Philanthropedia – helping US donors focus their online giving where it makes the most impact

In response to the growing trend of savvy donors wanting more reassurance that their donations really will make a difference, an interesting new online initiative was launched last month called Philanthropedia.

Philanthropedia is essentially an online charity crowdfunding site – but one with a difference, in that it uses a team of 261 experts specialising in different social causes to evaluate the effectiveness of US non-profits. Their recommendations are then used to define ‘Expert Mutual Funds’ representing those they deem to be the best organisations to support doing work within specific cause areas.

For launch, the experts have defined three Mutual Funds that online donors can support – representing Climate Change, Education, and Bay Area Homelessness – with another eight apparently on the way.

So, if you are particularly interested in Climate Change you can select the Climate Change Mutual Fund and then choose one of the 15 non-profits assigned to that fund, or share your donation across the whole lot:

Funded by the Hewlett Foundation, Philanthropedia doesn’t take any share of donations made to its Funds – so all donations do go to the chosen organisations, net of a 2.9% PayPal credit card processing fee.

Of course, the heart of the whole Philanthropedia proposition is the quality of its selection criteria, and I have no doubt that there will be much debate around this as the site grows – particularly as the evaluation criteria used differ for each of the cause areas chosen.

However, overall it is certainly a novel response to individual donors’ growing desire to make more informed decisions when it comes to their giving. It’ll be interesting to watch the site over the next year to see just how attractive it proves to be to online US donors looking for more understanding as to where they should ‘invest’ their charitable giving.

 

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See The Difference and the game changing potential of Charity Choice Consolidation websites

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There has been a growing level of discussion here in the UK fundraising sector over the last couple of months about the much awaited launch of video-based charity project crowdfunding site See the Difference – added to just this week by a resounding endorsement in an open letter from UK Institute of Fundraising CEO Lindsay Boswell, which you can read on the Institute website.

As I outlined in my post about this exciting initiative back in May, the See the Difference team includes an impressive line-up of corporate backers contributing time and resources to launch a site that will offer videos of funding opportunities from a wide range of different charities, supported by social media sharing technology and the promise of specific video updates when projects are completed.

At first sight, this might just look like a video-based version of any number of existing fundraising websites already available – like GlobalGiving and PifWorld. However, what I find particularly interesting about See the Difference is just how they describe their vision for the site.

On their introductory video, Stuart Hamilton, one of the founding team, shares the vision for See the Difference by explaining “We might start seeing the See the Difference logo in all sorts of unexpected places, the logo appearing in all of the different places around the world where projects are going on. So See the Difference could ultimately become the standard way in which people choose and express the things they care about and the differences that they want to make to the world”.

This is a very exciting ambition for the See the Difference brand – and also very interesting from the point of view of charity fundraisers.

Put simply, if See the Difference grows the way that it hopes to then it could ultimately replace individual charity brands as the owners of relationships with online donors who fund their projects. Why give a regular donation to an established charity for them to use however they see fit, when you can instead choose specific projects that interest you from a wide range of different charities through See the Difference – and receive your updates and future giving opportunities through them too? In effect, See the Difference becomes my ‘Charity Choice Consolidator’ – and, thanks to them, I am free to switch my giving whenever I feel like it to any other organisation represented on their site.

I’m not saying this is necessarily a bad thing – as this type of model fits very much with the way I believe fundraising needs to evolve if we are to capitalise on the opportunities Web 2.0 offers us to provide the choice and engagement that younger online-savvy potential donors are demanding. Indeed, I’d go as far as to say that if we don’t evolve to offer such choice and engagement then we are in real danger of losing-touch not only with young donors but increasingly with those currently at the peak of their earning capability, who are typically less than enamoured with the traditional fundraising approaches used by most charities.

But what fundraisers – and the charities they work for – need to get to grips with is that the idea of charities no longer owning the long-term relationship with those people who fund their work is a real game changer. At the ultimate extreme, if donor relationships become the responsibility of a third party then there is no longer a need for the supporter database and direct marketing teams in every charity across the land to continue to be employed. In this new fundraising future, the key in-house fundraisers skill will be in packaging the work of their charity such that it will sell well on a Charity Choice Consolidator site.

