Technology Makes It Easier for a Charity’s Supporters to Raise Money

To celebrate his 40th birthday, Michael Lodish vowed to complete the 2010 Marine Corps Marathon. And along the way, he wanted to raise some money from friends and relatives to benefit charity.

Mr. Lodish, a former preschool teacher who is now studying for a master’s degree in counseling, learned from a cousin about a Web site called IndieGoGo that allows anyone to set up a fund-raising page.

Within a few weeks, Mr. Lodish raised $5,000 on the site for the Amyotrophic Lateral Sclerosis Association in memory of his uncle, who died of ALS—commonly called Lou Gehrig’s disease—in 2008. He finished the marathon in four hours and 47 minutes.

More and more charities are trying to appeal to do-it-yourself fund raisers like Mr. Lodish who are putting their mark on online fund raising by collecting thousands and occasionally millions of dollars for charity from people they or their friends and relatives ask.

Individuals can use free or low-cost sites such as Causes, Crowdrise, FirstGiving, and Razoo to create a personal fund-raising campaign, decide which causes to support, and ask people to contribute. They can share photos and personal messages and link to social networks such as Facebook and Twitter.

In other cases, charities are building the same fund-raising capabilities on their own Web sites, using software by companies such as Blackbaud and Convio, and trying to get supporters to ask people they know for donations.

All of these approaches have one thing in common: “We’re looking at the world from the donor’s perspective as opposed to being led by the nonprofit,” says Jeff Patrick, president of Common Knowledge, an online fund-raising consulting company in San Francisco.

“People feel like they have influence and more power,” says Joe Green, the co-founder of Causes. The site, which is primarily used by Facebook members, has attracted 150 million people who have raised a total of $30-million for 27,000 nonprofits.

Mixed Success

Charities’ success in persuading volunteers to raise money on their behalf has been mixed, but it’s easy to see why the idea is attractive. The bad economy has forced many groups to seek low-cost alternatives to direct mail, telemarketing, and other expensive approaches.

Sites that make it easy for volunteers to raise money can also reduce the time a charity’s staff spends on logistics.

When Concerns of Police Survivors, a Camdenton, Mo., charity that aids families of slain police officers, adopted Razoo to raise money for its annual walkathon, it says it cut the amount of time its staff spent on managing the event by three-quarters. Participants could easily register online without staff help and ask friends and relatives to give.

But it is unclear whether charities can count on volunteer fund raising to deliver consistently large returns. In part that is because nobody knows how easy it will be to turn people who give to help a friend or relative into a charity’s cadre of loyal supporters.

The challenge can be seen in the American Heart Association’s effort to move its successful friends-soliciting-friends venture online. Each February since 1956, the American Heart Association has enlisted volunteers to write letters to people who live nearby as part of its Dear Neighbor Campaign. Over the past decade, the campaign has raised up to $21-million annually from 600,000 to 1 million letter writers per year. While many of the letter writers now compose e-mail messages instead of paper letters, the charity says it still gets less than one half of 1 percent of donations online.

Nonetheless, online social networks have transformed the idea of fund raising for charities of all kinds. Listed on the left are the five ways charities are tapping into the power of volunteers to raise money for them.