How Crowdfunding Sites Multiply Nonprofit Revenue

The idea of pooling funds to support a cause has been around since long before the internet: The American Red Cross was founded in 1881. The United Way in 1887. If you donated to door-to-door campaigns by one of these organizations (or even went door-to-door yourself), you participated in this classic form of fundraising. But today, we’ve traded the clink of coins in tin cans for the click of a mouse on the internet – and crowdfunding sites have become a major source of donations for nonprofits.

What Are Crowdfunding Sites?

Crowdfunding sites are websites where individuals can make donations to a company or cause. The funds are collectively pooled for a specific purpose or organization, using the power of the “crowd” to contribute toward a common goal. Nonprofits often use crowdfunding sites to help bring in more revenue.

Crowdfunding sites are powered by an underlying platform that allows the organizations or individuals to set up their own donation forms and pages. The site might be hosted on the platform’s domain or the organization’s domain, and can often be personalized with photos, compelling stories and even branded colors. Some of the most popular crowdfunding sites are Donately, GoFundMe, Kickstarter and Indiegogo.

Benefits of Crowdfunding Sites for Nonprofits

Nonprofits use crowdfunding sites for one simple reason: They work. Here’s how nonprofit crowdfunding can multiply your revenue.

Raise Money Quickly

Crowdfunding sites make it extremely easy for individuals to donate to your cause. All they need to do is click a link and fill in some quick information. They’re also easy to promote through social media, email, and word of mouth, and could even go viral and earn publicity on other channels, like the news. Plus, most campaigns have start and end dates, as well as a tracked financial goal, which gives them a sense of urgency that helps drive donations.

Social proof is the idea that people are more likely to donate to a cause if they see that others are already doing it. Crowdfunding sites use this idea to help drive donations through features like donor walls and team fundraising. They also allow donors to easily share your page or share the fact that they’ve donated, further generating social proof. You can encourage social proof by offering incentives to people who donate first or share your cause.

Spread Awareness

The ability to easily share your site doesn’t just encourage immediate donations. It can also help spread awareness of your cause to educate the public, generate interest in your organization, help drive future revenue, for example, through attendance at events, and develop relationships with potential volunteers or advocates. The ability to engage far-reaching audiences means the best crowdfunding sites for nonprofit startups also act as a marketing tool.

Keep Costs Down

Crowdfunding sites are also excellent options for smaller organizations and nonprofit startups because they’re more cost-effective than other types of fundraising. For example, organizing events takes a lot of time, money and volunteers. Direct mail campaigns also require resources. But setting up crowdfunding campaigns is easy, low-cost and doesn’t require physical resources, so most of the funds go directly to your cause.

How to Find the Best Crowdfunding Sites for Charity

There are plenty of benefits for nonprofits and charities, but if the crowdfunding site you choose is too hard to use or doesn’t have the features you need, you may never get that far. Here’s what to look for as you compare crowdfunding sites.

Ease of Use

Many organizations that use crowdfunding don’t have website developers and social media managers. They need their sites to be easy to set up, with the ability to track donation data through an intuitive dashboard. If you’re looking for crowdfunding sites for churches or schools, for example, this is an important criteria.

Customization

If you need a straightforward platform, you might think you have to compromise on how your page looks. But crowdfunding sites can be both easy to use and customizable. By allowing you to publish a story, use photographs and change your fonts, colors and call-to-action buttons, the best donation pages make it simple to add a bit of branding and personality.

Networking Tools

Like customization, you also don’t have to compromise on networking tools. Today, easy sharing on social media is expected. Top crowdfunding websites also offer integrations with your preferred programs like Mailchimp, HubSpot, Salesforce and Webflow. Peer-to-peer fundraising is also essential for nonprofits, as it allows individuals to raise funds on your behalf. And text messaging is a modern feature that gives your donors an even easier way to give.

Fees

It’s no surprise that fees are often top of mind for nonprofits. However, beware of any crowdfunding sites for nonprofits that claim to be free. The truth is that most platforms aren’t truly free. While they may offer free sign-up or remove platform fees, they’ll still take a percentage of each transaction or a percentage of the overall money your fundraiser earns.

It’s important to read the fine print and make sure you get the fee structure that’s best for you. For example, Donately’s free version has no subscription fee and just a 4% transaction fee. Crowdfunding sites for businesses, on the other hand, may not prioritize fees as much.

Trust and Security

Lately, it seems like GoFundMe alternatives are popping up everywhere, but before you go with an unknown, think about whether your donors will trust the platform. When donors are providing financial details, they want to know that their information will be secure. The best crowdfunding sites comply with data privacy standards and leverage tools like encryption to protect donor data. At Donately, we also partner with trusted payment processors like PayPal and Stripe to help provide peace of mind.

Drive More Donations with Crowdfunding Sites

Ultimately, crowdfunding sites have a lot of upside for nonprofits and very few downsides. They can help you reach new audiences and raise money quickly, while keeping your costs down. But it’s important to find a site that has all of the features you want and keeps your fees affordable.

If you’re looking for nonprofit, church or education crowdfunding sites, Donately is your ideal platform. Plus, we’re fully customizable, so we’re perfect for individuals, businesses and agencies, too. Get started today to see how we can help you multiply your donation revenue.