Yesterday I wrote a blog post about how sites like FirstGiving (and JustGiving, Facebook Causes, etc) are a great way for web savvy people to raise money for their favorite charities and non-profits. What most people might not know, is that such sites charge a service fee for every dollar donated. I’m not at all against people earning a living from innovative services – even if those services are meant for charitable uses.
Rather, I was hoping to start a discussion on what is a reasonable service fee for being a middle man. In my original article, I pointed out charities like Save the Children (a vast international charity with staff in thousands and offices around the world) takes only 8% for their overhead costs. Sites which act like a fundraising middle man, like FirstGiving for example, can sometimes charge service fees as high as 7.5%.
Many of you left great comments – both on the original blog post and in the version of this that is attached to my facebook profile. I’m honored that FirstGiving also decided to make an official comment, which I’m including here:
Hi Shawn, this is Beth, Marketing Coordinator at FirstGiving. It’s good to see so many people concerned about donors’ money getting to nonprofits as efficiently and transparently as possible. All of us at FirstGiving are concerned about that as well.
Both FirstGiving and JustGiving’s fee are structured the same way and are under 5% (plus credit card charges). In the UK, tax payers can claim Gift Aid. This covers the cost of our fee and automates the tax rebate directly to the nonprofit.
With the fee FirstGiving earns on donations, we provide our nonprofit partners with secure donation processing, unlimited customer support for staff, supporters and donors, fundraising planning and strategy sessions, event management, data management, and a product that constantly evolves with the market and in response to our client’s needs. Average costs of professional fundraising can be upwards of $0.20 on the dollar, so many nonprofits are willing to partner with FirstGiving for the exceptional value we offer. Additionally, we frequently hear that the costs of building and supporting their own their own system in-house far outweigh the benefits of using FirstGiving.
FirstGiving’s product is not the right fit for every organization, but for thousands of small and mid-sized organizations, FirstGiving pages have allowed them to benefit from the support of people like John and Sarah Green. We’ve helped nonprofits to exceed their fundraising goals and garner donations from networks they would only have access to through our fundraising pages. And we’re really proud to have helped thousands of people like John and Sarah raise over $120 million online for causes they care about in our mission to expand the world of giving.
If you’d like to speak further; please feel free to contact me. I’d be happy to speak to any additional questions you may have.
Warmly,
Beth Pickard
What are my thoughts? Find out after the jump.
