GoFundMe: How Online Crowdfunding Has Changed The Way We Give

When life takes a turn for the worst, more and more people are turning to GoFundMe.

The online fundraising platform allows people to lend a digital helping hand to those in need, hosting campaigns to raise money for things from medical expenses -- which make up a third of all donations -- to legal funds.

Now a crowdfunding juggernaut, GoFundMe is a far cry from rattling a tin on the sidewalk and featured on Forbe's 2016 list of next billion-dollar startups.

It's no surprise the technology is leaving its mark on the charity sector as a whole.

"It is the democratisation of philanthropy," Director of the Australian centre for philanthropy and non-profits studies at QUT, Associate Professor Wendy Scaife, told 10 daily.

"[It's] basically just opening up giving to a whole range of people in new ways and in ways that are quick and convenient and easy for mass outreach," she said.

And we know with giving, if it's made easy for people to give, then they respond.

Digital crowdfunding is a one-stop-shop kind of deal, Scaife said, where donors simply log on, choose their cause and easily part with their desired amount of money.

The interfaces are user-friendly and often advertising is achieved organically through social media.

Over more than two million personal campaigns, GoFundMe has raised over $5 billion from the pockets of 50 million donors.

The most successful campaign so far -- the Time's Up Legal Defense Fund --has raised USD$24,205,400 for victims of workplace sexual misconduct in the wake of the #MeToo movement.

Cutting Out The Middle Man

GoFundMe's numbers speak to their successes but that isn't to say traditional charity organisations are by any means dead and gone.

An estimated 14.9 million Australian adults gave more than $12 billion to charities and nonprofit organisations (NPOs) in 2015-16, according to Giving Australia 2016 reports.

But while our generosity remains, the traditional approach to reaching out to donors -- which often includes by phone or mail -- is much less likely to attract a donation compared to a decade ago.

A Salvation Army band plays Christmas Carols and collects donations in the Central Business District, Sydney. Image: AAP

"If we want to give to something traditionally then, of course, we would have gone through a recognised charity and they would direct our donation to the most important thing," Scaife explained.

But what crowdfunding does give us is shopping. This whole array, just like you're going to a supermarket. All of the things that we can actually help with. So this is a concern for the charity sector.

This disintermediation, or "cutting out the middle man", has made charity easier but charities less attractive -- and they're struggling to keep up.

Some 23 percent of NPOs didn't even have a website in 2016 and less than half of those who did report it wasn't optimised for use on mobiles.

Despite being slow to get online, charities can still benefit from their digital counterparts.

In 2018, 10-year-old Jack Berne reached out to the Aussie public for drought-stricken farmers with his 'Fiver for a Farmer' campaign, which brought in more than $700,000.

But the funds raised were to be handed over to two charities -- Drought Angels and Rural Aid -- who would distribute the cash to farmers, Jack's mother told 10 daily in September.

The Risk You Run

Though donating to a cause or individual struggle is seemingly easier than ever, the modern donor needs to be savvier about where they place their trust.

GoFundMe scams can bring in just as much compassion as the real deal.

READ MORE: GoFundMe 'Trump Wall' Campaign To Refund All Donors

READ MORE: GoFundMe Refunds More Than $400,000 After 'Fake Homeless Veteran Scam'

Late last year, the platform had to refund more than $400,000 back to 14,000 donors who gave money to help a homeless veteran in what prosecutors now say was a fake "good Samaritan" scam.

US authorities said three people teamed up to create a fake story, and GoFundMe campaign to match, for the man who supposedly gave a woman his last $20 when her car ran out of petrol.

The couple had allegedly met the man by chance in a casino and come up with the idea.

"It's very easy to touch the heart and unfortunately touch the wallet," Scaife said about the scams.

GoFundMe said the company has a dedicated team who work to protect both donors and campaign organisers.

"Campaigns with misuse are rare, making up less than one-tenth of one per cent of all campaigns," a spokesperson said in a statement to 10 daily.

"We also have a best-in-class trust and safety team in place who are committed to making sure funds are always delivered, safely to the intended recipient."