The online fundraising platform is increasing in popularity for teachers, school districts, PTAs/PTOs, and all kinds of booster clubs. Not only are organizations pressed for funds, but they’re also pressed for time. That extra funding is critical and your community needs it now.
As a busy working mom and former educator, I know that donating cash directly to the fundraising causes important to me is my preference. What I didn’t know was that by donating money to an online fundraiser or virtual fundraising event, a significant portion of my donation was actually applied to hidden fees from many of the most popular online fundraising platforms.
Part of figuring out how to fundraise online is finding the right tool. However, that takes a lot of time and effort. Even when you do have the time, sometimes it’s easy to overlook the fine print and just hit the button to launch your campaign—especially if it’s a brand you’ve seen online that has a good reputation.
In turn, donors are trusting that the entire amount of their donation will go to the cause they want to support. However, that isn’t often the case.
There’s only so much money to go around, and donors are making careful choices on where they want to put their funds. How would your donors feel if they knew as much as half of their contribution went to the fundraising platform and not your cause? How would that affect your next round of fundraising?
Finding hidden fees: Questions to ask about your online fundraising platform
Not all online fundraising platforms are equal, and it’s easy to get stuck with unexpected fees or see the actual amount of your donations slashed by unexpected fees. We’ve put together some simple ways you can make sure you know the majority of your donations will actually end up with your organization or cause, and not in the pocket of the platform you choose.
It’s important to remember that online fundraising platforms are businesses, and they do need to make a profit. However, some are more transparent than others. Here are five ways to help you make the best choice.
Know the difference between platform fee and payment processing fee. The platform fees go to the website you are donating money from. The processing fees are from whatever entity is taking your money from your virtual wallet and transferring it to the school organization’s virtual wallet.
Restaurant fundraising partners generally take 80% of the sales for the hours/day of the fundraiser. Pre-COVID would find teachers working a “Teacher Night” from 5 p.m. to 8 p.m. (after teaching all day), and a family of four would easily spend at least $30 on dinner (before the tip)—with $6 going to the school of their $30 spent.
Online or virtual fundraising platforms that say they don’t have a transaction fee are making their money somewhere. It may be that some donor, somewhere, has to give that 15% “voluntary” tip donation before the funds raised will be released to the people who organized the fundraiser.
Virtual or online fundraising platforms require fundraising goals to be met before they will release the funds—30% or more of fundraisers are never fully funded and the donation money does not reach the organization.
If a company is sending in a sales rep to generate student excitement about sales—the company is now paying for gas, mileage, salary, and benefits—and it’s coming from your donors at a rate of 25 to 50% of what you can raise.
Transparency is invaluable in fundraising. Look for platforms that share their monthly fee structure upfront. You deserve to see clear information and being able to easily see and understand the pricing is a great indicator of the transparency of the vendor you choose.