Daily-deal and coupon sites are the vogue at the moment–Groupon’s the one you’ll think of. But Philanthroper’s one that showcases new non-profits and gives you the chance to donate.
“By now, you’ve surely used a daily deal site like Groupon or Living Social. Philanthroper.com is a lot like them … and very much not,” according to a statement released with today’s launch of Philanthroper. Groupon and its ilk try to sell you something, despite the fact they also act to save you money–their trick is to channel your money to the particular firms who are advertising with them. Philanthroper, on the other hand, showcases “the story of a new non-profit every day along with the option to make a one-click donation.”
Founder Mark Wilson notes that he “wanted to modernize the world of donation to appeal to today’s internet culture,” where instant gratification and micropayments are king. The site’s also set it against a backdrop of modern society’s “charity burn-out” due to endless solicitations from orgs supporting causes ranging from social to scientific, medical to the arts. As a result, Wilson’s design for Philanthroper is “all about simplicity.”
The innovation here is that Philanthroper only lets you donate a single dollar, different from deals sites, online auctions, and even charities (and donationware!) that stipulate a minimum threshold of $10, $25, or more. The thinking here is that handing over a buck is as tempting as, say, handing over $1.99 for an iPhone game. Plus if you surf to Philanthroper out of habit, you could easily find yourself handing over $365 per year to 365 novel, carefully curated non-profits–in contrast to occasionally handing over $5 or $10 to just one or two causes like you may have before. In effect you’re becoming a 21st century version of a classic philanthropist.
Where’s the money? Philanthroper’s payment model extracts just 1% of the $1, and it doesn’t keep this–the money goes directly to its transaction partner, to pay for the privilege of processing the online payment directly from your bank account to the non-profit in question. The site notes that the industry norm is to extract 3% and up to 25% of the donation to cover running fees, but it’s managed to pull off something new by negotiating a fee of just 1 cent for each dollar donated from its transaction handler mPayy. Instead Philanthroper makes its own money the way pretty much everything else does online: By displaying ads to you.
In return for donations Philanthroper acts like a glossy magazine front-end for numerous not-for-profits, and you’ll get the warm inner glow of donating a small sum to one of the six categories of NFP they cover: Arts, education, animals, environment, human rights, and health. Think of it as a cross between the Million Dollar Homepage, and the “Causium” charity business model that software firm Atlassian has championed with much success–a system that also relied on micropayments to entice customers to donate to charity.
So first causium, then philanthropiium–both enabled by the low running fees that a net-based business and cash-transaction model can bring. What’s next in rethinking how we support non-business entities?
Disclosure: Founder Mark Wilson has been a colleague of several FastCompany.com employees, including the author of this piece, in the past.
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