Is Crowdfunding’s New “It Girl” Creating a Generation of Citizen Philanthropists?

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“I went on a shopping spree in July and spent four million dollars on girls and women,” Maz Kessler says proudly.

As the founder and creative director of Catapult, a start-up nonprofit organization that helps development projects for women and girls get funding, she has every reason to boast. Catapult, a crowdfunding site that insists on transparency and engagement with donors, is one of several organizations changing the world of philanthropy. Launched on the first International Day of the Girl, in October 2012, the start-up has already seen impressive results.

Kessler, whose unconventional career trajectory started when she dropped out of the London School of Economics to join a band in New York City, has been a part of the technology sector since the ’90s. Before founding Catapult, she worked as a technology consultant for nonprofits like Women Deliver. Starting her own organization was the next logical step.

Kessler set out to close the gender gap in development funding. In the conference room of Catapult’s Soho office, she rattles off some startling statistics: teen girls receive only two percent of development funding; women (including teens and young girls) receive only six percent. Of the organizations that focus on women’s issues, one in five is in danger of closing.

“Crowdfunding,” Kessler explains, was the “natural solution. From a philanthropy perspective, it was really the only way to go.”

What the Internet makes possible is what Kessler calls the citizen philanthropist. In the pre-Internet days of philanthropy, organizations reached out to donors for funding, but once they received it, donors might never hear from them again. Donors had no idea where their money went or what, if any, good it did. Even in the early years of the Internet, nonprofits had trouble shaking that model: remember the big, yellow donate button of yore? That was an equally passive mode of philanthropy.

When a potential donor finds their way to Catapult’s site, they can browse projects by subject (e.g. advocacy, innovation, orphans) to find something they are truly interested in supporting. They can find out more in the project overview, but perhaps even more importantly, they can review the project budget and know how much money will be used for supplies, or for training, or for administrative costs.

Organizations, once they have been cleared by Catapult’s vetting process, can submit any kind of project they like. They could ask for funding for an office party, Kessler jokes, but they have to convince donors why their office party deserves to be funded. This forces organizations to use their expertise to curate thoughtful, important projects, but leaves it up to the crowd to decide what gets funded.

Once a project is fully funded (organizations have 150 days to reach their funding goal or their project will be closed) organizations must report back to the donors on the status of the project. Organizations can report as often as they like, but at minimum they must send a photo thank you note when the project is funded, an update at 90 days and another at a year (projects should be accomplished by the end of a year).

The required reporting holds organizations accountable for the promises they make, and it keeps donors involved in the project beyond the moment they clicked that donate button. “We’re looking for civic engagement,” explains Kessler, not just “moving resources.”

Trees, Water & People has used Catapult to get funding for several projects, including one that built dry composting latrines in El Salvador. Megan Maiolo-Heath, their marketing manager, said the organization has had a really good experience with Catapult. All of their projects posted to date have been 100 percent funded.

Maiolo-Heath pointed out that she’s used a lot of crowdfunding platforms, but what is truly impressive about Catapult is the company backing them.

Only nine weeks after launching their website, Catapult secured a partnership with the Gucci campaign Chime for Change, which has celebrity representatives like Beyoncé and Salma Hayek. This June Chime for Change sponsored an impressive benefit concert in London to raise awareness and funds for Catapult projects.

It helped. It was only after the concert that Trees, Water & People got their most expensive project funded. With the 10 thousand they raised on Catapult, they distributed solar-powered lights to families in Honduras without access to electricity.

Maiolo-Heath points out that, while the Catapult platform is still evolving, and they continue to work on the user experience, that tech and the crowdfunding model “is making it easier to reach people you otherwise wouldn’t be able to come into contact with.”

“It’s nice to be able to show a donor exactly how we’re spending their money, [to] upload photos and stories from the field,” Maiolo says. “You don’t get that kind of direct involvement without mail.”

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The Charitable-Industrial Complex

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Money should be spent trying out concepts that shatter current structures and systems that have turned much of the world into one vast market.

I HAD spent much of my life writing music for commercials, film and television and knew little about the world of philanthropy as practiced by the very wealthy until what I call the big bang happened in 2006.  That year, my father, Warren Buffett, made good on his commitment to give nearly all of his accumulated wealth back to society. In addition to making several large donations, he added generously to the three foundations that my parents had created years earlier, one for each of their children to run.

