In Detroit Water Project, Tech-Driven Philanthropy Takes Off Without Touching Down
BY Denise Cheng | Friday, September 19 2014
When I first heard about Detroit Water Project (DWP), I was intrigued. And excited. I had lived in Michigan for two and a half years and it was a fellow Grand Rapidian who alerted me to the project. Donors looking to lend a hand to cash-strapped Detroiters could pay for their outstanding water bills; it is a type of philanthropy that allows people to see how their money directly helps, regardless of how little they give. It reminded me of Strike Debt’s Rolling Jubilee, where with even just a $5—no, $2—contribution, you could relieve many times that amount of debt for Americans who have fallen into default.
I was soon surprised to learn that neither of DWP’s cofounders, Tiffani Bell and Kristy Tillman, live in Detroit. Bell is a Code for America fellow based in San Francisco, and Tillman is the design director for a Boston startup that will launch in October. They have no volunteers on the ground. To community organizers, this is a counterintuitive way to start a grassroots project.
DWP’s proposition is simple, the framework is lightweight (and open source): Keep people from further falling into debt or catch them up on their water bills. Despite the lack of on-the-ground presence, DWP is very promising, its strength in its simple goal. It’s a Bandaid project to a “momentary crisis that is nationally outrageous,” Bell told me. Bandaid projects normally get a bad rep, but they don’t always deserve it, especially Bandaid projects that don’t pretend to be the solution.
“When people are strapped for money and money is really tight, there are always tradeoffs. And everything’s a choice. Either I get my prescription medicine, or I pay my water bill. I get food for my kids for school, or I pay my water bill,” Tillman said. “The first woman I talked to, she literally broke down and cried. And I didn’t really quite know what to say, but it’s almost always generally just relief.
Sometimes a community needs immediate and direct relief, not a multi-pronged approach to solving its long-term problems. By relieving people of their water debt—a $560 average outstanding balance—a great weight is lifted, and people feel again that things are manageable.
Community organizing is hard work, but plenty of grassroots efforts successfully bring together a community even if they lack the technology to match their on-the-ground efforts. DWP, on the other hand has a seamless, technical framework but this alone cannot overcome its lack of presence in Detroit. And it shows. In the first 10 days of launch, at least 23 national and local news outlets praised DWP, and currently the project’s donor-resident ratio is 8-to-1. DWP has relieved $130,000 of debt but there is more on reserve. My Grand Rapidian friend waited a month before being matched with a resident. By then, he had already spent the money he pledged because he also lives paycheck-to-paycheck. But he wanted to make good on his promise, so he donated and said that he’d deal.
DWP has a lot else to overcome: It faces a city with intervention fatigue. Americans regard Detroit with a mix of pity and reproach. Its majestic ruins makes for powerful blight porn: crumbling art deco architecture and houses smothered by vines. It is not uncommon for photographers to sneak into Michigan Central Station to capture the desolation of its once majestic corridors. These images, products of disaster tourism, has led to offer after offer from foundations, companies, academic institutions, civic do-gooders, and others who believe in their own innovative solutions to “fix” Detroit.
"Tiffani and I are highly aware and sensitive to the idea of paternalism in philanthropy and even in technology,” said Tillman. "It’s really hard to make things for other people when you don’t know those people. We’ve been talking about trying to get on the ground, but that’s something that Tiffani and I didn’t even consider at the beginning. It just wasn’t something we intended to do.” Tillman walked me through the thought process: "We’re paying water bills, and that’s what we’re going to do. Oh okay so we learned more about writing the software. Okay we have to talk to residents. Okay we amassed this kind of money. There is more to do. That came through a learning process; it didn’t come natural to us. We were building, iterating, learning, building iterating...and out of the hundredth rotation of that cycle we said, oh okay. We need people in Detroit."
Kiva is another organization with a strong technical framework. “On one hand, we’re a tech company, and we want to be scaling and achieving sustainability of our operations through economies of scale,” said Jonny Price, the director of Kiva Zip. "We want to support millions of small businesses here in America over the coming decade, and if you’re going to do that, you’ve got to really lower costs. Usually that means—for a tech company—reaching people who are more digitally included, technically literate. On the other hand, we have this mission that we are all about financial inclusion and reaching people who are currently underserved by the market.” Kiva backs five fellows in Detroit, who have strong ties to various communities on the ground.
