GoFundMe Expands Charitable Arm, With Plans to Support Broad Causes

The crowdfunding website GoFundMe announced today that it’s expanding its charity arm to allow more donors to receive tax benefits when they give to its campaigns.

The move gives donors another outlet for tax-deductible giving, which could spur more donations, but also puts nonprofits in more direct competition with campaigns run by individuals.

GoFundMe.org, a new iteration of the company’s nonprofit Direct Impact Fund, which started in the fall of 2017, will now include GoFundMe Causes. Causes will enable donors to support either a specific fundraising drive or a broad mission that will include multiple campaigns.

The Causes program will focus on fundraising for animal rescue, the environment, elementary and secondary classrooms, mental health, “kid heroes,” and veterans. The organization plans to add new causes on a regular basis, according to Raquel Rozas, GoFundMe’s chief marketing officer. “We started with the six by looking at what our existing donor community was most engaged with, which causes have been trending,” Rozas says.

The company has a team charged with vetting individual campaigns to include under the Causes banner to be sure no fraud is occurring in the drives. GoFundMe.org’s board members will aggregate campaigns into each mission area and decide how to distribute donations.

“We’re looking at incorporating a nonprofit representative for the board,” Rozas says.

$5 Billion Raised

The Direct Impact Fund was started to quickly mobilize support to respond to natural and human-caused disasters.

The latest move, Rozas says, “is allowing us to leverage the reputation of the GoFundMe brand and help donors discover more causes that they care about.”

How successful this new venture will be will depend in part on how effectively it’s marketed to donors, says Jeff Giddens, president of NextAfter, an online-fundraising research and consulting company, in an email to the Chronicle.

It remains to be seen, he says, whether donors will embrace giving to GoFundMe.org’s Causes when they can’t direct exactly where their money will go.

“Trust is a key component in fundraising,” Giddens writes. “With the current ‘direct giving’ experience, it’s clear that donors trust GoFundMe to deliver funds to their friends. There’s a good amount of verification here — i.e., you can probably find out from your friend if the funds were delivered. But will donors respond the same way when they don’t personally know the person who is receiving the funds?”

The crowdfunding company GoFundMe, which began in 2010, has raised more than $5 billion so far from 50 million donors. In December, it released data reporting that 61 percent of people who gave via the site in 2018 were first-time donors.

Fundraising drives on the site run the gamut, though campaigns to raise medical and funeral or burial expenses for individuals and families are very common. The company does not share data on which types of campaigns are most prominent.

Some nonprofits use the site to raise money for specific projects. The Time’s Up Legal Defense Fund has raised $24.2 million on GoFundMe so far, making it the largest nonprofit campaign to date.