Large charities that do not embrace digital technologies will not survive the next decade, the chief executive of the US-based online fundraising platform GoFundMe has warned.
Speaking to Third Sector, Rob Solomon said he did not believe any large charities had yet found a way to make the most of the opportunities offered to fundraising by digital.
Today the platform announced a partnership with the youth charity Scouts, under which young people will be encouraged and supported to set up GoFundMe campaigns to raise money for causes they care about in order to work towards their fundraising badge awards.
Solomon said that in the near future donors would be offered the chance by his platform to make repeat donations and to give to causes rather than specific charities.
"I think it’s important that traditional charities embrace digital as the primary means to communicate with their constituents and raise money," he said.
"Direct mail, telemarketing and old-fashioned fundraising solutions worked in the past but those donor bases are now in their 60s, 70s, 80s and 90s and they’re not going to be around forever. So in order to connect with the next generation of potential givers it all has to happen online. That’s where they live, that’s where they consume everything."
Solomon said he believed charities on both sides of the Atlantic were still trying to figure out the opportunity provided by digital technologies.
"I don’t think any of them yet are optimising and maximising it the way they can and should do," he said.
He added that charities needed to move away from the paradigm of one-to-one relationships with donors and regular donations towards a "social paradigm" whereby one donor shared their passion with their networks, encouraging friends and family to give as well.
One of the barriers to this shift, Solomon said, was inertia.
"We’ve seen this in every industry," he said. "Either organisations slowly adapt to digital and then they flourish, or they don’t adapt and they are eaten alive.
"Certain charities that don’t adapt to this new paradigm aren’t going to be around in ten years, and those that do are going to flourish and be able to spend more time, money and resources on the cause rather than the administrative and fundraising side of things."
Solomon also revealed that GoFundMe would be introducing recurring giving "as one of the key components of the platform" in the near future.
"What we have are really temporal campaigns, but maybe in the future you’ll start to see longer-term causes," he said. "Maybe in the future there’ll be a campaign about cleaning the ocean that lives on GoFundMe, where a donor was recruited to give and then offered the chance to keep giving."
Such campaigns, he said, could be focused on a cause area, rather than a specific charity, so the money raised might be divided up between charities working in that area. But the details had not yet be finalised, he said.
The partnership with the Scouts, announced today, will encourage young people to identify good causes or charities and work with their Scout leaders to launch GoFundMe campaigns to raise money.
GoFundMe will provide tips and resources to help Scout groups tell stories, create successful fundraising campaigns and share them online.
Solomon said he hoped the move would "introduce a whole new audience to the power of fundraising through social fundraising" and foster a new generation of fundraisers.
"I suspect there will be certain superstars who create a persona for themselves as amazing fundraisers, change-makers or leaders of movements."
In the US, Solomon said, GoFundMe was the "category-defining company". In the UK charitable space, where it arrived in 2016, it has faced stiff competition from others, such as JustGiving.
But Solomon said the UK was the company’s second-biggest market and, according to GoFundMe statistics, one in 13 adults in the UK had given money using the platform.
Solomon said the growth was fuelled by the change to its charging policy in January 2018, when the company dropped its 5 per cent fee charged on money raised using its services, instead asking donors to pay voluntary tips.
This was where GoFundMe stood apart from other fundraising platforms, he said.
"We love competition and we think it’s important, but it just mystifies me that someone would profit off Gift Aid," he said.
"JustGiving is a fantastic company that’s done great things, but I think you have to evolve with the market. If you don’t, you lose market share."
JustGiving takes 5 per cent from the donation and Gift Aid given by a donor but allows donors to volunteer to pay the fee separately.