My company, NewWest.Net, is a mission-driven business, and people sometimes ask me if we're a nonprofit. My stock answer: not on purpose!

But we do operate in a sector—online community news—where the nonprofit "model" is gaining ground. And I did consider at the start whether NewWest.Net should in fact be a nonprofit.

We're at a point in our national political conversation where a lot of people are questioning when and whether profit is the right incentive for certain kinds of activities. Most importantly, in the health care reform debate, there's a strong argument being made that the basic structural problem is for-profit medical groups that are in it for the money rather than for patient care.

I don't want to get into an ethics debate about whether it's OK to make money on certain kinds of activities. But the question of what types of organizations should be nonprofit, and why, is an important one for entrepreneurs to consider. A lot of nonprofits these days are not "charities" in the traditional sense but rather a type of small business, and even if you're not a nonprofit yourself, you might find that you're competing with one.

Nonprofits have some big advantages over their for-profit brethren. The obvious one is that they don't pay taxes, but I don't think that's ultimately the most important one. Rather, they benefit from the moral high ground and are able to strike different kinds of business relationships as a result.

Many large companies, for example, will extend discounts, or special sponsorship opportunities, or other benefits to nonprofits, taking those dollars from community relations or charitable activities budgets rather than from the marketing budget.