Is Crowdrise a challenge to philanthropic best practices or the way of the future?

When The New York Times speaks, people pay attention. At least in the small part of the world we call philanthropy. The Grey Lady chose to feature an article about Crowdrise on page 3 – a virtual guarantee to be taken seriously by even the most cursory of readers. And if the number of retweets and TinyURL’s which I received of this article is any indication, it got the attention of lots of our colleagues.

For those who missed it, Crowdrise is a cross between a social networking site and an on-line giving portal. In its simplest form, you pick a cause, you tell your friends, they give – you are popular and your cause gets supported. Not bad. As with many other direct giving sites, it eliminates the middle – and the implicit overhead, the money gets where it is supposed to go quickly, and donors can feel virtuous and socially connected at the same time. The examples were impressive and some of the results even breathtaking. Surely a philanthropic approach not of the future but of today.

The question – is this good philanthropy? I confess being torn about this so here are some of my thoughts. I invite your reactions:

First a few concerns:

1. Charities can be listed by anyone without any verification. There is a tremendous amount of trust that your friends or friends of friends or their friends are legit. A Hollywood star lends his or her name and the cause gets viral legs [probably a mixed metaphor] and money comes floating in. All of the examples in the Times article were on the up and up, but without some verification, how easy or hard is it to pull a fast one?
2. Popularity rules. Ed Norton is a truly generous star and his motivations are clearly genuine. But does that automatically mean that what he supports has been shown to be effective? Does he entice giving because of his name and not because funders believe in the cause? Without his or a similar “name” would those same funders have funded this cause, or any other? Does it matter?
3. Charities which are supported are not truly accountable since the process of getting the money to them is largely removed from any assessment of the quality of their work or their outcomes.
4. Does this lead to better and more engaged givers or simply more “connections?”

Next, a few plaudits:

1. Philanthropy has become very guilt and burdensome for many in recent years. Demands for effectiveness, or outcomes, or metrics, or process have made many funders weary and hesitant. Philanthropy is not supposed to be just for fun, but there is nothing that says that it is inappropriate to take pleasure in the process of giving.
2. I have written elsewhere that just as the printing press democratized knowledge, the Internet has anarchized it. Perhaps this is simply the inevitable result of saying that all is fair in cyberspace, and it is fully up to the user to determine what is real and what isn’t. We are still learning how to mediate the onslaught of information which surfaces with every Google search; shouldn’t we be learning to use the same discipline with our philanthropic choices?
3. And in the meantime, lots of people are being enticed to give to lots of causes with lower overhead. And lots are realizing that they can take the lead in getting support for causes they care deeply about, again with little capital outlay.
4. If it truly becomes the in thing to give, to give regularly, to give generously, perhaps some of the attendant risks are worth it. A society of volunteers and donors is not a bad society – and at the end of the day, who are we to judge some else’s motivations for doing something good?

What is clear is that micro-giving is here to stay. And for all the discipline and best practices we teach in our courses, or advise in our philanthropy advising, it is not only filling a niche, but changing the face of how causes are identified, who feels comfortable giving to what, and how decisions are being made.

What is less clear is best practices. Those of us in the field would do well to devote ourselves to developing an appropriate ethic which can inform, educate, and add value to this mode of giving.

The practice is here to stay. It is up to us in the field to make sure that funders can know how to do it well. And responsibly. The Times article celebrates Crowdrise for its support of good causes; if we don’t do this well, we may well see those same crowds rise in disillusionment and disappointment.

Richard Marker serves as an advisor to foundations, independent funders, and not-for-profit organizations; he is a Senior Fellow in Philanthropy at NYU’s George Heyman Jr. Center for Philanthropy. Richard specializes in strategic philanthropy and planning and regularly blogs at Wise Philanthropy.