Online Giving Marketplaces conference

Event Online Giving Marketplaces: Changing the Face of Philanthropy
Date 8 October 2008
Venue Stanford University, Stanford, USA
Organizer Stanford Social Innovation Review

In the heart of Silicon Valley – and in the midst of a global economic crisis – the Stanford Social Innovation Review drew an audience of nearly 250 philanthropists, non-profit managers and social entrepreneurs to participate in a day-long conference on the evolving world of online philanthropy. The conference brought together executives from 14 online giving sites, making it the largest-yet public gathering of leaders in internet-enabled philanthropy.

The conference began with an introduction from Lloyd Nimetz, co-founder and president of the online giving platform HelpArgentina. Employing a new method of audience engagement, Nimetz posed a set of questions to the audience which they were able to collectively answer in real-time via text messages (SMS). The – often mixed – results were displayed on the main screen. Nimetz’s culminating question, ‘Are donors on the supply or demand side of the online marketplaces?’ came out as a virtual tie. It was a reminder that there is not yet a consensus on whether online giving is just an incremental change in donation method or if it offers the possibility of fundamentally altering donor behaviour. That is, can online philanthropy help donors make decisions based on social impact? Or is it only a mechanism to reduce transaction costs? Either way, could that increase total giving?

In a panel led by Lucy Bernholz, founder and president of Blueprint Research & Design (and avid Philanthropy 2173 blogger), panellists argued that the largest challenge to giving websites is driving traffic to them. For social entrepreneurs interested in getting a slice of the online giving marketplace pie, this begs the question, ‘If I build it, will they come?’ In his presentation, Making Markets Work, Bill Meehan of McKinsey and the Stanford Graduate School of Business pointed out that online marketplaces account for significantly less that 1 per cent of charitable giving in the US, suggesting that the answer so far is: ‘If we build it, a few will come.’

Premal Shah, president of Kiva, argued that online platforms for giving (or, in Kiva’s case, loaning) should be addictive, which means that they must be easy and fun. Omidyar Network Partner Matt Halprin asserted that it is the responsibility of the marketplace manager to make sure both donors and non-profits trust each other.

There is obvious potential for online platforms to give donors access to good information to help them make better decisions. Hundreds of millions of dollars have already passed through such sites. The challenge over the next few years is to build something worthy of tens of billions of dollars of smarter philanthropy.

Jacob Harold is Philanthropy Program Officer at the Hewlett Foundation. Email jharold@hewlett.org

For more information
www.ssireview.org/onlinegiving