Early on in our philanthropic journey, my wife and I became aware of something I started to call Philanthropic Colonialism. I noticed that a donor had the urge to “save the day” in some fashion. People (including me) who had very little knowledge of a particular place would think that they could solve a local problem. Whether it involved farming methods, education practices, job training or business development, over and over I would hear people discuss transplanting what worked in one setting directly into another with little regard for culture, geography or societal norms.

Often the results of our decisions had unintended consequences; distributing condoms to stop the spread of AIDS in a brothel area ended up creating a higher price for unprotected sex.

But now I think something even more damaging is going on.

Because of who my father is, I’ve been able to occupy some seats I never expected to sit in. Inside any important philanthropy meeting, you witness heads of state meeting with investment managers and corporate leaders. All are searching for answers with their right hand to problems that others in the room have created with their left. There are plenty of statistics that tell us that inequality is continually rising. At the same time, according to the Urban Institute, the nonprofit sector has been steadily growing. Between 2001 and 2011, the number of nonprofits increased 25 percent. Their growth rate now exceeds that of both the business and government sectors. It’s a massive business, with approximately $316 billion given away in 2012 in the United States alone and more than 9.4 million employed.

Philanthropy has become the “it” vehicle to level the playing field and has generated a growing number of gatherings, workshops and affinity groups.

As more lives and communities are destroyed by the system that creates vast amounts of wealth for the few, the more heroic it sounds to “give back.” It’s what I would call “conscience laundering” — feeling better about accumulating more than any one person could possibly need to live on by sprinkling a little around as an act of charity.

But this just keeps the existing structure of inequality in place. The rich sleep better at night, while others get just enough to keep the pot from boiling over. Nearly every time someone feels better by doing good, on the other side of the world (or street), someone else is further locked into a system that will not allow the true flourishing of his or her nature or the opportunity to live a joyful and fulfilled life.

And with more business-minded folks getting into the act, business principles are trumpeted as an important element to add to the philanthropic sector. I now hear people ask, “what’s the R.O.I.?” when it comes to alleviating human suffering, as if return on investment were the only measure of success. Microlending and financial literacy (now I’m going to upset people who are wonderful folks and a few dear friends) — what is this really about? People will certainly learn how to integrate into our system of debt and repayment with interest. People will rise above making $2 a day to enter our world of goods and services so they can buy more. But doesn’t all this just feed the beast?

I’m really not calling for an end to capitalism; I’m calling for humanism.

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Is Mark Zuckerberg Creating A New Breed Of Silicon Valley Philanthropists?

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As the tech world creates more and more young millionaires, the question is: How will they give back?

The Facebook founder’s recent donations give some hints, and it’s clear that others are following his model.

It’s a familiar refrain: the latest tech boom has created a growing crop of young millionaires who prefer hoodies to suits and ties. Facebook founder Mark Zuckerburg is the ultimate success story–a Harvard dropout who made billions with a brilliant idea and some coding skills. Whether Facebook is a force of good, evil, or something in between is forever up for debate, but here’s what we do know: Zuckerberg is a really generous guy. And that’s a good thing for the philanthropic organizations waiting to see what the latest generation of wealthy people will do with their money.

Mark Zuckerberg first gained attention for his philanthropic actions in 2010, when he announced on the Oprah Winfrey Show that he was giving $100 million to the beleaguered Newark, New Jersey, public school system. Zuckerberg has no ties to Newark, but as he explained in a blog post, “Newark has unfortunately become a symbol of public education’s failure–of a status quo that accepts schools that don’t succeed.” Zuckerberg added: “Rather than waiting until later in life to focus on giving back, I’ve spent a lot of the last year researching and looking for the most impactful ways to improve education starting in America.”

And indeed, Zuckerberg has continued his quest to improve American education. In December 2012, the entrepreneur announced that he’s giving $500 million in Facebook stock to the Silicon Valley Community Foundation, an organization that gives to local initiatives spanning a variety of sectors (Zuckerberg is focusing on education and health). But here’s the thing. Zuckerberg may be one of the most high-profile young tech philanthropists. He’s hardly the only one, though. And we have to imagine that at least some of the other young Silicon Valley givers are influenced by Zuckerberg’s generosity.

There is no typical Silicon Valley philanthropist, says Daniel Lurie, the CEO and founder of Tipping Point Community, a Bay Area organization that funds local poverty-fighting groups and often works with young donors. “I would say Silicon Valley and the financial industry folks we work with want to know the impact that they’re having. That’s a common theme,” he explains. “They don’t want to just write a check and say ‘We’ll see you next year.’ They want to know where it’s going and what the impact is. They want results.”

