This story for appeared in the Aug. 22 issue of The Hollywood Reporter magazine.
In 2009, producer Shauna Robertson was capping off a string of box-office hits that included The 40-Year-Old Virgin, Knocked Up and Superbad when she decided, at the age of 34, to leave behind her career as one of Hollywood’s most successful female producers.
“I wanted to have other chapters in my life,” she explains. “I was planning on just moving to Italy and doing a lot of yoga or something.”
Instead, Robertson and her then-boyfriend, now-husband, Edward Norton, launched CrowdRise — an innovative for-profit website that uses crowdsourcing to drive charitable fundraising — with two of her childhood friends, brothers Robert and Jeffrey Wolfe. The four envisioned a platform that could leverage the New York-based couple’s A-list Rolodexes and marry them with the ease of online giving. Celebrity fundraising campaigns would in turn promote the site to a wider community of users to do their own appeals. The result would be like an always-on Jerry Lewis telethon for the Twitter era. The initial investment was a couple of hundred thousand dollars and “28-hour-a-day workdays,” jokes Robertson.
Today, CrowdRise, with its mix of rib-tickling star-driven challenges (think Will Ferrell in a mankini, glistening with sunscreen, trawling for $19 donations to benefit Cancer for College), a user-friendly interface and millions in new funding, leads the way in a booming industry of crowd-sourced philanthropy. Since its 2010 launch, the site has hosted hundreds of thousands of campaigns and raised more than $150 million for nonprofits, with another $100 million anticipated by year’s end (numbers it has never previously released). In four short years, it has begun to rival the levels of giving by foundations. By early 2015, CrowdRise — which counts stars such as Olivia Wilde and Paul Rudd as campaigners and Judd Apatow as an investor — will have collected nearly two-thirds of the $400 million-plus distributed by Newman’s Own Foundation, long the gold standard for Hollywood-originated philanthropy. CharityBuzz, founded in 2005 and a top competitor on the online fundraising space, follows a different model, working with celebrities and companies on auctions of special experiences and items to top bidders. As of late last year, it had raised $100 million.
Overall, U.S. philanthropic giving is static, hovering at about $300 billion a year. But online donating is exploding, topping $20 billion in 2013 and growing 15 percent a year. “CrowdRise is a very interesting experiment,” says The Chronicle of Philanthropy‘s Cody Switzer. “It’s not the old relationship, where a nonprofit asked for money and someone gave it to them. It’s interesting to see this free-form peer-to-peer fundraising where people can pick their challenge without the organization overseeing every part of it. It could be disruptive to the way that we think about fundraising.”
What energizes Norton — an environmental activist whose father is a former director of The Nature Conservancy in China — is CrowdRise’s cost-effectiveness. “Nobody loves a gala dinner more than the Hollywood community, but it is one of the most inefficient ways of raising money,” says Norton, 44 and married to Robertson since 2012 (they have a 17-month-old son). “You throw a party and say, ‘We raised a million bucks tonight!’ But it cost you $400,000.”
By contrast, CrowdRise’s party takes place in the virtual world, where the only real costs are credit card fees. With each campaign, CrowdRise collects a small fee from the charity (about 3 to 5 percent, comparable with Kickstarter’s 5 percent fee; CharityBuzz takes 20 percent). “Most nonprofits average about 25 percent development costs, so they spend 25 cents of every dollar that they raise to raise the money,” says Norton.
The two-time Oscar nominee, who is expected to be in the awards-season mix this year for his role in Alejandro Gonzalez Inarritu’s upcoming dark comedy Birdman, enlists high-profile pals like Sean Penn to launch campaigns. (Penn’s J/P Haitian Relief Organization has raised $319,116 through CrowdRise.) Wilde, who raises money for Artists for Peace and Justice through the site, also participated in its Mozilla Firefox Challenge, whereby the company awarded a grant of $50,000 to the celebrity who raised the most money for his or her chosen cause. Wilde finished in eighth place, ahead of Seth Rogen (The Vampire Diaries‘ Ian Somerhalder came in first, with $123,800 raised for his environmental foundation). Rudd has used CrowdRise to generate funds for five charities, including one benefiting Children’s Mercy Hospital in his native Kansas City.
