GoFundMe is one of the most popular ways to raise money worldwide.
The crowdfunding company, which says $15billion has been raised on its site since 2010, is often used to help families and groups aftertragedy, but has also been used tosolicit donationsfor everything from wedding dresses to veterinary bills.
Last spring, after a 2-year-old Des Moines boy was struck in the head by stray gunfire, 382 donors combined to give nearly $14,000 for medical expenses.
Eugene Kiruhura, the senior pastor at Urbandale's Shalom Covenant Church, created a GoFundMe recently to benefit five Des Moines siblings whose mother died during childbirth in August and whose father died Dec. 31 in a car crash. As of Wednesday morning, more than $250,000 had been raised from about 4,000 donations.
More:Pastor raises tens of thousands for Des Moines children orphaned after icy car crash
Here are some facts about GoFundMe:
What is GoFundMe?
The San Diego-based company describes itself as the world's largest "social fundraising platform." Since 2010the company raisedmore than $15billion in donations from 120million donors.
In 2021 one donation was made every second and 1 in 3 fundraisers were started for someone else, according to the company.
How does it work?
Think of it as PayPal for a cause. It essentially is a secure way to collect and distribute electronic payments or donations. Users create campaigns to address a need. They seta goal, or how much they hope to raise, then describe why they need the moneythrough stories and photographs.
Kickstarter and Indiegogo are similar crowdfunding sites, but those sites usually host fundraisers for startup companies or projects.
How are donations solicited?
Campaigns start by sharinglinks among friends through email and other social-networking sites, according to the company.But they can quickly go viral. In the event of national tragedies, donors can go directly to GoFundMe to find campaigns and choose where to donate.
More:Could your Facebook fundraiser or GoFundMe land you a big tax bill? Here's what to know before you start one
How are donations collected and distributed?
Donations are routed through GoFundMepayment processors. They are typically released only to the named beneficiary. Sometimes donations willbe released to campaign organizers who have a direct, personal connection to the beneficiary.
Are donations capped?
No. Donations often exceed stated goals. In those cases, the campaign organizer can elect to continue receiving money.
Does GoFundMe get a cut?
Yes. GoFundMe is a for-profit company. On fundraisers for individuals or businesses it chargesa 2.9%payment-processing fee on each donation, along with 30 cents for every donation. That means if a campaign raised $1,000 through 10 donations of $100 each, GoFundMe would collect about $32.
Transaction fees are 2.2% plus the 30-cent fee per donation for fundraisers for charities.GoFundMe no longer charges a platform fee, so it is free for people to start a campaign. The company asks donors to leave a voluntary tip after making a donation.
So, GoFundMe profits from tragedies?
Yes. Its business model is built on the number of donations it processes. In 2016, the company projected revenues of $100 million and the company was valued at $600 million, the last year for which those figures were available, according to the San Diego Union-Tribune.
Do all fundraisers make money?
High-profile fundraisers often make news. But manyfizzle without coming close to their goals.The goal for thefundraiser made by the 2-year-old Des Moines shooting victim's familywas to make $100,000.
When two of the five men convicted in the shooting were sentenced in December Mai's grandmother Mary Dieng said the family was left unhoused in part because of medical bills related to his treatment.
Can GoFundMe be used forscams?
Certainly, there are reports of GoFundMe scams.One common method is for scammers to hijack existing pictures and stories and direct donations to their own sites.Otherssimply create fake sympathy campaigns.
In 2018 three New Jersey people were charged after an infamous GoFundMe campaign whichraised $400,000 after a couple claimed they wanted to raise money for a homeless veteran who gave them his last $20 when their car ran out of gas. Prosecutors said the couple spent the money on luxury goods and gambling and gave just $25,000 to the homeless man.
All three people pleaded guilty to federal or state charges stemming from the case.The money was refunded by the company.
How do I protect myself?
Stick to accounts verified by the company. They have been vetted and should be safe.
If you are suspicious about an account, contact the campaign organizer or contact GoFundMe directly.
Are funds guaranteed?
Yes. GoFundMe guarantees funds raised go to the victims and their families.
If the company, a law enforcement agency or a user finds campaigns are misused, donors are fully protected and will receive a refund. If a campaign organizer does not deliver funds to the intended recipient, GoFundMe will donate the undelivered amount to the right person.
Can GoFundMe freeze accounts?
Yes. If questions arise, the company will hold funds unless the beneficiary is verified.
How do I donate?
GoFundMe only accepts payments through credit cards, debit cards, PayPal and Apple Pay.
