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Next-Generation Political Crowdfunding Platforms Reimagine Small Dollar Giving

BY Jessica McKenzie | Friday, March 13 2015

Pennies can add up. (Wikipedia)

At a Social Media Week event held at Civic Hall last month, Benjamin Yee, a former Democratic campaign fundraiser, asked a conference room full of people if they had ever donated money to a political campaign. Nearly everyone raised a hand. When asked if they felt it had ever made a difference: not a one. Even if someone does feel like they have been a part of something bigger—one of the many small donors who helped carry Barack Obama to victory, for example—that in no way means that the candidate you back knows why you contributed or what you hope they will do once in office. Money talks, but only if you have enough to get a phone call or an invite to a fundraising event. Everything else is just chatter.

Two new crowdfunding platforms, launched within weeks of each other, seek to use innovative approaches to counter the influence of big money in our political system. Jonathan Zucker of Democracy Engine and Joshua Tauberer of GovTrack launched the if.then.fund on February 3; Benjamin Yee's website ShiftSpark went live within the next two weeks. Both platforms want to reimagine the way Americans participate in the political process through campaign donations.

Unlike existing fundraising platforms that cater to small dollar donors like ActBlue, ShiftSpark and the if.then.fund make issues—not candidates—their priority. Campaign donations are merely the lever people using these platforms have to pull in order to wield any kind of influence. Both platforms also make possible protest donations to opponents when politicians fail or balk on an issue.

“Both of them have some interesting wrinkles and sophistications,” observed David Karpf, an assistant professor at George Washington University and the author of The MoveOn Effect, after hearing a short description of each platform. “They're either going to be great or novel but unused,” he added.

If This Then That

The if.then.fund is playing the long game.

“We're not interested in influencing votes,” Zucker tells techPresident. “We're interested in reshaping Congress.”

To do this, he and his co-founder Tauberer have built a platform through which people can reward representatives who vote one way on an issue and punish those who vote the “wrong” way by donating to their opponent in the next election cycle. Donors aren't asked to give their money to a particular candidate. Rather, their money is held until the vote has taken place and then is equally divided between those who vote for the bill or those who voted against, per the donors' initial choices.

if.then.fund

if.then.fund

To avoid running afoul of the Federal Election Commission, the if.then.fund shows how much has been spent on the issue in total but not how much is going to those who vote for and those who vote against. That information is only published, in aggregate, once the vote has taken place.

if.then.fund

if.then.fund

For example, right now the Senate is weighing whether to confirm Loretta Lynch as Attorney General. If.then.fund asks if you favor or oppose her confirmation, and then once a user responds, prompts them to donate $5 that will be evenly divided between the 100 Senate seats (which could include future candidates) depending on the votes.

This almost redefines the meaning of the phrase “small dollar donations.” Once an individual's donation has been split between all those who voted for something and future opponents of those who voted against (or vice versa), the donation per candidate could be as low as one cent.

“You can only vote where you live but federal legislation affects all of us,” says Zucker. “Even if you live in a place where your member votes the way you want them to, and most people live in a place where their representative doesn't always vote the way they want them to, you still care about the way other Senators vote.”

Zucker explains that if.then's method tries to approximate that of a lobbyist, someone who monitors bills relating to a specific issue, who informs companies or organizations or people invested in the issue (oil companies in environmental bills, for example): “Here is who is working in your favor and here is who is not; donate accordingly."

“We're giving people the ability to make that same kind of calculus as that lobbyist did,” Zucker adds.

“The reason this is really compelling to both of us is we're really trying to shift the balance of power, to let small dollar donors act in distributed but aggregated ways,” Tauberer tells techPresident.

Zucker and Tauberer have had the platform rigorously vetted by lawyers to make sure they follow campaign fund rules and cannot be accused of bribery. Besides, Tauberer points out, “How can a two-cent contribution actually be corrupting?”

ShiftSpark

The first thing to know about ShiftSpark is that donors decide when and if a political figure has earned a campaign contribution. Until they make their mind up one way or another the site, in essence, holds the donation in escrow, a carrot for the politicians. That is the other thing to know about ShiftSpark: it is not merely trying to crowdfund for campaigns; it is trying to crowd-lobby politicians.

