Research: The Impact of Small Donations on Crowdfunding Campaigns

In an era where philanthropy is just a click away, the question arises: Does giving still belong exclusively to the wealthy? Are large donations the driving force behind philanthropy in Israel, or do household donors play a more significant role? To shed light on these questions, our research team collaborated with the Institute of Law and Philanthropy at Tel Aviv University to create a groundbreaking report. This report provides current data on the scale and patterns of online donations in Israel, along with a crucial tip to help nonprofit organizations target the right audience.

The Phenomenon: Surging Growth in Online Donations in Israel

Since the establishment of the JGive platform in 2015, the number of donations and funds raised through online platforms has been steadily increasing. This growth surpasses the typical annual increment seen in traditional nonprofit fundraising, indicating the significant potential for online donations in Israel. Even during the challenging period of the COVID-19 pandemic, online donations continued to soar. In 2020 alone, over 300,000 donations totaling approximately NIS 76 million were made through JGive. What is driving this surge in online philanthropy, and what motivates donors to embrace this method of giving?

Reason #1
Embracing the Crowd

Online fundraising platforms offer nonprofit organizations extensive exposure to a diverse range of donors from various backgrounds and income levels. Collaborative recruitment methods, such as ambassador campaigns or giving circles, further expand this exposure. On our platform, we observe a consistent increase in the number of new donors each year, highlighting the fact that it's not just repeat donors but a constant influx of new donors who recognize the importance of involvement.

Reason #2
Transparency Matters

The rise in donor engagement can also be attributed to the transparency provided by online donation platforms. In the past, when donating through traditional methods like door-to-door collections or charity boxes, we had no visibility into who else was contributing or how our money was being utilized. Today, however, we can access all this information through the campaign pages of nonprofit organizations. We can see the number of people supporting the cause we care about and review the financial transparency indicators of each organization. This transparency instills confidence in donors, assuring them that their contributions are being put to good use.

The majority of donations received by nonprofit organizations fall within the range of NIS 100-500.

The Power of Small Donations:

Surprisingly, the majority of donations received by nonprofit organizations on the JGive platform fall within the relatively medium-low range of NIS 100-500. In fact, 59% of the donations received fall into this category. Our data indicates that nonprofits raising funds in smaller amounts tend to generate higher overall revenues. While the number of donors continues to increase each year, the donation amounts remain relatively stable. This suggests that contributions within this range are most suitable for many organizations. This pattern holds true across various nonprofits, as the bulk of donations tends to gravitate towards these lower amounts.

These findings highlight the fact that the collective impact of numerous small donations is significant. Though individually modest, these contributions amass to form substantial sums. It is precisely these donations that drive the system forward, akin to numerous small gears working together. The cumulative effect of these small donations ensures the stability of organizations and sustains their critical work. Furthermore, it is crucial to recognize that a donation symbolizes ideological support, and the broader the circle of donors, the stronger the legitimacy it implies.

Conclusion: Small Contributions Add Up to Big Numbers

The unequivocal insight that emerges from the report is that the number of online donations is a decisive factor in the ability of nonprofit organizations to grow. The power of online platforms lies in their ability to quickly and efficiently reach a large number of potential donors, enabling nonprofit organizations to increase the number and scope of donations they can raise. Additionally, digital platforms allow for the implementation of measurement tools for digital campaigns and the creation of long-term and cross-platform contact with the audience through emails, social media, and sponsored promotions.