1 Million Campaigns and Counting: DonorsChoose.org’s CEO Looks Ahead to the Future of Crowdfunding

As of Thursday, 1 million projects have been financed through DonorsChoose.org, the online charity founded in 2000 by Charles Best. Mr. Best, still the nonprofit’s CEO, was a history teacher at a public high school in the Bronx, N.Y., frustrated by the lack of resources for classroom projects. Today, more than 70 percent of all public schools in America have solicited support for projects on DonorsChoose.org, drawing more than 2 million donors and raising $629.5 million to date.

The organization, which helped pioneer the now-ubiquitous crowdfunding trend, has been influential for scores of charities looking to raise money online. As DonorsChoose.org reaches its milestone, Mr. Best spoke to The Chronicle about the future of crowdfunding. Following are excerpts from the conversation.

Congratulations. What do you wish you’d known about crowdfunding when you began?

At first, our website was only open to public schools in New York City. We didn’t even dream beyond the borders of the city in terms of who we would serve.

From the get-go, DonorsChoose.org was purpose-built for teachers in low-income communities, and therefore I assumed out of the gate that 100 percent of the people giving to projects on our site would have to come from DonorsChoose.org doing marketing and doing outreach and building a community.

What I didn’t anticipate back then was that at least a portion of funding for classroom projects did come from teachers rallying their networks. Maybe it would not be their students’ parents, because that didn’t feel totally appropriate. But it would one day be teachers’ Facebook friends and teachers’ classmates and ex-girlfriends and ex-boyfriends wanting to get back in touch, giving to projects on our site.

So you didn’t anticipate the size of their social networks, in the old-fashioned sense of the term?

Exactly, because this is years before Facebook. I had no anticipation that the rise of social media would enable teachers in low-income communities to rally funding for their classroom projects, regardless of the economic status of their kids’ parents.

What trends have you been seeing that point to how crowdfunding is evolving and where it’s headed?

Crowdfunding has largely become websites that exclusively enable someone to tap their network to raise funds. Most crowdfunding sites are, at their heart, utilities that enable you to hit up the people you know and to reach out to your social network to raise money for a cause or a project or a need. And today, actually, 75 percent of the money given to classroom projects on DonorsChoose.org comes from people and partners who’ve never met the teacher that they support; 25 percent of project funding comes from teachers rallying funding from their networks.

I think people will soon start to identify and appreciate the small handful of crowdfunding sites that have developed communities of people who want to support projects created by people they’ve never met.

What about those third-party crowdfunding sites? After DonorsChoose, you’ve got GoFundMe and Kickstarter and IndieGoGo, etc. How will that field change? Do you think there will be consolidation among them, or do you think they’re just going to keep proliferating?

Those sites will ultimately have to just compete on their percent commission. Because if you’re a fundraising utility, then your value comes down to the commission that you take out.

One thing that we’ve been seeing is more established nonprofits like universities bringing crowdfunding campaigns under their own umbrella. Do you think that will increase?

We’ll see more of that. People always inherently had a desire to see where their money was going and feel a connection to the people they were trying to help. But the rise of crowdfunding has made more and more people feel like they can demand that experience. Which in turn has meant that even traditional fundraising operations run by universities, museums, etc., are creating these crowdfunding campaigns.

When DonorsChoose.org began, it was almost an alien concept to people that you would go to a website and express a personal passion and look at projects that match your passion and give to one and hear back from the people you chose to help.

One reason DonorsChoose.org had a slow start was because the concept itself was kind of foreign to people.

Now that the rise of crowdfunding has made it really natural for people to say, if I’m feeling altruistic, I’m going to find a project that really speaks to me, and I’m going to back it or donate to it and see where my money is going and be able to follow along as the project comes to life.

Most crowdfunding campaigns are aimed at specific projects. Do you think there’s a place for it in raising unrestricted funds, endowment, operating costs, and so forth? Or is that just the wrong vehicle for funding those needs?

Kickstarter has shown that a project creator can raise somewhat unrestricted funds. It would be tough for someone at a university to say just give to our endowment, period, and have it feel like the donor was giving to a particular project. But those projects where the creator brings the donors or the backers on a creative journey are the ones where backers can be more flexible about exactly how their donations are spent.

On DonorsChoose.org, one reason people give is because they can see exactly which books are going to be purchased and shipped and exactly which museums students are going to go to on the field trip. And that specificity and granularity of project-funding request is so much of the appeal. But I guess if the university is doing crowdfunding, they have some other dynamics they can call upon, like competition. Show that you and your fellow dormitory mates are more generous to your alma mater than another dormitory that you had a rivalry with.

Can you point to an example that you think exemplifies today’s successful crowdfunding campaign?

I’ll mention a scenario on DonorsChoose.org that both shows the promise and how far crowdfunding still has to go.

The magic happens when someone expresses a personal passion.

A couple of years ago, I was talking to someone who said that their personal passion was saving the salmon in the Pacific Northwest. And we did a search together for “salmon” and then “Northwest” on DonorsChoose.org, And there were five projects to choose from where teachers were doing something to preserve the salmon population in the Northwest.

And yet as much as crowdfunding is a lot better known than it was when we were operating out of my classroom, most people don’t yet have a ready answer to the question, What is your philanthropic passion? What’s the affinity you’re going to express when you’re next looking for a project to support?

People are still mostly familiar with the typical crowdfunding model of, just wait until your nephew hits you up on Facebook for their particular campaign. And that’s your prompt to give.

It’s still a challenge for us to elicit your favorite author or the sport you played in high school or the hobby that you’re pursuing now. So we can then show you projects that match your passion.

Is there also an issue with crowdfunding projects being too niche? I mean, what if my favorite author is James Baldwin and I find projects that are teaching people to like James Baldwin — but what we really want to do is increase the literacy of high-school students?

If you just looked at a single classroom project on DonorsChoose.org, that’s a solution to a single student challenge, and it’s certainly not a comprehensive capture of what students need. I think in the aggregate of a million classroom projects, if you laid out the subject areas that those million projects covered and the grade levels and the themes and the types of variety of resources, you actually feel that there was great wisdom in the aggregate.

Any one individual point of light maybe be niche. But in the aggregate, the crowd is wise,

Any other trends you’re spotting about where crowdfunding is going to go that fundraisers should be aware of?

Well, one trend we’re seeing on DonorsChoose.org is people and philanthropists using our site to support themes and causes beyond classroom education. Sergey Brin, the co-founder of Google, underwrote a match on our site for classroom projects focused on immigrant and refugee students. He wanted Americans to feel like actually lots of people out there are rooting for them. More and more people are realizing that they can use platforms like DonorsChoose.org to pursue larger causes that they’re passionate about.

What’s next for DonorsChoose.org?

New categories of projects on our site. About two years ago we started letting middle- and high-school students create projects on our site in partnership with their teachers. And we’ve also not long ago started letting teachers create professional-development projects seeking resources to become better teachers.

We have created a category on our site called Student Life Essentials, where teachers can request jackets for kids who are coming to school cold or nutritious snacks for kids who are coming to school hungry or hygiene materials that they need for their kids to be able to focus on learning.

This interview has been edited for clarity.