Is Crowdfunding the way forward for non-profits ?

Donations needed

As the social landscape changes so does the need to find new and innovative ways for non-profits to raise their funds.  Here I take a look at Crowdfunding vs more traditional methods.


Non-profit organizations income streams originate from a combination of sources such as:

  • Individual and small scale giving
  • philanthropy and major donors
  • fundraising events and challenges
  • grants, funds and corporate fundraising

According to Giving USA $358.38 billion was donated to US charitable causes with individual contributions accounting for 72% of all donations in 2014.

Traditionally, the majority of non-profit organizations have attempted to attract donations from individual donors through a combination of methods including direct marketing, newsletters, social networking (on and off line), community fundraising, special events and employee donations.

Blackbaud’s 2014 Charitable Giving Report analyzed trends from over $16.2 billion in fundraising revenue and found that in 2014 overall giving grew approximately 2.1% with online growing 8.9% and accounting for 6.7% of all fundraising with small organizations having the greatest increase overall.

The Nonprofit Research Collaborative 2014 fundraising study found that 62% of organizations reported growth in traditional methods such as major gifts, email requests, special events but also with more non-traditional “other online” methods.

Both credible studies suggest that although traditional fundraising methods remain an integral cog in the nonprofits fundraising wheel newer and innovative ways to raise money such as online and Crowdfunding are gaining substantial ground and will become an important part in any fundraising strategy.


It is clear then that non-profits in search of funds and awareness are needing to move with the times and incorporate a crowdfunding campaign to compliment their existing efforts and increase their presence within the social media landscape.

According to Bob Mulholland modern non-profits are using crowdfunding to raise money and awareness for their causes as it offers greater exposure at a lower cost and tends to succeed because of incentives that organizations promise in exchange for donations.

A recent Crowdfunding Industry Report finds that 30% of the $5.1 billion raised in 2013 was for social causes with the average successful campaign raising approximately $7K over nine weeks.

Further research by MobileCause tells us that $568 is the average raised by Individuals crowdfunding and accounted for 18% of US giving in 2013, $66 is the average amount donated with 62% of people who give to crowdfunding campaigns are new donors.

Crowdfunding for social causes has evidently gained momentum over recent years as Craig Newmarks “Cracking the Crowdfunding Code” shows with some impressive statistics:

  • $88 is the average donation size,
  • $534 the average total amount raised by an individual
  • $9,237 is the average amount raised when groups are working on a team to raise funds
  • 28% of donors are repeat donors

Cracking The Crowdfunding Code

crowdfunding nonprofit

Crowdfunded campaigns are largely based online so they are able reach much further than more traditional methods of fundraising but with the ever increasing number of online campaigns it important to differentiate to stand out from the crowd.

Donations to charitable causes may be at an all time high but so are the amount of causes attempting to attract new donors so the platform used and the tone of the campaign must be right to strike a chord with the public and generate some early momentum.  Research shows that campaigns that receive their first donations within the first three days are more likely to reach their goal than those that don’t.

As discussed in my previous blog Crowdfunding has a bright future and as early adopters non-profits have found themselves in an enviable position of being its biggest beneficiaries but will they be able to continue to innovate their strategies to stay ahead of  the crowd?