Here's how it works: let's say there is an issue that people care about—mandatory vaccinations, for example. The issue is uploaded to the site. Users indicate whether they are for or against the issue. They are then prompted to choose who they want to influence from a list of politicians. They then commit to giving an amount of money to that politician's next campaign if the politician acts in the desired way. The donor chooses if and when the politician earns their campaign donation. If they decide to rescind it, the site will ask them if they would like to donate to an opponent instead.

ShiftSpark

ShiftSpark

Shiftspark

Is that a bribe? Or an illegal gratuity? (Here's a good explanation of both.) Yee says no. For one thing, he argues, the platform is not about votes.

In a follow up email after our in-person conversation, he writes:

First, ShiftSpark is about issues, not legislation. Second, the decision to transfer money is made by the individual users in a way that is not non-predefined. It is completely illegal to say "If you vote yes/no on this, then you will receive ____." However, it is the bedrock of our system (and completely legal) to be able to say "I care about ____, if you address that, I would support you.

Eventually, Yee envisions users uploading their own petitions for particular issues targeting specific people with influence in that area, like this one about mandatory vaccinations. Even with a smallish user base, Yee argues that in state and local elections ShiftSpark could have a real impact.

Populating People-Powered Platforms

The thing about small dollar donors is that you need a lot of them to make a difference. These platforms are new and both were rolled out without much fanfare. The challenge will be getting people to them.

Josh Tauberer and Jonathan Zucker probably have an advantage here, if only because Tauberer has a pop-up ad for the if.then.fund on his 10-year-old site GovTrack.us, which tracks U.S. legislation. That sends people who have shown, by visiting GovTrack, that they are already interested in engaging (passively, at least) with the legislative process to a site where they can engage a bit more actively. According to Compete.com, GovTrack.us gets roughly 300,000 monthly unique visitors.

Both of these projects are operating under the assumption that these platforms are for everyone. Tauberer says that in their marketing efforts “we will appeal to people who have never done this before. Choosing who to support in a campaign is really difficult. [The if.then.fund] makes things a lot easier.”

Zucker added that “a substantial segment” of the current donor base “will find this platform interesting.”

“We're not replacing existing modes of giving but creating at alternative,” he added.

David Karpf also stressed the importance of actively pursuing users, pointing out that people are not going to migrate to a new political site naturally.

Michael Malbin, the co-founder and executive director of the Campaign Finance Institute, identified another challenge entirely.

“The most direct appeal to get any donor to give is an appeal to that person's trust,” he tells techPresident. “It's personal. And when it's not personal it's going through some intermediary who's saying you can trust me that this is important.”

Malbin pointed out that the if.then.fund, for example, relies on a “complicated chain of thinking.” (Even Zucker used the word complicated when we spoke.) Getting a new user to trust something online that seems “complicated” will be a challenge for them.

Malbin also spoke to the importance of the nuts and bolts of platforms, citing ActBlue as an example fundraising site:

There are two fundamental problems that small donors have to overcome to give a contribution. One has to do with reducing the cost of giving, what people like to call friction...ActBlue has reduced the friction quite a bit and that's why they raise so much money, or help others raise so much money.

One way ActBlue has done this is by making it possible for users to save their information and in the future give with just one click. A fact sheet from the company boasts that they now have 1.8 million recurring donors.

Another has been to prioritize mobile giving (something Karpf also highlighted as an essential competitive move). As a result, mobile giving has increased by 49 percent.

Every Platform Has Its Limits

Even if ShiftSpark and the if.then.fund do everything right and have moderate success, can a new platform or two really level the playing field?

“The impetus sounds spot on,” says Karpf, “except that the thing that makes these platforms novel—being able to do small scale—actually probably runs at cross-purposes to the goal.”

In the best case scenario, Dave Karpf ominously predicts, “it's a bandaid over a gaping wound.”

Even in local races where the money involved in impacting a race or getting a politician's attention is lower, he points out, the level of public attention is also correspondingly lower.

“There are only a couple ways to change the world,” Joshua Tauberer says. “You can try to fix the rules or you can find ways to help people do things in new ways.”

“No one tool is going to solve the problem,” Jonathan Zucker adds, “[but] we're playing with the rules as they now stand.”