There are, of course, alternatives to a single brand Consolidator-driven fundraising future. For example, SocialActions has taken a different route to providing online supporters with a means of choosing financial and non-financial support opportunities from a wide range of different organisations. They maintain an ever growing open source database of what are termed ‘micro-philanthropic opportunities’ – which can either be directly searched at SocialActions.com or used to ‘push’ opportunities specific to a particular cause or area out to any other website which wishes to publicise them. And, of course, there is still ample opportunity for charities themselves to engage directly with supporters online.

The truth is that for the foreseeable future I expect to see online fundraising evolve to embrace a mix of charity-specific approaches, open source aggregation, and big brand charity choice consolidators – with supporters choosing how to engage based on whether they have a specific link with an existing charity brand or are more interested in a variety of support opportunities.

What is for sure is that fundraisers need to be preparing right now for this evolution – understanding the new opportunities on offer and what implications each of these might have on the way they work, and developing strategies and staff training programmes that will equip them to maximise their online fundraising income in future.

 

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Crowdfunding – a Web 2.0 twist on what community fundraisers have always done?

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There was quite a bit of talk of Crowdfunding in some of the sessions at this week’s IFC Online eConference and that reminded me of an article I was asked to write a while back for Professional Fundraising, the Monthly trade magazine for the sector in the UK, specifically about how online fundraisers might learn from commercial crowdfunding initiatives.

It was a timely reminder, because the article has just been published online as well as in this month’s printed edition.

Update – the article is now ‘subscriber only’ – so I’ve included a full copy here so you can read it:

Crowdfunding: just a Web 2.0 twist on what we’ve always done or the future of online fundraising?

Over the last few years, the development and mass adoption of new web-based services which specifically support collaboration and sharing between users – known as Web 2.0 – has transformed the way in which we can engage with each other, and with brands, online. It has also resulted in the proliferation of a whole new generation of collaboration-related buzzwords, which is great if you like that sort of thing. Personally, as someone who spends a lot of their time working to demystify the complexities of digital marketing to help people do it more effectively, I try not to throw jargon around too much. However, there is one particular Web 2.0 buzzword that I think all fundraisers should know about and understand, because the initiatives that it encompasses offer some very useful learnings for online fundraising.

That buzzword is Crowdfunding. Best defined as The collective attention, trust, and co-operation of a network of people who pool their money together via the internet in order to support efforts initiated by other people or organisations. But best understood through some real world examples…

Interested in football? Think you can do better than the manager of your favourite team but don’t have an oil rich Sheik’s budget available to help prove it? Never fear, your time for touchline glory has arrived thanks to MyFootballClub.co.uk. This is an online community of football fans who, through over 32,000 individual contributions of £35 per year, have purchased their own football team and now make every major decision concerning their club, from team selection to choosing sponsorship deals, through online voting. Admittedly their club isn’t Manchester City. It’s actually Ebbsfleet United from the non-professional Blue Square Premier League. But, they did win the FA Trophy in 2008, just a few months after being purchased by the MyFootballClub crowdfunding community.

Perhaps music is more your thing? In that case you can help take on the big music brands through a range of crowdfunding initiatives like Sellaband.com. There, fans, or “believers” as they are called, contribute in $10 increments to raise the $50k required for their band to record a first album. If successful, they can earn their investment back through subsequent music revenues.

Or, if you prefer movies, you can now become an online mini-mogul through crowdfunding sites like ArtemisEternal.com. Or perhaps you’re a closet fashionista, and would prefer to buy a share in a new designer through crowdfunded fashion initiative catwalkgenius.com?

Hopefully by now you’ll get the picture. The ease of online collaboration brought about by Web 2.0 enables businesses like these to harness the enthusiasm of individuals from all around the world, attracted by the opportunity to cut-out the middleman and get personally involved with other like-minded folk in funding a specific initiative or project.

The crowdfunding business model should also ring a bell amongst fundraisers. As these examples of crowdfunding are essentially online commercial versions of community fundraising, albeit with some interesting extra participant benefits such as involvement in decision-making and a potential financial return on your investment. And, of course, there are a number of nonprofits who are also establishing and fundraising from online donor communities in similar ways.

