Monthly Archives: April 2012

Is crowdfunding an option for your nonprofit?

Crowdfunding, a means of getting people to pool their money to raise capital, is no longer just for business startups and artists. Sites like, CauseVox and Fundly now attract hundreds of nonprofits raising money for their causes.

Crowdfunding was inspired by crowdsourcing—networking to build collective cooperation and trust for a shared effort. Crowdfunding has long been a popular model for disaster relief, international microenterprise, and political campaigns.

But with the rise of social media, opportunities are soaring for nonprofits to crowdfund to raise dollars and visibility. Even sites like Kickstarter and indiegogo, which aren’t non-profit specific, are used more and more for organizational fundraising.

Crowdfunding sites let your nonprofit set up an online campaign based on a fundraising page, and you can accept funds directly from that page using the website’s credit card processor. The sites are designed so supporters can get their colleagues and friends to donate too, either by setting up their own fundraising pages or those that link to your “master” campaign page.

Some sites like Kickstarter are geared more toward tangible products like films and art exhibitions, and their nonprofit users tend to be arts organizations promoting such products. Others, like CauseVox, are more broadly geared toward nonprofits. But all crowdfunding sites work best for specific projects or campaigns, rather than general fundraising such as annual giving.

But crowdfunding is not a magic cure for all fundraising woes. It takes strategic effort to get traction on your campaign from your inner circle of supporters, and to create the compelling messages that will spread the word beyond that circle. The sites provide you with the tools to report and thank donors, but someone needs to manage the process. And crowdfunding works best for quick turnarounds—the money comes in and you need to use it for what you promised, without delay.

Crowdfunding sites vary in costs and features. Make sure you choose one that’s visually appealing, easy to use, and fits your needs. For instance, some sites like KickStarter require a video, while you only need pictures for others like Check out the total cost of the fundraising platform—some have set-up fees, monthly fees, credit card processing fees, fees for sending you a check, etc. Don’t forget to investigate what payment methods donors can use, including e-checks.

Also look at the actual networking capabilities. How easy will it be to link to and promote your fundraising page on social networking sites?  Can your supporters set up their own pages and have donations funneled through them back to you?

Most importantly, check out the site’s stats and success stories, and ask around. There are more crowdfunding sites hitting the web every day, but not all of them are widely attracting people to browse for causes and make donations. Pick a site that people are using!

You’ll learn much more about crowdfunding and its potential for your nonprofit, the Alliance’s upcoming conference Powerful Networks: Nonprofits, Social Media, & Community in just a week—register now! 

Fundraising in the cloud

Is your fundraising management in the cloud?

Cloud computing refers to applications and resources you use through the Internet, like Webmail. These are hosted and run by servers connected to the net–servers you don’t have to host or support.

Fundraising in the cloud has taken off in the last few years, with nonprofits using cloud-based customer relationship management (CRM) systems to find and manage donors. CRM applications that run in the cloud are the cheapest, safest, and most efficient way to streamline fundraising operations so that all your information is accurate, up-to-date, and smoothly integrated with your fundraising operations.

The Alliance is excited to welcome Tal Frankfurt from Cloud for Good to this year’s annual conference. Cloud for Good is a Memphis-based national consulting firm that helps nonprofits create strategic cloud-based solutions, including CRM. Frankfurt will present on how to use CRM databases to build fundraising capacity and get better results from your efforts.

Cloud for Good specializes in helping nonprofits implement SalesForce,  a CRM system that offers a version for nonprofits to track constituents, partners, donors and their donations, activities, volunteers, and more. SalsaLabs/Democracy In Action is another option, mostly for small organizations focused on social change. Many other systems are available, and customizable, for all kinds of nonprofits.