In a sense, this mirrors tech entrepreneurs’ professional lives: They want to a see a return on their philanthropic investment. Tipping Point works with a lot of young Silicon Valley professionals, so the organization’s methods reflect these needs. Says Lurie: “We invest our philanthropic dollars in the same way a lot of these entrepreneurs invest in their companies. If something’s not working, they make changes, and if something’s not working at Tipping Point, we’re not scared to make changes either.”


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How Giving Became Cool

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It was 15 years ago that Ted Turner needed something interesting to say in a speech — and decided, in a rush, to give away $1 billion.

“I was on my way to New York to make the speech,” Turner recalled to me. “I just thought, what am I going to say?”

So, in front of a stunned dinner audience, he announced a $1 billion gift to United Nations causes such as fighting global poverty.

In nominal terms, before adjusting for inflation, that semiaccidental donation was, at the time, believed to be the biggest single gift ever made, and it has helped transform philanthropy.

Tycoons used to compete for their place on the Forbes and Fortune lists of wealthiest people. If they did give back, it was often late in life and involved museums or the arts. They spent far more philanthropic dollars on oil paintings of women than on improving the lives of real women.

Turner’s gift helped change that culture, reviving the tradition of great philanthropists like Rockefeller and Carnegie. Turner publicly began needling other billionaires — including Bill Gates and Warren Buffett — to be more generous. That was a breach of etiquette, but it worked.

“It’s a starting point for me of this modern era of high-profile big public giving,” reflected Matthew Bishop, co-author of “Philanthrocapitalism,” a terrific book about how the business world is reshaping philanthropy. “He called on others to step up, which did have a crystallizing effect on others. It allowed journalists and others who were talking to Bill Gates to say: ‘Why aren’t you giving more?’ ” Then they tormented Buffett with the same question.

Ultimately, Gates and Buffett made huge contributions that are transforming the struggle against global disease and poverty. My hunch is that Gates will be remembered less for his work on personal computers than for his accomplishments against malaria, AIDS and poverty itself.

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Ed Norton’s Crowdrise Brings Fundraising (And Fun) To The Masses

The serial philanthropist’s project is helping people raise tons of money for their causes, while keeping the attitude light and funny.

In October, and before an audience of 800 Chicago Ideas Week attendees, Norton announced, “My name is Edward, and I’m a philanthropy addict.” He’s not kidding: The two-time Academy Award nominated actor also serves on the Boards of President Obama’s Committee for the Arts and Humanities; Enterprise Community Partners; Maasai Wilderness Conservation Trust; the Signature Theater Company; the Friends of the High Line; and the Conservation Lands Foundation. And he’s not an in-name-only kind of board member; he really gets in there and works. When he’s not indulging his philanthropy issues, he writes, produces, directs and runs marathons but most recently he’s launched a crazy popular grassroots, peer-to-peer crowdfunding platform, called Crowdrise. It’s a platform to allow anyone to fundraise for a cause, and it does it with a laid-back and funny attitude that undermines the self-seriousness of a lot of philanthropy. It’s also raised a ridiculous amount of money and cultivated a new generation of young activists who manage not to take themselves too seriously in the process.

Crowdrise is based on an idea of “sponsored volunteerism.” Are you finding that activist volunteers are branching out from the marathon/walkathon model of sponsorship to other kinds of volunteerism? What are some other examples?

It’s happening more and more. iMentor, for example, is a New York-based nonprofit that matches students with college-educated mentors through the web. The organization has been successful convincing a large portion of their 2,600 mentors to ask their own friends to support the cause they already donate their time to, resulting in more than $110,000 in small donations raised on CrowdRise. These volunteers are iMentor’s most reliable and convincing ambassadors to the cause.

Crowdrise cracks us up. Why does the Crowdrise brand of irreverence and humor work?

There’s no reason that humor should exist everywhere except philanthropy. I think people like our voice because it’s authentic. We believe giving should be easy and fun. People like engaging with something that is real, not some generic text. Also, the incentives to donate can be really silly and nonsensical. We’ve found the more off the wall the incentives, the higher the engagement. It’s more interesting to email your friends and say, “donate $25 to my fundraiser and you’ll be signed up to win a bag of combs,” than it is to tell them they could win a gift certificate. Gift certificates work too, but we embrace the absurd, and our users really like that. And let’s be honest, there’s truth to our saying “If you don’t give, no one will like you.”

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