Posted by: Nathaniel | July 23, 2008

Platforms for giving are different than reasons for giving

Aaron Hurst of the Taproot Foundation wrote a post on their Pro Bono Junkie blog a few weeks ago provactively asking if Causes.com is actually Cost.com.

He had just seen a presentation by Sean Parker, who’s tech startup bedpost includes Napster, Facebook, and now Causes on Facebook. Parker told Hurst and the other audience members that they had founded Causes in order to improve the efficiency of nonprofit fundraising. In their first year, they’ve helped groups raise $3 million. Apparently, Parker tells a story about a random $30,000 grant that one of the orgs using causes received with no solicitation.

Hurst, however, is skeptical. He notes that his organization spent approximately $3000 in intern time to develop their Causes presence, and the result was $30 raised, all from existing donors. Doing some theoretical extrapolation of the implications for other nonprofits, he points out that its not unreasonable to think that Causes actually cost nonprofits $30million last year to raise that three million. Finally, he points out that most Causes members haven’t given anything, and are “free riders” who get the benefit of being seen to associate with a cause without having to spend a time.

While Hurst’s respect for Parker as a businessman is clear, he pulls no punches in suggesting that Causes is probably a net negative for nonprofits that could drive UP the costs of fundraising.

I think there are some important points here, but not necessarily the ones that surface in the post.

1. Platforms for giving are different than reasons for giving I am thrilled, excited, maybe even obsessed by the quality and variety of new platforms for digital giving. I think they allow average individuals an unprecedented opportunity to connect with worthwhile projects around the world. But I think we have to start recognizing that people don’t give just because there’s a mechanism to give. More often than not, they give because others ask them too. Really, online platforms are most useful right now for enabling  organizers to have an easy way to coordinate their communities philanthropy.

2. Most online giving reflects offline communities gone digital Most successful online giving that I’ve seen has been around “campaigns” where users mobilize their offline communities to get online and give. That’s the case with our Global Engagement Summit-GlobalGiving Project Challenge competition. Notable exceptions are: Kiva.org (which is really an interesting exception worth exploring in its own post sometime), and disaster giving (I noticed that GlobalGiving’s total donations skyrocketed with donations to earthquake and monsoon relief for Myanmar and China).

3. Online fundraising has to be part of a larger social media and stakeholder enagagement process to be successful Maybe the most important takeaway is that fundraising is only one way that the internet enables nonprofits to engage with their stakeholders. The internet allows for previously one way conversations (such as the funding process in which the organization asks for money and the donor either gives or doesn’t) to become ongoing conversations. My sense is that the most successful online fundraising will come from organizations with coherent strategies for engaging their supporters ideas and opinions before, during, and after engaging their wallets.

I will update this with some great links to ideas for how to do that last part in a couple hours. Until then I would love to hear others thoughts

[Updated:

4. Platforms that bring together many users have immense latent potential I think the real question with a giving platform like Causes is whether or not there are ways to leverage some of those 12 million users who DON’T already know about your organization. The real potential lies in levereaging the fact that those people are already in a common space to extend your reach. There aren’t a lot of great examples of this out there, but there have got to be ways.

For example, wouldn’t it be cool if Causes had a “buck a month” options where all users were automatically charged $1 per month and could vote on a slate of featured projects – and maybe the grants would be a high enough level that it covered an organizations entire annual budget. The community would collectively distribute an immense $12 million a month, $144 million a year, JUST on shared giving. The 1-10 organizations a month you could fully fund would have be create, engage donors, get their interest, but not necessarily spend lots of money on fundraising. The community of users would begin to feel like an actual community, and the cost wouldn’t prohibit most people still giving to other causes if they so chose.

Anyway, there are obviously problems with this idea, but the fact is, and I think this is what the Causes guys understand, when you have millions of people organized around global change in a shared space, there’s immense potential for doing real good.

Some good resources for more on this:

Socialactions.com – Peter Dietz & Crew are thinking hard about how to create engaged donor communities around “micro-philanthropy” and trying to build platform crossing tools

Change.org – information and action hubs that enables users to read news, see videos, start or join action and fundraising campaigns, and build community around issues of common concern (note: I do some advising work with Change.org)

Social media consultants: Beth Kanter, Britt Bravo, and Heather Mansfield all help nonprofits learn to better leverage social media

Finally, a great presentation from Slideshare’s “World’s Best Presentation” Contest, “What the F**k is Social Media”:

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Responses

  1. “Most online giving reflects offline communities gone digital Most successful online giving that I’ve seen has been around “campaigns” where users mobilize their offline communities to get online and give. That’s the case with our Global Engagement Summit-GlobalGiving Project Challenge competition. Notable exceptions are: Kiva.org (which is really an interesting exception worth exploring in its own post sometime), and disaster giving (I noticed that GlobalGiving’s total donations skyrocketed with donations to earthquake and monsoon relief for Myanmar and China).”

    Totally. Totally. Totally. This is what I tried to get at yesterday, and what I hope to smooth out a bit more today (I already delved in a back and forth with Beth Kanter in our comments section). I really think that where they actually meet, online and offline communities are finally to a point of integration where one influences the other influences the other. For this reason, giving strengthens social capital and social capital strengthens incentive to give. The more I feel like I know you – which for some is built through comments and Tweets and this and that and for others requires a tangible, face-to-face interaction first – the more willing I am to engage in an action. That goes for the organizer, the cause, the people benefited by an action, one of each, or all three combined.

  2. Resonance is key!

  3. […] of participating with purpose, the personality of the organizer, or, in the case of the Internet, the usability of the platform don’t always translate into high levels of participation. Sometimes, if a task asks a little […]

  4. We are in the very early stages of how nonprofits and social activists can leverage social networking applications for good causes and just learning what works and what doesn’t. I think there are a couple of things that need to be happen before we get to best practices and knowing precisely what works.

    Nonprofits need to look at objectives and resources, target their audiences, and think about multi-channel efforts before jumping on the Let’s Use Facebook bandwagon. (I think this applies to all social media – see the Cute Dog Theory for more – http://cutedogtheory.wikispaces.com) Activists need to better understand the psychology of Facebook apps and perhaps revise their campaign strategies. Facebook application developers who want to help change the world and work with nonprofits and activists need to better understand how Facebook culture and behavior meshes with activism and fundraising behaviors and workflow.

    There’s probably a fourth reason too -and that is not leveraging a networked effect. That takes time before it kicks in – maybe takes longer investment than say the immediate gratification of an email campaign.

    Anyway, I’ve written a lot about this here:
    http://beth.typepad.com/beths_blog/2008/07/nptech-summary.html

    And my documented efforts at socially-networked personal fundraising for a nonprofit that helps support Cambodian orphans

    http://gsp4good.wikispaces.com

    Thanks for your thoughtful post.

  5. LOVE the “Buck a Month” idea! Might put off the freefree-riders but if well positioned many could take that superlow hurdle.


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