Of these, probably the most successful and perhaps the closest to the commercial crowdfunding model is the nonprofit microfinance organisation Kiva.org. Its innovative approach of offering donors the opportunity to help finance micro-loans to small business entrepreneurs throughout the developing world, and then to re-use their donation once their loan has been paid back, has proven immensely popular with online donors looking for an alternative to traditional charity asks. From raising $1m in its first year, Kiva hit $10m in year two and an amazing $40m by the end of its third year in October 2008.

Another fairly recent online nonprofit start-up, which follows a more traditional community fundraising model to crowdfund educational projects in the US, is Donorschoose.org. In the 9 years since they launched, over 115,000 donors have used their site to choose and fund projects and last year they raised over $10m.
In addition to such specialist, single cause nonprofit crowdfunding sites, there are also a growing number of what might be called online charity crowdfunding supermarkets where donors can browse and select from projects being undertaken by a wide range of different organisations. One of the best known examples of these is Globalgiving.com which launched in 2001, since when it has raised over $12m and now offers grassroots development projects for funding from over 50 different nonprofits. Other such sites include the recently launched Pifworld.com.

If you take a look at any of these sites, specific or supermarket, you’ll see that they all have certain things in common beyond the fact that they are making pretty good use of the online medium.

Most importantly, they are not just online fundraising portals providing secure donation handling for Credit Card or Direct Debit donations. Rather, they have invested significant effort in successfully migrating the best aspects of traditional community fundraising from the windy church hall to the web.

They don’t make use of the mass direct marketing that has grown to dominate the income sources of most nonprofits over the last couple of decades. Instead they equip existing supporters to recruit more like-minded people from their personal networks of friends, and colleagues. They don’t expect these donors to go out to their contacts with non-specific fundraising asks aiming to add donations to a generic income pot. They identify specific projects, with specific funding needs – and once the needs of a project are met it is no longer available to be funded. They don’t send updates containing information about parts of the organisation or projects of which the donors have no knowledge or interest. They send project-specific updates, in the case of PifWorld in the form of videos from the fieldworkers responsible for using the money you’ve given.

While all of this ‘focused giving’ talk may sound like old hat, it is really very surprising just how few traditional charities are as yet taking advantage of the ways in which you can use the internet to develop such authentic online community fundraising initiatives. Some are beginning to offer project-specific funding opportunities on their main websites, but all too often when you take a close look you realise that what appears to be project-specific is actually still just an example of where your money ‘might’ go. Most charities have yet to evolve their online offering much beyond a web-based version of their usual Credit Card or Direct Debit donation form.

Perhaps it is because they have yet to overcome the internal challenges of designated funding. Or perhaps they’re just so focused on the traditional direct marketing techniques that have driven their past income growth that they haven’t noticed what some of the most successful new online fundraising organisations are doing.

Wherever your online fundraising is at right now, and whatever the reason, I’d recommend you take a close look at those succeeding in commercial and charity crowdfunding to see what you might be able to apply to your own future initiatives. To help focus the mind, you might also want to consider just what competition the growth of this type of activity might represent. If the most enthusiastic of online donors become used to knowing just which projects they are helping fund – will they be less likely to support charities unable to offer such transparency? If a tiny specialist charity can promote its projects through a charity crowdfunding supermarket using all the technical wizardry that was once only available to big charities – then where does this leave the big brands? Might even a share in a crowdfunded movie or football club replace the charity goat or other ‘virtual gift’ as the ‘must have’ low-cost online novelty gift next Christmas?

See The Difference – a very ambitious initiative looking to change the nature of charitable giving

See the Difference

As you’ll see from the promotional video above, the world of online charity crowdfunding ‘supermarkets’ looks set to grow yet again later this year, with the launch of See The Difference.

Founded by former BBC Executive Dominic Vallely, See The Difference plans to engage supporters with a diverse range of projects from all around the world, through a video-based site that uses ‘digital storytelling’ to promote projects and, very importantly, to show donors just what a difference their support has made.

With a very impressive line-up of corporate backers – and endorsements from a diverse group of people from the Head of Individual Marketing at the RSPB to the editor of Heat Magazine – See The Difference is clearly a very ambitious initiative. Not only are they looking to raise £500m (€563m; $756m) over the next five years but they also believe that “See the Difference could ultimately become the standard way in which people choose and express the things they care about and the differences they want to make in the world”.

