How Much Should I Give When I’m Solicited For A Crowdfunding Campaign?

One of the phenomena in the fundraising space that has continued to gain traction in recent years is crowdfunding. In fact, crowdfunding was a large part of how I raised over $2 million in philanthropy before turning 24. According to Statista, crowdfunding in the United States this year has reached over $800 million and is expected to top $1 billion in a single year by 2018.

After crowdfunding for six years, teaching dozens of professionals and social entrepreneurs my best practices, and making my own contributions to dozens of campaigns, I realized that giving probably comes a little easier for me than it does for others. To answer the question, “how much should I give when I’m solicited for a crowdfunding campaign?”, I’ve outlined two questions that you should ask yourself before funding campaigns.

Do you believe in the person?

This is the most important question you need to address first. That’s because on the other side of the correspondence you’ve received is a person waiting to hear back from you. They’ve taken the first step of making themselves vulnerable by asking you for money to support their worthy mission. If you decide not to give anything, it is hard to expect the person on the other side to not take it personally. If you really don’t believe in the person or don’t want to preserve that relationship, then give them an excuse or don’t answer their messages. If you do believe in the person and care about the relationship, you should give at least $20. After analyzing almost 500 transactions from my last three fundraising campaigns, I found that roughly 30% of those transactions were for amounts of $20 - $25. In fact, it was the most common contribution amount regardless of the campaign goal and fundraising period. Each of the campaigns had goals of $10,000 - $50,000 and spanned from one month to three months in length. Simply put, giving at least $20 will at least put you with most other givers. The closer the person, the more you should consider giving.

Do you believe in the mission or the cause?

I always put this second because the person leading the organization and driving the mission matters more than the cause itself. Moreover, if you don’t have a tie to the person, you can always find an organization that already aligns with your beliefs. In line with the crowdfunding campaigns, if you’re an "education person" and generally support educational causes, you should consider giving more to campaigns that support education than others. Generally, if I care about the cause, I’d add at least $5 more dollars to my gift. If I really care about the mission or the organization, or I’ve given in previous years, I’d give up to a $1,000.

Going back to our question of “how much should I give?” The short answer is no less than $20. Most of the time when you’re being asked for money, people have a relative idea of how much you’re worth. Should that play a role in how much you give? Absolutely. A college student who gives $20 will mean so much more to the person raising money than a $20 gift from a working professional making $100k+ per year. Does this mean you should give money to every campaign that crosses your inbox or mail? Absolutely not.

If you’re unemployed or under the age of 18, you get a pass. If your household income exceeds $150k, you should consider making gifts of no less than $50 and aim for an average of $100. Not all relationships are created equally and it’s up to you to determine how meaningful they are. It is important to note, people who want to make gifts over $1,000 should not do this via web. Amounts of that size should be written directly to the organization and mailed or sent via wire transfer. It is cheaper to wire that money to the organization than it is to donate via web – assuming most wires are $15 - $30 and service fees are 3%.

Giving should be personal. Treat your giving as an opportunity to live out a part of your life that you don’t have time for. When I speak to social entrepreneurs, I typically use the car analogy. Their work is the vehicle. Your money is the gas or the fuel for their work. Both pieces are important to move from point A to point B. However, not all cars are created equal. As donors, we get to choose the cars that we like. Let the social entrepreneur or the organization compel us to contribute to their mission.

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About the Author: Karim Abouelnaga is the Founder and CEO of Practice Makes Perfect, a full-service summer school operator that uses a “near-peer” learning model to drive academic outcomes. Karim experienced the struggle to succeed in under-resourced urban public schools; lucky enough to benefit from nonprofits that provided him with great mentors, he received over $300,000 in scholarships to make his college education possible and is now working to make the college education experience he received possible for other economically disadvantaged children. Karim is a regular contributor for Entrepreneur and Forbes, is a Global Shaper, an Echoing Green Fellow and was named to Forbes' 30 under 30 in Education. In 2016, Richtopia ranked him in top 5 of most influential entrepreneurs in the world under 25. Karim graduated from Cornell University with a degree in Hotel Administration in 2013.