CRM can help your nonprofit target potential donors, establish plans for contacting them (not too much or too little), and convert them into actual donors. CRM systems keep track of all your conversations, interactions, and results. They help you develop channels for crafting specialized messages for different audiences, and for engaging people to do more—call their Senators, attend an event, read your new report. They tie into your website and link to social media avenues like Facebook and Twitter to help increase the reach of your efforts. They provide extensive analytical capabilities—you can chart the success rate of your campaigns and learn what worked and what didn’t. And they allow everyone in your organization to access a unified, continually updated view of donors and potential donors.

Have a recommendation for a CRM system you use and like? Want to know more about working smarter and faster through CRM in the cloud? Don’t miss our annual conference on May 2–register now!

The dark side of social media

A few weeks ago, a blogger who posted defamatory comments about a local landfill owner on the website of New Orleans’ Times-Picayune newspaper was revealed to be a Federal prosecutor. In December, three young Congressional aides decided to get drunk at the office every day and tweet about it, not as anonymously as they—or their boss, Representative Rick Larsen–might have hoped. Last winter a staffer at the Red Cross slipped up, accidentally alerting the organization’s Twitter followers that he was about to get “slizzerd” on expensive beer.

As nonprofits that raise money and rally support online, we’re generally focused on the benefits of social networks. But what about the risks? The cloak of online anonymity can easily be raised, and lines between business and pleasure accidentally crossed. It shouldn’t come as a surprise that law firms specializing in social media law are on the rise.

You can’t completely protect yourself from the dark side of social media, but you can minimize the chance that a disgruntled or careless employee will damage your nonprofit’s reputation. (Or worse, lead to a libel or harassment lawsuit.) A social media policy is a good place to start. What to think about if you don’t already have one?

1. Understand and communicate the importance of the policy. For example, employees should know that information posted in social media can be used as evidence in a court of law. Also, actions taken by employees can be held against an employer, on the clock or off. And you might also remind your staff that there’s really no such thing as “anonymous”—deleted data can almost always be recovered using cyber forensic tools.

2. Require that personal postings be carefully distinguished from those of your organization, such as by using a disclaimer that the views and opinions expressed do not represent those of your organization. Also require employees to conduct official business only through the organization’s social media accounts and ensure that the organization’s accounts should not be used for personal affairs. Although employees may share your organizational positions and agenda, they should avoid even the perception that they’re speaking on behalf of your organization in unofficial communication.

3. Make ownership of your social media accounts explicit. Cases are on the rise in which employees leave an organization and take valuable social media content and contacts with them, resulting in disputes over who “owns” this information. Avoid confusion by clarifying that Twitter followers, Facebook friends, and other online contacts generated through your organization’s work belong solely to your organization.

3. Make clear that what’s illegal in the real world is also illegal in the virtual world. Your policy should prohibit:

  • Mishandling of intellectual property (with regard to both protecting yours and infringing on others’.)
  • Discriminatory statements, racial slurs, and sexual innuendo that can lead to hostile work environment and harassment claims.
  • Political campaign activity attributed to your organization, which can endanger your 501(c)(3) status.
  • Improper disclosure of confidential or proprietary information. If an employee blogs or posts information about a donor or constituent, she shouldn’t reveal any personally identifiable information about that person without authorization.

4. Make sure your social media fundraising complies with charitable solicitations laws. Most states require registration for nonprofits that solicit funds within their jurisdiction. In some states, just having a “Donate Now” button can trigger the registration requirement, as can social media fundraising activities. If your fundraising targets people who live in other states, be aware you are subject to their requirements as well as those where your organization is located.

5. Do not impose a draconian, unrealistic social media policy. Many organizations have tried to impose all-out bans on social media to avoid the risks, and have found themselves on the losing side of a lawsuit. Your policy should govern the prudent use of social media, not prohibit employees from participating. It should provide guidance on what employees can and cannot do in social media, both in their role as employees and in their personal use, and fit the mission, culture, and needs of your organization.

Got questions about social media? Get May 2 on your calendar and register for our annual conference! We look forward to seeing you at Powerful Networks: Nonprofits, Social Media, & Community, with some of the country’s leading voices in the field.