Sarah Davies

The tragic earthquake in Haiti has brought up the subject of nonprofit overhead. Here’s an example of a tweet on the subject which was posted today:

Another false meme: “100% of Yele proceeds go to THE PEOPLE” – 2005: 61%; 2006: 65%; 2007: 73%

Seems like a logical complaint – if I’m donating to aid in Haiti, I want my money to go to Haitians. The same complaint occurs all across the nonprofit sector. People want their money to go directly to the cause, with no cuts taken for bureaucracy and inefficiency. But, when you talk to folks who have worked at nonprofits, you hear a much different story.

The word for this type of giving is “restricted.” Restricted giving is popular and common, but it’s actually the least helpful type of giving you can do. The fact is that it takes many people to run a nonprofit organization, and what seems like bureaucracy to you is actually salaries, benefits, and the savings accounts which give organizations a buffer so they don’t have to lay people off in hard times. Most nonprofits run incredibly lean – minimal salaries, minimal benefits, few perks – but the people who run nonprofits are the ones making the biggest positive impact on our society and our world.

When you give to an organization, please specify that you prefer that your gift be “unrestricted,” essentially meaning that you trust the people who run that organization to use it in the most effective way possible to serve their mission. Sometimes that means taking money that would otherwise go directly to Haitians, and using it to raise the salary of the call center staffer who is fielding reports of injury and death all day long, or increase his benefits to include counseling services.

Think about it.

This is a video of a panel run by NPower Seattle‘s Peg Giffels for the Kellog Action Lab. It features Zan McColloch-Lussier from the Pride Foundation, Jessica Ross from Treehouse, and me. We mostly cover Twitter and Facebook, but we frequently diverge into other web territories. Please feel free to spread the video around. I won’t sue you.

Some of the resources mentioned on the panel:

Ways to post to multiple sites at once: Ping.fm and Hellotxt.com
Short explanatory videos about technology and social media: Common Craft
Demographic information about social networks: danah boyd
Alternative copyright licensing options: Creative Commons

Here are my notes from the Nonprofit 911 teleconference with Randall Winston, one of the founders of Causes on Facebook.

Here are the notes from Nonprofit 911:
introduction
slides
notes

Here are my notes:
Basics for Nonprofits

Any user can start a cause. Only nonprofits can make an official nonprofit profile. Both are free of charge. To make an official nonprofit profile, go to http://www.causes.com/partners/new. You will need your EIN number. Your profile will be approved within 24-48 hours. Facebook will verify you as a 501(c)3. Your profile page will include your total donations, total number of donors, total number of supporters, and total number of causes. You can also add your own information, such as mission and history.

Once you have a profile, you can access donor information including name, address and amount donated.

Causes should be seen as a specific campaign or initiative, not an organization. The profile represents the organization. One organization can (and should) have many causes. The photo on each cause should relate to the cause. It should not be your organization’s logo.

When a user creates a cause, they browse the database of nonprofit profiles and pick one to be a beneficiary.

There is a 4.75% fee taken from each donation made through causes.

Questions

Q: What if we already made a cause for our organization? How do we change it into a nonprofit profile?
A: First, sign up for a nonprofit profile, then change the cause into a specific campaign. Upload pictures or video that indicate to people that the cause you created has changed to a specific campaign.

Q: What’s the difference between a group and a cause?
A: A cause has a nonprofit profile associated with it. One nonprofit profile can manage a cause for each of it’s chapters, or each of the bills that it’s concerned with. Groups don’t have that hierarchical structure.

Q: How do donations made through causes get to us?
A: Checks are sent out on the 15th of every month.

Q: What’s your business model?
A: We are a separate company from Facebook, but we have the same venture capital funders as Facebook. We want to branch out into new territory and engage youth. We currently make no profit. If we monetize in the future, it will be through advertising. We will never monetize nonprofits, including selling donor information.

Growing Your Cause

One person can only invite 12 people per day. So you need to be diligent about inviting new people every day, and encouraging them to invite more people.

Add links to online blog posts, articles, or video about your organization through the media board. People like to know that your organization is doing ongoing work. Every time you change a link, it goes to your members’ news feeds.

Start debates and discussions on your wall. Encourage your members to engage and talk to each other.

Offer rewards to the people who recruit the most members or raise the most money.

Questions

Q: Do you have examples of organizations that have had a large return on their time investment?
A: Love without Boundaries recently won our causes giving challenge. We awarded $25,000 to the cause who attracted the most donors. You would think that large causes would typically win, but it was actually the small nonprofits who diligently ran campaigns to get people to invite their friends to donate, who won. Love without Boundaries’ cause page was just a personal story about why the founder started the cause. Then she emailed all her friends who weren’t even on Facebook yet, and they invited their friends, and the cause spread virally.

Q: How do you prevent fraud?
A: You can disassociate any cause that you do not want to benefit your organization. But if someone starts a cause for you, but doesn’t quite get your mission right, you should reach out to them and give them more information. UNICEF didn’t want to join Facebook because they were afraid of losing control over campaigns that represented them, but one of their supporters started a cause for them and raised $10,000. Then they saw the power of exponential organic growth.

Q: In what creative ways have people used causes?
A: One organization gave presentations in classrooms at their University, and offered a pizza party to people who learned more about the cause. The League of Education Voters posted videos of themselves being excited about their own cause and what they would do when they reached their goals.

Q: How much do causes raise typically and how many causes does each nonprofit typically have?
A: Randall has seen fewer than 10,000 people raise over $100,000. Some causes choose not to have a beneficiary and only exist to distribute information.

Sarah Bunting of Tomato Nation promised her readers that if they donated at least $40,000 to the blog fundraising challenge at DonorsChoose.org, she would put on a tomato suit:

I don’t mean some wear-a-red-outfit-with-a-green-hat, only-go-outside-to-buy-milk bullshit either. I mean a big old spherical tomato-mascot rig, red tights, foam leaf hat, the whole bit — on the subway. To Rockefeller Center. Where I work, on the same floor as Saturday Night Live, 50 feet away from the president of Bravo. And then out for lunch, where I will pause to perform the post-kiss Angela dance from My So-Called Life in the plaza. And then back to work. And then out for a drink.

And I will film it.

Her courageous self-defacement got not only her $40,000 goal, but a total of $101,280 from 1,099 donors and secured her win in the contest. And we all get to enjoy knowing that DonorsChoose.org got that money out to needy teachers all over America, oh, and we get to watch the video:

I got a letter in the mail this week from Creative Commons. I get lots of fundraising letters from organizations I’ve donated to in the past, and I generally find it annoying. Doctors without Borders is the worst. I donated to them some time in 2004, and every week I get pictures of dying children and pleas for moremoneymoremoneymoremoney. I think they’ve frittered away my entire donation on postage and printing costs to send me all this crap years later!

EFF is better. When I joined EFF, rather than sending me a letter that said thanks for your money, now give us more money, they sent me a letter saying thanks for your money, you’re a good person, here’s a bumper sticker to show that you’re a proud member. (Said bumper sticker is still on the wall of my cube at ACLU)

But Creative Commons was truly remarkable. This is what they sent me:

They asked me to take action four times before they asked me for money. This came with a simple card showing what sorts of stickers and t-shirts I would get for donating different amounts, and that’s it. No full color 16-page expose on starving artists, just a letter and a card. Bravo!