It all certainly seems very well planned and from what can be seen of the website on the video, the user interface looks pretty slick and engaging.

I wish the team at See The Difference all the very best, as this is just the type of innovative approach that is needed if we are going to see the real potential of online fundraising start to be released. However, £500m seems an incredibly ambitious target to set for their first five years.

The best performing charity crowdfunding site out there at the moment is probably Kiva – and even with its highly innovative ‘investment’ project funding approach and incredible levels of PR support they have just reached £47m (€53m; $71m) over their first three and a half years of operation. While at the other end of the scale, the recently launched video-based project crowdfunding site PifWorld seems from the statistics on its homepage to only have managed to raise £5,250 (€5,915; $7,922) over its first two months.

Here’s hoping that See The Difference can at least get their online giving going at the Kiva-levels – it’ll certainly be very interesting to see just how quickly the income grows once their site goes live. There are no details of a planned launch date on the See The Difference website, but you can contact them through the holding page and keep-up with the site’s development through their recently launched Facebook Page.

Social Actions – open source microphilanthropy in action

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Social Actions is a fantastic online initiative that aims to make it easier for people to make a real difference in the world, by essentially aggregating thousands of online microphilanthropic opportunities from over 50 different non-profits and other sources (at the last count) through one site with powerful search functionality.

However, what is really clever about the way that Social Actions works is that it is not just reliant on people visiting the site to search for opportunities to take actions they might be interested in. It can also ‘push’ action opportunities out to any other website through widgets that will present selected opportunities based on the specific content of the website in question. For example, there is one widget that can plug-in to any WordPress.org blog, identify the keywords of each blog post, and display related opportunities to take action. Now that is really smart thinking.

And that’s not the end of it. They are also harnessing the power of open source development through the provision of an open API that enables anyone to build an application utilising Social Actions’ aggregated data on microphilanthropic opportunities.

As I mentioned in my recent post about the new Kiva open API, the incredible power of this approach is that it offers the potential to massively increase the number of ways that people can engage with the opportunities on offer, and thereby the audience reach achieved, far faster than a single organisation could realistically achieve – by harnessing the creativity and technical abilities of enthusiastic developers right around the world.

To get the open source development ball rolling,  Social Actions launched a ‘Change the web challenge’ during March to get people to come-up with new tools to share the microphilanthropic actions on offer – with $10,000 in prizes up for grabs for the best ideas. The deadline for submissions is today and so far an incredible range of creative applications have been submitted. The top 20 finalists will be announced on April 13th and the winners announced at the NTEN Nonprofit Technology Conference on April 28th.

There are several things that I especially like about the whole Social Actions initiative.

Firstly, the way in which it recognises and specifically works to meet the growing desire for people to be able to personally choose how they get involved with specific causes that interest them – in both financial and non-financial ways.

Secondly, because it goes out of its way to make making a difference easy for everyone. Not only through its aggregation of actions from a host of different sources, clever search functionality, and use of widgets to present specific, context-sensitive opportunities on other sites. But also by emphasising the massive impact that even the smallest action can have, if sufficient people are motivated to take it. Social Actions’ founder, Peter Deitz, defines Microphilanthropy as any small scale activity or gesture, facilitated by technology, that carries with it some intent to do good and has the effect of transforming communities for the better – which is a significant, and potentially very powerful, expansion on traditional thinking around online community fundraising.

Thirdly, the way in which they have so wholeheartedly embraced the whole open source philosophy – engaging the wider online community to help develop the tools with which they will subsequently take microphilanthropy action opportunities to countless more people.

If you haven’t visited their site before – then go and take a look, and have a think about what you might be able to learn from the way in which they are engaging with people online.

The Big Give offers matching grant to encourage online donations for Whitechapel Gallery

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The Big Give is a charity project crowdfunding ‘supermarket’ site established by Alec Reed, founder of the Reed employment agency, apparently (according to an interview in Intelligent Life magazine) following a brainstorm that led to the idea of creating a ‘virtual charity’ using the existing architecture beneath the successful Reed job-seekers site.

