Nonprofit organizations that incorporate some form of revenue generation through commercial means into their operations. Income-generating activities are not conducted as a separate business, but rather are integrated into the organization's other activities.These activities usually realize little revenue relative to the organization’s overall budget and traditional fundraising contributions.

There are two types of income-generating activities, delineated here by purpose:

Cost Recovery (discrete)--a means to recuperate all or a percentage of the costs to deliver a nonprofit service or fund a discrete activity related to the organization's mission. Special events, conference fees, paid training, and fee-for-service are examples. Cost recovery activities are linked to programs; once a program ends, the related cost recovery activities are terminated.

Earned Income (ongoing)--provides a stream of unrestricted revenue to the organization, generated through activities both related and unrelated to the mission. Membership dues, sales of publications and products, and consulting services are examples. Earned income activities are rooted in operations; they may progress into social enterprises when implementation is accompanied by a business plan.

its legal structure, or type of staff involved that determines whether or not a income-generating activity can be considered a social enterprise? Though subtle, and subject to debate, the defining characteristic is that an income-generating activity becomes a social enterprise when it is operated as a business. The following characteristics apply: the activity was established strategically to create social and/or economic value for the organization. It has a long-term vision and is managed as a going concern. Growth and revenue targets are set for the activity in a business or operational plan. Qualified staff with business or industry experience manage the activity or provide oversight, as opposed to nonprofit program staff.

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