charity : water taps online donors to raise $20 million

Scott Harrison was disillusioned with the life of a nightclub promoter when he founded charity : water in 2006. Since then, his nonprofit has grown to be a world-leader in digital fundraising, reports Greg Johnson.

Charity : water (www.charitywater.org) is not yet five years old, but the New York-based organisation has become the pin-up for digital fundraising innovation. The organisation, which funds the construction of water wells and filtration systems in poverty-stricken countries, raised its first USD$10 million in just three years, largely by leveraging social networks and digital marketing.

Despite some bumps along the way, charity : water has clocked up its first USD$20 million just ahead of its fifth birthday this September. The organisation had a staggering growth rate of 85% year-on-year from 2009 to 2010, and already this year its first quarter fundraising results are up 100% on last year. It’s a success story that every nonprofit can take a lesson from.

Build a well for your birthday

One of the cornerstones of charity : water’s online fundraising is what started out as its September appeal. Everyone with a birthday in September (like founder Scott Harrison) – asks friends to donate their age in dollars. Using peer-to-peer fundraising and fundraising pages, it raised USD$150,000 in 2007 with 92 people taking part, before growing to USD$950,000 with 800 people a year later.

The September appeal has grown to be a year-round fundraising effort by charity : water’s supporters. It has been so successful that the mycharity : water website (www.mycharitywater.org) was the source of 70% of charity : water’s fundraising last year.

The birthday appeal has pulled in some big-named supporters too, with teenybopper icon Justin Bieber one of the latest to get involved, asking for USD$17 donations to celebrate his 17th birthday. The Canadian singer set a campaign goal of USD$17,000 on his fundraising page, however some 2,128 people made an average donation of USD$22.34 for a total of USD$47,544.

Downturn delivers a dilemma

Being a reasonably new charity, based in the United States’ financial heartland during the Global Financial Crisis, nearly brought the charity : water success story undone. Its guarantee that 100% of public donations go to service delivery, while operational costs are raised separately, saw charity : water’s operational fund shrink to less than USD$100,000, or five weeks of operational expenses, as donors’ wallets closed while the economy imploded.

Harrison held what he felt was an unsuccessful meeting with internet entrepreneur Michael Birch over charity : water’s plight. Harrison was shocked however when later that week Birch emailed him about the USD$1 million he had wired charity : water to cover the organisation’s operational expenses for the next 13 months.

The generosity of Birch and his wife Xochi was recognised by the construction of five wells, one each for them and their three children. The couple, who made nearly USD$600 million from the sale of social networking website Bebo in early 2008, have remained both major financial and technical supporters, by assisting with the development of mycharitywater.org.

While fortunate to have scraped through the downturn, the hole in charity : water’s model wasn’t lost on Harrison. He established a separate giving program called The Well, through which operational funds are raised from private major donors and corporate partnerships, which have became a focus in the GFC’s aftermath.

Creative accountability a key

To ensure its 100% guarantee, The Well even reimburses charity : water for credit card transaction fees from donations. It’s not just the 100% guarantee, though, that provides accountability and builds trust for charity : water’s donors.

The organisation provides an unprecedented level of insight into its service delivery. It discloses the GPS co-ordinates of each and every well it funds, while providing the ability for donors to view those wells plotted on GoogleMaps through its website.

Charity : water also communicates with donors on a daily basis, either through its photo of the day on Twitter, the blogs on its website or frequent YouTube videos. It’s worth noting that this content is of a remarkably high production value: blogs are informative, images are beautifully composed and videos are also of a high quality.

These factors make it easy to see how charity : water has gained 1.35 million and 4,500 followers on Twitter and YouTube respectively. It also offers those users a good level of interaction, with supporters able to e-mail questions through for the drilling teams in the field to answer.

Return to traditional fundraising

Ironically, the nonprofit that mastered a space other organisations are grappling with is now looking to expand its activity in the more traditional, offline fundraising streams. Since the GFC, charity : water has raised USD$700,000 from a corporate partnership with retailer Saks Fifth Avenue, while its annual ball, held since the organisation’s inception, raised USD$1 million in 2010.

While charity : water has raised nearly USD$20 million in just under five years, it hopes to grow offline fundraising alone to USD$20 million over the next three years. It has an ambitious plan to raise USD$2 billion over the next decade and provide 100 million people with access to clean water.