And like DWP, Kiva sometimes juggles an imbalance between borrowers and lenders. Kiva perceives its two populations—borrowers and lenders—as supply and demand, respectively. It tries to keep its match rate at higher than 90%. Both DWP and Kiva have built well-oiled machines for nearly perpetual donor recruitment; through social networks, donors recruit other donors through tweets, social media recommendations, and more. Both Kiva and DWP have donation rates that any crowdfinancing group would envy. And when Kiva has a deficit of supply—a deficit of borrowers—it provides eager lenders with two alternatives: donate to Kiva’s general operational fund or to the general reserve. With the first option, the money will enable greater outreach to borrowers. With the second, once lenders repopulate the site, your funds will be deployed. By devising a few general pools, Kiva manages to capture and sustain donor momentum.
But unlike Kiva, DWP is not a nonprofit or any other type of legal entity. None of its donors’ pledges have ever passed through company hands; when DWP matches donors with residents, donors access bills on the Detroit Water Department site by entering a water bill account number. “Our advantage comes from the fact that we don’t have the same encumbrances as other organizations do. We don’t have the money on hand, and that’s a very on-purpose thing, too,” said Bell, who said that other crowdfunding projects that use more involved platforms like Indiegogo, have not scaled as well.
DWP’s ground support has been unofficial. Although the mayor of Detroit set up a water fund, backed by General Motors, Ford, and United Way, there are murmurs that the sewage and water department has also been steering its customers toward DWP. Its most prominent advocate is the United Way for Southeastern Michigan. When asked about why there has not been more local partnerships, Bell explained that “there was a desire [among others] to own the story whereas we came at it from an egoless standpoint, basically. That kind of didn’t work out with local groups. They had their own agendas, of course...payment plans, and passing out water, stuff like that. But for us, we wanted to either prevent someone from getting their water turned off or catch them up on their bill.” Bell acknowledged that they "didn’t really have intentions on relying on social media for the [residents], mostly because I know that most people who need help are probably at work, they’re not sitting on a computer all day. It’s just not realistic for the demographic.”
In the absence of on-the-ground presence, DWP recently mailed 800 postcards (with no operational funds, the postcards were a $175 out-of-pocket expense, and 400 postcards were donated by the printing company), but it has a lot more work to do to reach residents in need. The lack of a grassroots presence has hamstrung DWP, but so has the lack of personnel. The team has not had time to design a flier template for those who want to help spread the word on the ground. One Detroit woman who had been asking for a flier template to print eventually decided to make her own fliers. The team has not had time to engage residents to spread the word. DWP could use help “surfacing more people that need help,” Bell said. "Going door-to-door, checking conditions when someone applies for help. Being in certain places and handing out fliers, working with people to actually get them signed up. Especially with populations that don’t have access to the Internet.”
While DWP's decision to build its own crowdfunding framework has been very effective, one mistake that budding organizations often make is their scorn for spending donor money on operations. Through exposés of how big nonprofits spend their money on their staff rather than those they intend to help, media has shown how operational funds can be misused. In the midst of a disaster, we both praise and reproach groups like Red Cross, who have a ready aid infrastructure, but question how much actually goes to those in need. Misuse of operational funds exists, but the general public tends to confuse capital with impact, and operations with bloat. People want to brag that 100% of the proceeds go to victims. But imagine if there was an option to donate to a general fund that would pay for print materials, workshop supplies or refreshments at community centers that volunteer to help members sign up. Donors could pay for volunteers’ mobile phone bills when call volume skyrockets because of effective outreach and increased interest from potential participants. Money could go to on-the-ground volunteers, perhaps residents themselves, who don’t have the luxury to absorb their outreach expenses. And if DWP cannot handle the money itself, imagine if it partnered with a community-based organization to collect and distribute those funds.
"I think a big issue is trust, actually. Especially in a city like Detroit which has been really struggling economically,” Price said. "Probably a lot of people that have had people let them down, and things go wrong, and trust is probably a big issue.”
Bell plans to visit Detroit once her Code for America fellowship ends. DWP’s donors have shown great patience; some unmatched donors have emailed the DWP team to ask if the project is still going and reaffirm their commitment. The project has also attracted donors from around the world. Intense publicity sparked DWP’s donor momentum but contributions have continued to flow despite the media’s fading interest in the project. And even if DWP is a Bandaid project, Detroit’s water crisis is not an overnight problem.
Denise Cheng (@hiDenise) is an independent researcher affiliated with the MIT Center for Civic Media who examines the future of work. In past lives, she was a Peace Corps volunteer, a digital media educator, cofounder of a citizen journalism startup, civic media activist, and was highly involved in the hyperlocal, entrepreneurial journalism world.