Charity begins online
Published: October 14, 2004
Raising money for charity often costs money. Often a lot of money.
Receiving that money can cost even more. www.justgiving.com has found a way to get 100% of your money to charity without them going broke.
Justgiving.com is a rare internet business: it is a successful one. Not only did it weather the dot.com storm of the early millennium, it has also transformed the way charities raise finance
In the early nineties, technology companies said the internet would transform the global economy, forever changing the way we live our lives.
But then the technology bubble burst and with it went many thousands of internet companies.
Yet one small company from London, Justgiving.com, which was established at the peak of the boom, survived the bust and is now reaping the benefits.
“It was difficult at the beginning because we started just two months before the technology bubble burst,” explains Zarine Kharas, the company’s founder. “But by then we had already raised enough finance to keep us going and now our turnover is expanding at 600 per cent a year.”
Ms Kharas established Justgiving after leaving her job as a solicitor in the City of London. “I left because I wanted to give something back to society. I had the idea of Justgiving.com after looking at the charity sector in America. It wasn’t a Eureka moment.”
Justgiving.com is different to other IT services companies because it allows charities access to a fully managed online payment processing service without the need for them to invest heavily in IT. The technology allows charities to raise donations through their own websites for only a small monthly administration fee. This is a vital resource for many charities unable to afford their own expensive payment processing systems.
Justgiving also allows individuals who are embarking on a fun run or any other charitable enterprise to set up, free of charge, their own web page so they can collect sponsorship online - making the conventional clipboard and pen approach obsolete.
And here is the clever part. Justgiving’s systems automatically claims 28 per cent back on all donations from the Inland Revenue through the Government’s Gift Aid scheme.
This has the two-fold advantage of increasing the sums raised for the charities while relieving the administrative burden of processing Gift Aid applications - research had shown that most charities found it uneconomical to claim the benefit on donations of less than £25.
Charites never pay directly for Justgiving’s services and 100 per cent of the public’s donations go to the good causes. The company makes its money through a commission on the Gift Aid money it reclaims from the Inland Revenue.
“Since our launch, we have helped more than 850 charities raise almost £14 million, including £3 million in automatically reclaimed Gift Aid,” Ms Kharas says.
These figures and Justgiving’s innovative technology helped the company win The Charity Times’ prestigious Fundraising and IT services award.
“It was very valuable to receive such recognition from the charity sector,” Ms Kharas says. “It shows we are really helping charities to progress and raise more money.”
The company is building on its success by expanding into the United States.
“Giving to charity is part of the culture in the United States - each year individual donations total more than $270 billion. The market is so big we just had to be there.”
And the company’s ambition doesn’t stop there. “Only when everyone who has an e-mail account also has a Justgiving account will we be happy.”
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