Robertson has forged relationships with a host of comedic superstars over the years, having worked early on with director Jay Roach (Meet the Parents) and later with Apatow. Robertson says busy celebs spark to the idea of being able to harvest money while on the go — no dressing up or posing on the carpet required. Considering that stars often demand amenities like first-class transportation to show up at a charity event, CrowdRise’s ability to create buzzy campaigns with low overhead (no highly paid development directors) can’t be underscored enough.
“I think more people in the social-change field are realizing that, if given the choice between a pure nonprofit model that requires constant donor cultivation versus a for-profit social enterprise that is self-sustaining, they would almost always choose the latter,” says Hollywood philanthropic adviser Greg Propper of Propper Daley.
Apatow regular Rogen has helped raise $442,000 for the Alzheimer’s Association via the site, lending his comedic talents to several pleas, like writing personalized poems in exchange for $20 donations. With every campaign, he is able to challenge his 2.2 million Twitter followers to join in. But the bulk of CrowdRise’s fundraising comes from the thousands of regular users who launch campaigns for any cause they deem worthy, then hit up their email contact lists. “People who have CrowdRise accounts use it like a Facebook account,” says Robertson, who works full time for CrowdRise and has no intention of returning to Hollywood. Businesses, too, like UTA, see it as a tool for incentivizing their staff. The talent agency, which is an investor (as are CAA and Brett Ratner), uses the site as a platform for its annual bowl-a-thon.
With its focus on charities, CrowdRise dominates in the burgeoning crowdsourced fund-raising world — though unlike, say, Kickstarter or Indiegogo, CrowdRise users can’t raise money for an indie film or wild invention. Newer outfits like Prizeo and Omaze have emerged that conduct online raffles. On Aug. 11, Omaze announced that its auction of a walk-on in J.J. Abrams‘ Star Wars: Episode VII had raised $4.26 million for UNICEF’s Innovation Labs. Such giants as eBay and Facebook have made inroads with eBay Giving Works and Facebook Causes.
Perhaps in response, CrowdRise — 60 percent of whose users are ages 18 to 35 — has expanded beyond 501(c)3 giving into the realm of crowdsourcing for individuals in need, like a family member with medical bills. The site posts a disclaimer: “Give to this project if you know this person and you know their story is true.” Norton and Robertson say nonprofits are vetted to ascertain they are in good standing as 501(c)3s.
“CrowdRise has been so effective because it is a fun, communal way to participate in philanthropy,” says Wilde. “That’s so important because young people may feel that philanthropy is for the older and richer and the ladies-who-lunch crowd. CrowdRise says: ‘No, this is for you. This is something for you and your friends.’ “
Perhaps most telling about CrowdRise’s reach and potential is venture capitalist Fred Wilson’s enthusiasm. The deep-pocketed investor, whose portfolio includes Twitter, recently led a $23 million VC round to help expand CrowdRise and its staff of 50 (mostly techies based in Detroit).
With that vote of confidence, Norton and Robertson could someday find themselves in the strange world of Silicon Alley IPOs, a blue-ribbon social entrepreneurship success story, counting their millions. “If we make a billion dollars, we would have had to have raised like hundreds of billions of dollars, and the world will be a different-looking place,” says Norton.
Norton and Robertson declined comment on whether CrowdRise is in the black or whether they draw salaries. But the two say they don’t have a problem making a profit, given the work they’ve put into it and the huge amount raised for good. And, “We’ve been doing it for free for so long,” adds Norton.
Apatow, ever the funnyman, says he will hold off on buying a yacht, though. “I felt a lot of pressure to invest, and I have no expectations for anything except losing all of the money,” he jokes. “It would be weird to make money on it, wouldn’t it? It’s charity, for God’s sake.”
Read more from THR’s philanthropy issue below.