Hi friends 👋🏻

Legal and media attention continues to focus on the role for-profit companies play in nonprofit fundraising.

I'm focusing on this issue again this week with some updates and a specific trick to help you investigate your own organization's exposure.

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The triggers

Media attention on the for-profit companies that mediate the vast majority of giving to nonprofit organizations picked up in the fall of last year when it became clear that a giant in that space, GoFundMe, was creating fundraising pages for nonprofit organizations without their consent. I wrote about this at the time here.

Earlier this year, the legal community caught up, with state attorneys general and charity regulators stepping in to demand answers. More on that here. Since then, the State of Alaska has filed a lawsuit too.

Separately, a fundraising platform called FlipCause collapsed into bankruptcy last year, leaving thousands of nonprofit clients unable to access donated funds.

These aren't developments that just impact a handful of organizations.

My business is no giant operation, but I've had to help multiple clients navigate claiming and then shutting down "donation pages" that have been created without their consent.

And in the midst of the end-of-year fundraising season last year, I had to help a client quickly spin up an alternative fundraising platform after they learned that FlipCause was going under.

Nonprofit Quarterly on the risk to the nonprofit sector

Last week, Lauren Girardin published an article for Nonprofit Quarterly that does a great job tying these two stories together and highlighting the risk posed to the nonprofit sector.

I encourage you to read it here: The Gatekeepers: For-Profit Platforms, Nonprofit Power, and the Risks to Charitable Giving​

The short version: we're in a situation where (1) the majority of organizations rely on a third-party, usually for-profit company to provide their donations functionality, AND (2) there is very light regulatory oversight of how these companies operate.

As I understand it (and I'm not an expert here) California is the only state that requires fundraisers and fundraising companies to register and follow specific regulatory guidelines.

When I ran a quick search through the state database (access it here), many popular nonprofit fundraising platforms appear not to be registered at all. (Although I was pleased to see that the two I recommend most often are both registered 😅 )

And as Lauren points out in the article linked above, even in a state where some level of oversight is in place, that doesn't mean the resources are available for enforcement.

The broader argument here is that nonprofit organizations have become too reliant (and perhaps too trusting) of a group of for-profit companies to provide critical infrastructure, and that there is an obvious lack of alignment between these two groups.

For-profit fundraising tech companies are incentivized to make money. Whether they are privately-held and have raised investment rounds, have been acquired by private equity, or are publicly traded, all have to prioritize profitability alongside providing a good service to their nonprofit clients.

I think this is just the beginning of a conversation within the nonprofit sector about the relationship between organizations and the for-profit vendors we rely on.

Personally, I'm curious about the role tech platforms that are incorporated as nonprofits can play here. The example that comes to mind is Action Network, which provides fundraising tech alongside lots of other tools, and is organized as a pair of 501c3 and 501c4 entities.

Are there other examples of vendors that provide the donation form layer in between a nonprofit org and the payment processor, and are themselves nonprofit organizations?

A tip to help you find "donation pages" you didn't know about

Up at the top I promised a tip to help you uncover "donation pages" that exist out there on the web that you didn't know about and didn't authorize.

It's a fairly simple on, which just involves a Google Search.

Here's what to enter into the search bar:

Here's the full search query to copy and edit:

Let me break this down. Your search query is composed of:

• "donate" > by putting the word donate in " " it means only webpages that contain the exact word "donate" will be included in the results
• "organization name" > replace this with your exact org name, again in " ". As above, this will limit the results to pages that include your exact org name. If your org often uses an acronym, you might want to try the search again using the acronym instead.
• -site:https://www.organization.org > in a Google Search, the site operator limits results to pages within the domain that immediately follows. And the -site operator does the opposite: it will exclude pages from your own organization's website. Obviously replace "www.organization.org" with your own org's domain.

Most of the results you'll see in a search like this will be fine! Hopefully you'll see lots of other websites encouraging users to donate to your organization, and linking them to your donation page!

But amongst the results, you might find pages created by fundraising platforms that have scraped IRS data and et up pages without your consent. I ran this search for several causes I donate to, and found multiple examples of this.

I hope this helps you monitor who is out there on the web driving donations on your behalf.

As always, thoughts and feedback welcome.

Until next time ✨

— Ed Harris (your digital strategy guide)

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