The new way to donate: Crowdfunding
In a world where technology has revolutionized the way we do just about everything, it was only a matter of time before it impacted charitable giving. Websites like GoFundMe.com, JustGive.org and GiveForward.com, have built platforms where anyone with a cause can launch a fundraising campaign. By tapping into the power of online payment tools and social media, crowdfunding is swiftly gaining popularity and paving the way for the next generation of giving.
In 2015, GoFundMe raised over $1 billion from over 16 million donors worldwide putting the crowdfunding organization on par with donations to America’s largest charities.1
From supporting victims of natural disasters to backing research for rare diseases to helping alleviate financial pressures on families caring for the terminally ill, crowdfunding sites have allowed donors to choose the causes they want to donate to – sometimes very specifically. They can see where their dollars are going and who they are impacting in a direct and transparent fashion.
The transparency of peer-to-peer fundraising movement has captured the attention and the dollars of Millennials (and even Generation Edge) in ways traditional nonprofits are struggling to do. Though Millennials represent only 11% of the nation’s charitable donations, they are starting to make a habit of giving.2 Eighty-seven percent donated to an organization in the past year.3 And it should come as no surprise that Millennials are most comfortable engaging with charitable causes via the internet with 84% of Millennials wanting to donate online.4
The internet allows these giving platforms to have a symbiotic relationship with social media. Sharing crusades with friends can make a huge impact, and Millennials don’t shy away from posting about causes and campaigns that speak to them. When a cause strikes a nerve, it may go viral. The ALS Ice Bucket Challenge made waves on the internet, raising over $115 million for the ALS Association.1 Movember, which urges men to grow a mustache every November to raise funds and awareness for testicular and prostate cancer, has raised $556 million in just over a decade.5
Crowdfunding platforms aim to tap into the power of viral campaigns. GoFundMe’s research shows that sharing a campaign on Facebook has the potential to increase funding by 350%.1 This peer-to-peer fundraising, also referred to as friend-raising, allows Millennials to use technology as a resource for organizing, and lets them use their social networks to make meaningful change not only nationally,
Millennials have embraced this new form of charitable giving more than any other generation. Seventeen percent of Millennials have donated via crowdfunding, compared to 10% of Gen Xers and 6% of Baby Boomers.2 Part of the reason why crowdfunding has resonated so strongly with Millennial donors is because it has democratized giving. Whereas many larger nonprofit institutions lean heavily on generous donations from the wealthy few, crowdsourced funds rely more on a little bit given by a lot of people. Millennials, a generation that supports causes over institutions, are turning to crowdsourcing as a way to make their voices heard. They are choosing campaigns near and dear to their hearts and are seeing the tremendous potential that donations coming from many donors can have.
Crowdsourcing platforms serve as an amplifier for voices and campaigns which may not have been heard. This new form of giving is another example of Millennials disrupting the status quo, but more importantly, it presents a simple and effective way for anyone, regardless of wealth, social status or generation, to make a difference.
1GoFundMe. (2015). Crowdfunding: A New Way of Giving.
2Blackbaud. (2013, August). The Next Generation of American Giving.
3DeAnda, F. (2014, December 16). Why Millennials Matter.
4The Millennial Impact. (2013). The 2013 Millennial Impact Report.
5Skarda, E. (2014, September 16). What You Need to Know About the 5 Most Successful Social Meida Campaigns for Social Change.
This information is prepared by an unrelated independent third party, BridgeWorks, and is provided for informational purposes only. Ivy Distributors, Inc., believes the information has been obtained from sources considered to be reliable, but does not guarantee the accuracy of the information provided.
IVY INVESTMENTS® refers to the investment management and investment advisory services offered by Ivy Investment Management Company, the financial services offered by Ivy Distributors, Inc., a FINRA member broker dealer and the distributor of IVY FUNDS® mutual funds and IVY VARIABLE INSURANCE PORTFOLIOS℠, and the financial services offered by their affiliates.