I recently got some very worthwhile questions from a prospective donor: “Why should I donate online? I hesitate because I know those crowdfunding sites take a percentage of all donations. How much does CrowdRise, Facebook, PayPal and Amazon Smile get from each donation?”
Embarrassingly, I couldn’t answer these questions off the top of my head. I did do my research, however, before signing up on these popular crowdfunding sites – and I found them to be trustworthy, effective in leveraging social media, and the convenience and exposure is worth the price.
Why should I donate online?
Two BIG reasons: the first is that when you donate using a social media platform, your donation not only directly helps us reach our fundraising goal, but your donation also shows publicly so others can see who donated, how much, when and encourages others to show their support with a donation.
The second reason is the transparency required by online fundraising platforms – so you can actually look up the history of any organization you are considering supporting, you can look up their 501c3 status, and their financial records including solicitation licenses, and what percentage of fundraising goes to overhead expenses rather than directly to the campaign.
However, I totally understand the hesitation to give your personal information out online. While The Holistic Homestead never sees your credit card information, our “third party” fundraisers do. If you are concerned about privacy and still want to support this grassroots health and wellness movement, we invite you to mail your tax-deductible donation directly to: The Holistic Homestead, 972 Golden Gate Canyon Rd., Black Hawk, CO 80422. Thanks!
How much does CrowdRise, Facebook, PayPal and Amazon Smile get from each donation?
CrowdRise has the highest rating among crowdfunding platforms for it’s user-friendly set-up, free accounts for non-profits and organizations actually reaching their fundraising goals. The drawback: with the “standard” pricing plan, CrowdRise takes 6% plus 2.9% plus .30 cents from every donation. The 6% is their cut, the 2.9% plus .30 covers the what the credit card companies charge per transaction. The GOOD news: CrowdRise is the only fundraising platform that gives donors the option to “round-up” their donation, so that 100% of what you’d like to donate to the nonprofit goes directly to the nonprofit, and the donor covers the percentages. For example, say you want to donate $100 to The Holistic Homestead’s campaign Opening the Door to Health. At checkout, you will have the option to round up to $109.20 so that 100% of your $100 goes directly to The Holistic Homestead. According to the CrowdRise pricing and fees page, 93% of donors choose the round up option! Another great option offered on CrowdRise is to make your donation anonymously, either to hide your personal information, or the amount you have donated, or both. So far we’ve raised $125 toward our goal of $50,000 on our CrowdRise page.
Facebook charges varying rates on fundraisers, depending on who is fundraising and how the money is distributed. The Holistic Homestead is an approved fundraiser on Facebook and is receiving our payments through Network for Good (who also processes and distributes payments for CrowdRise), so 5.75% is deducted from every donation via our Facebook campaign, Opening the Door to Health, to cover credit card fees and admin costs. As far as exposure, Facebook is THE most popular social media site – and the potential to reach a wider audience with the convenience of donating at the click of the button is a huge advantage for our growing, grassroots nonprofit. We have not found any convincing history on the benefits of paying Facebook to promote our Facebook fundraising campaign, so we do rely on our 800+ followers to like, comment and share (measurable currency in the social media world) to get the word out about our fundraiser! So far, we’ve raised $90 toward our goal of $50,000 on our Facebook campaign.
What is Network for Good? Network for good is the mega-donation hub for almost every online fundraising tool available including Facebook, CrowdRise, GuideStar, Yahoo!, Google, CapitalOne, MySpace, etc. They have strict vetting criteria for their nonprofits including updated financial reporting. The Holistic Homestead currently has a Gold Rating on GuideStar, a nonprofit rating agency that reports and tracks transparency and consolidates financial reporting for the public.
PayPal only takes 2.9% plus .30 for every transaction – regardless of whether you are buying products from our online store (currently set up through PayPal) or making a donation. This is the smallest fee for online fundraising, and your donation goes directly to our account, rather than waiting for a monthly check in the mail from Network for Good. Additionally, many people already have PayPal accounts and do much of their personal business through PayPal, so it’s a familiar platform. Several of our long-term supporters keep a small amount in their PayPal account especially for the special occasion of donating to The Holistic Homestead. Another feature that I especially enjoy is the option to set up recurring payments, say of $5 or $10 every month to the Homestead. This helps us budget for rent and utilities by knowing we have a percentage of those recurring business costs covered.
Do you have a better way to raise money online? What are your favorite nonprofit fundraising strategies? We’d love to hear from you! Leave a comment below, like and share this article! Thanks!
