Fundraising

It’s interesting to reflect on how fundraising has changed over the past four decades. The first recorded “walkathon” was in 1969, the CROP Hunger Walk in Bismarck, N.D. $25,000 was raised and the idea spread to other non-profit groups.

By the 1990’s the running for charity boom had a firm foothold in the U.S. There are event producers who make their living setting up races for charities, trade shows and technology vendors. Major charities have an in-house staff whose sole purpose is to organize events and recruit runners to their races. Team in Training (Leukemia Society) employs 350 full-time people who organize endurance events. In 2010 $1.65 billion was raised by non-profits through athletic events.

The question to ask is, “how much of the money raised by the participants goes towards prevention, finding a cure, treatment, etc.?” The average event takes .50cents of each dollar raised to cover costs. Other fund raising methods generally take .15-.20 cents. (direct mail costs .20, major gifts, .10-.18). The American Cancer Society does well with its’ Relay for Life, holding costs to .8cents for each dollar raised, but this is unusual. If a charity can get sponsors to pick up some of its costs, then more money goes towards the actual problem. Still, someone has to pay.

In 2010 there were 36,958 athletic fundraisers in the U.S. (from the “Run, Walk, Ride Fundraising Council”). If I tell people at work I am participating in a race, or working at a race, one of the first questions is, “what is the race for-meaning who am I raising money for?” It’s ingrained in the public’s mind that is the only reason to participate. If I answer, “I have no idea” or, to be really bad, “it’s not for a charity, it’s to see how fast you are or if I can finish” I am looked down upon. Why would I or how could I do an event just to see if I can finish or not know or care about the charity?

The Boston Marathon, supposedly a qualifying only race, increased its charity slots from 100 to 1,250, charging the non-profit group $350 for each slot. A legit qualifying runner pays around $130. They have more charities looking to get a slot than openings, despite the price. The NYC marathon collected $3.8 million in 2010 from charities, selling 7,400 slots for up to $950 apiece. But the fund-raising groups still figure they make out, because they charge the runner 2-5x that amount to enter. Some groups get aggressive in their suggested techniques. The Susan B. Komen foundation tells participants that if eating out, instead of leaving a tip, ask the waitress if you can use it as a donation and better yet, have her give up the entire day’s tips. Others say to make contact at least 3-6x with a potential donor, or tie a ribbon on your donor’s finger and not let them remove it until they made a donation.

If you are thinking of starting your own charity event, follow this general rule (scientific studies have looked into this): long distance events raise more than short ones, sponsors seem to give more money when they believe the event will be painful for their friend. Suffering seems to make the event more meaningful.

This article may make it seem like I am against running or biking for a charity, I’m not. If a race is a fundraiser for a charity, fine. But participants may want to take note of how much of what they raise actually goes towards real research, or directly help people. I also have absolutely no problem with an event organizer holding a race and none of the fee going to a charity. If I go to a baseball game, pay for parking, get a seat, watch a game, I don’t expect the team to give money to charity. If I race and my fee covers registration costs, bathrooms, police and ambulance, water/food, a safe course, timing, permits, and even a profit for the organizer who is trying to make a living, that’s fine too.

Reference: Smart Money, July 2011