Originally launched in October 2007 to encourage high-wealth philanthropy by simplifying the process of matching a corporate or major donor to a specific project of interest, the site is also used by more everyday folks wanting to give the odd £25 or so.

What is interesting from the individual donor point of view is that, as well as the usual project search functionality, The Big Give also offers ‘matched funding’ on certain projects. This works by the Reed Foundation, or others, pledging to match the value of donations for specific projects up to a certain amount. Basically meaning that your donation is worth double to the charity you choose.

The latest matched funding campaign is in support of the Whitechapel Gallery in East London that re-opens this weekend.

Matched funding is an approach that I have seen work very well in traditional direct mail fundraising appeals, but this is the first time that I can recall seeing it on such a charity project ‘supermarket’ site. It would certainly be interesting to know how much more quickly the Big Give projects selected for matched funding achieve their donation targets than the others.

Pifworld raises the user experience bar for charity crowdfunding websites – at least in places

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Just a few weeks behind the originally planned launch date (which is pretty impressive for a development of this complexity) the online fundraising site formerly known as Play it Forward and now renamed Pifworld went live over the weekend.

I’ve been watching the development of Pifworld with interest over the last few months, for a couple of reasons. Partly because it is the latest of a number of innovative online community fundraising developments to recently come from the Netherlands, where the whole concept of online community fundraising has really taken off over the last 18 months or so. But also because pre-launch announcements suggested that Pifworld would offer a very different online user experience to that of established charity project crowdfunding sites like Kiva and Globalgiving – and indeed it does.

At the outset, in addition to the usual project search functionality we’re used to seeing, Pifworld’s project inventory is displayed on an interactive globe (shown above) that you can spin and zoom to see what they have available in any particular area of the world you might be interested in. All within a main screen that also displays latest funding and supporter data. This might sound like an unnecessary novelty, but actually works really well and is a fun and engaging way to see what’s going-on.

Then, when you find a project that looks like it might be of interest, in place of the traditional text and photo-based project funding request, Pifworld projects are promoted through neat little video interviews with key project staff who explain the project aims, activities, and needs – like the woman below explaining her project in India.

Now, other fundraising sites have certainly used video in places to help illustrate project activities. But I’m not aware of any which have taken the next natural step of replacing text and photo project reviews (which are often little more than on-screen versions of good old direct mail leaflets) with a far more authentic and engaging video presentation. Pifworld project updates are also video-based, so you can really see (and hear) what the team have been doing with your donation.

Unfortunately at this stage, once you’ve found the project you’re interested in, the user experience slips a bit – as the online donation process seems a bit more complex than usual. Donations are made from a Pifworld ‘wallet’ which you first have to upload 5 Euro ‘credits’ to. This can be done from vouchers or using most major credit cards (at an added transaction cost of around 1 Euro) but the overall process feels a lot less streamlined than I’ve experienced on other sites. Also the confirmation email doesn’t arrive immediately (I’m still waiting for mine). For all that I love other aspects of the site, I think this payment process could do with another look – given that it’s fundamentally what the whole site is about. It wouldn’t be the first time that an apparently very engaging online fundraising site failed to maximise income simply because insufficient thought had been given to the back-office functionality. Hopefully the Pifworld team will be watching their site analytics to ensure that people are completing their transactions and will fix this if not.

Beyond this, another very nice feature is the way that project advocacy has been built into Pifworld, with people encouraged not only to become Supporters but also Ambassadors for their chosen projects – with blogging facilities provided to help Ambassadors mobilise their personal online networks. There is also email promotional functionality and project details can be shared as an Open Social widget (although only by copying the widget URL and not through a simple pushbutton which is becoming the norm elsewhere).

So all-in-all, a fun and engaging site that will hopefully prove attractive to potential online donors of all ages – with a few wrinkles to iron-out over the coming months. Definitely a site to keep an eye-on.

Meantime, if you’re interested in what else is happening in online community fundraising in the Netherlands, then it’s worth taking a look at 1procentclub.nl and geefsamen.nl (thanks to Victor for those). As well as the latest implementation of the YoCo fundraising platform from my old colleagues at WWAV Holland, which has raised almost 1 million Euros in sponsorship donations for cancer charity KWF Kankerbestrijding’s Alpe d’HuZes cycling challenge just a couple of months after going live.