Monday, February 19, 2007

The Problem with Donors Choose, or, Am I Really this Jaded?

A friend of mine just sent me this article from Slate to ask if I knew about this sort of program:
Want To Buy My Students a $392 Camcorder?
A nonprofit uses the Web to work marketplace magic.


The article discusses this site:

DonorsChoose.org: Teachers Ask. You Choose. Students Learn.

Here was my reply:

I've heard about it. It's spawned a whole host of other sites, all of which are completely counter to developing a sustainable, effective business. These sort of "novelty sites" allow donors to feel good about themselves while designating their funds to something like a telescope or a computer -- all nice things that don't help keep the lights on or make sure that there's a teacher to lead the class. And those, I am afraid, are the real things that donors need to fund.

There's a nice hybrid of this sort of program offered by the major international organizations such as Heifer International (http://www.heifer.org/). The site allows donors to "shop" for items like a goat or a cow, so that they feel in control ("Wow, I bought this pour villager an ox to help with his farming!"). However, they include this very important language:
"The prices in this catalog represent the complete livestock gift of a high-quality animal, technical assistance and extensive training. Each purchase from this catalog represents a contribution to the entire mission of Heifer International. Donations will be used where needed most to help struggling people. Heifer International is a non-profit 501 (c) (3) organization."

In other words, when you pay $500 to "buy a heifer," you are really just giving them $500.... and they might be a heifer, or might not. It's pretty brilliant, actually, and is something I've thought about on more than one occasion.
But the more I think about it -- the more concerned I get about this kind of hoodwinking. Sure, it raises a lot of money. When you look at their annual report, Heifer raised over $80 million through contributions to programs like this.

(Nevermind that they spent nearly 25% on fundraising and M&G....)

But I have to wonder... is this the best way to conduct business?

I think that its critical to provide donors with the assurance that their gifts are being used effectively. It's also important to honor their wishes.

However, there must be some middle ground between the way that sites like DonorsChoose completely bows down to the fickle whims of donors' clicks and the way that Heifer International pulls the wool over donors' eyes in order to fund their work (including their exhorbitant overhead).