smarter: instead of licensing it to private companies or spinning it out as a traditional for-profit tech startup, they turned it into a nonprofit. Why? Because they realized the software could serve a mission-driven purpose: helping arts and culture organizations thrive financially through better operations and deeper donor relationships.

Today, Tessitura earns revenue just like a tech company — through subscriptions and service fees. But because it’s structured as a nonprofit, it reinvests every dollar back into the product, support, and its mission of empowering the cultural sector. There are no shareholders, no equity dilution, and no private owners. Their structure gives them access to nonprofit perks — like eligibility for grants, discounted tools, and legal protections — while still growing like a business. That’s the model we’re building with Nonprofit YOUR Business. Not a charity. A mission-aligned business that earns revenue, serves real customers, and does it all inside a 501(c)(3).

They don’t rely on donations — they sell software as a service.Their clients pay fees. Tessitura earns income.
But it’s all under the nonprofit umbrella.

🧠 Why it works:

✅ Nonprofit owns 100% of the IP
✅ Income supports mission — no owners/shareholders
✅ Still eligible for nonprofit discounts, grants, tax treatment
✅ All revenue stays inside the nonprofit

Sound familiar?
It should. This is exactly what we’re doing — and showing you how to do, too.

🛠 Build-Along Update

📍Where we’re at in our build:
✅ Incorporated in Delaware
✅ EIN secured
✅ 501(c)(3) status pending

This week, you should focus on choosing a domain name and locking it down — even if you never build a site.

Why?
You want control of your brand. And if you do ever create public-facing content or tools under the nonprofit, your .org domain is key.

We filmed a walkthrough of the Delaware Name Search tool, and then registered our domain with Namecheap.

🎥 Watch both videos:

You can follow these steps right now to do the same.

🔥 Coming Up in Issue #6:

→ The real IRS language we used in our 1023-EZ
→ When (and how) we expect to hear back
→ Templates to keep control of your nonprofit HOLDCO — even with a board

🎯 What This All Means for You

This newsletter is for business owners who want to:

  • Reduce taxes legally using the nonprofit structure

  • Protect personal assets and for-profit companies

  • Use education and public benefit as a bridge to build wealth

  • Follow a live build and get practical steps (not theory)

Tessitura did it. We’re doing it. You can too.

📢 Call to Action:

Don’t miss the next drop.
Share this with someone who’s ready to structure smarter.