January 11, 2001 | Read Time: 4 minutes
By NICOLE WALLACE
Internet start-ups focusing on the nonprofit world have not been immune to the financial turbulence that has hit the high-tech industry.
Two online giving portals have ceased operations.
The founders of Shine, whose preview site went online in April, decided not to move forward with the site because they were unable to raise the venture capital necessary to sustain the site and expand to run on-the-job charity drives, which the company had hoped would be its primary source of revenue.
Stephen C. Nill, chief executive officer of CharityChannel, a company that sponsors e-mail discussion lists for nonprofit professionals, served as Shine’s chief charities officer. Mr. Nill says that he now questions whether any commercial giving site targeting individuals can be successful.
“A commercial site that relies on people coming to the site and making charitable donations is not going to be sustainable in the long run because they either have to charge a percentage of the money being donated — in which case they’re not going to be competitive with a site like Helping.org, which is passing it all along — or they have to have some other source of revenue.”
Another donation site, OnGiving.com, shut down on November 4, also citing financial reasons.
In addition, two online giving sites have been bought by other companies.
Beliefnet, a multifaith Web site on religion and spirituality, acquired CharityCounts in December in order to offer its visitors the ability to make online donations and to participate in charity auctions. The CharityCounts technology is scheduled to be fully integrated into the Beliefnet site this spring.
In November, Worth Interactive — the company that runs Worth.com, a Web site for wealthy people that includes information on charitable giving — bought online giving site Givenation.com.
But giving portals haven’t been the only ones to feel the financial pinch.
IReachOut.com, an online shopping mall that allowed customers to donate a portion of their purchases to charity, has closed its virtual doors. And although The Chronicle wasn’t able to confirm whether the company had gone out of business, the charity shopping site Shop2Give has been offline since the middle of November.
Another charity shopping site, GreaterGood.com, which runs the popular Hunger Site, also appears to have run into financial problems.
At the Hunger Site corporate advertisers make donations to anti-hunger groups every time visitors to the site click on its “donate now” button. Last month, the United Nations World Hunger Programme, the Hunger Site’s primary beneficiary, ended its affiliation with GreaterGood, citing delays in receiving donations (The Chronicle, December 14). The company blamed the problem on trouble getting corporate sponsors to pay their bills on time.
GrantSeeker, a Web site whose members had access to a database of grant makers in California, New Jersey, New York, Pennsylvania, Ohio, and Texas and could get advice on applying for foundation grants, has suspended operations and is no longer accepting new members.
Yet despite the financial problems that many philanthropy Web sites have encountered, new players continue to enter the field.
Two new giving sites went online this fall. Both are set up as nonprofit ventures.
JustGive.org (http://www.justgive.org) is a nonprofit organization in San Francisco founded by Kendall Webb, a former e-commerce executive, to increase giving by making it easier for donors to learn about charities and make contributions. JustGive.org’s Web site allows donors to make online gifts to more than 640,000 charities across the country. Corporate sponsors, such as Aveda and Oracle, cover the costs associated with processing the online gifts so that 100 percent of the donor’s gift goes to charity.
Since JustGive.org went online in mid-October, almost $200,000 has been donated to charity through the site.
Ms. Webb believes that being a nonprofit venture gives the site an advantage over its competitors.
“We have one single mission, which is to increase giving, and that’s the only thing we need to focus on. We don’t have to focus on making profits for our board.”
Three college students at Queen’s University in Kingston, Ontario, founded CanadaHelps.org (http://www.canadahelps.org), a nonprofit donation site that allows visitors to make online contributions to Canadian charities. The cost of credit-card processing is the only fee subtracted from gifts made through CanadaHelps.org.
A new charity shopping mall, TiesThatBind.com, has also entered the fray. The company was founded by three fund raisers in Lawrence, Kan. Shoppers can donate a percentage of their purchases at the site — generally 4 to 6 percent — to the participating charity of their choice.
