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January 2008

What to do after the Fundraisers' Honeymoon is over

Do you remember the New Fundraiser's Honeymoon?

It's such a beautiful, special time, when you're bowled over by the cause you're working for, so amazed that you're getting paid to do something so cool. You think: This job is going to be a cakewalk. Once people know our story, they'll fall all over themselves to give!

You then start to "tell everyone" your story.

Some time after that, the honeymoon comes to a crashing end. You discover the harsh truth: People can know your story perfectly -- and still not care enough to do anything about it.

Here's the problem with the belief that all you need to do is get the word out: It's self-centered thinking. And centering on self, you miss three important factors:

  1. Even when you tell your story, you have a lot less of their attention than you think you do. Americans are exposed to something like 1,500 marketing messages every day. Many of these messages are exquisitely crafted and well targeted. No matter how cool your story is, it's one voice in a very loud, very crowded place.
  2. Not everyone cares about everything. In fact, a pretty large segment of the population doesn't care about much of anything. And many caring, active people have well-defined areas of interest, and are just not so interested in things outside of that area.
  3. Most important: It's not your story that's going to motivate people to give. It's their story. Sure, your work is really great. Heroic, even. But it's not how heroic you are that causes people to give, but how heroic they are.

If you're still in the Honeymoon, enjoy it. But as you get on with the rest of your life, dealing with reality as it is (not how you want it to be) is a great place to start!

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Carnival of Nonprofit Consultants

The Carnival of Nonprofit Consultants for this week is up, at Nonprofit Leadership 601.

When helping goes bad

From The Onion:

Child Bankrupts Make-A-Wish Foundation With Wish For Unlimited Wishes

Look out for those kids! They're fiendishly clever, and they'll get you every time.

Stupid nonprofit ads gone wild

(Or view it at YouTube here.)

The spot is for The Samaritans, a UK help line. What's it "about"? Well, I didn't know either, until I went to the blog of the ad agency that made the spot, where I found out (in the comments, not the original post) ...

... we've used the visuals that represent sound to convey the mindset of a potential Samaritans caller.... In basic terms, it's 50 seconds of someone's negative emotions followed by a challenge (Could you listen to this?) and a call to action.

Nice. So let's see if I have this right:

Someone sees the spot. Bowled over by the visuals, they run to YouTube see it again. They manage to find it. Then they find the blog of the agency that produced the spot. Scrolling down through the comments, they find out that it's meant to recruit volunteers. The abstract moodiness of the whole thing impresses them so much, they decided to ring up the Samaritans to volunteer. Fortunately, they're already watching it online, so they can pause it and get the phone number, which is on screen for exactly two seconds. (Why do I have this strange suspicion that nobody answers the phone, or that you just hear Morse code or a ticking clock?)

Likely, huh?

Alternative explanation: British people are better conceptual and abstract thinkers than Yanks. What may seem a total conundrum to thick Americans is crystal clear and highly compelling to UK viewers. In fact, Brits don't respond to being told what the call to action is. You have to approach them in a highly roundabout way. (Don't laugh; I've heard that one before.)

I was thinking if you wanted people to volunteer at a helpline, you'd remind them how good it feels to help others and -- I don't know -- maybe help overcome some of the common objections to volunteer work. You also might give the phone number a little more than two seconds, maybe even offer on online way to respond. But what do I know?

I just hope The Samaritans didn't pay for this work. And I hope a few more nonprofits will be warned about the advertising snake-oil salesmen out there trying to win awards on your dime.

This post is part of a popular ongoing series, which also includes:

(If you're amused or puzzled by this topic, you also may be interested in Why advertising is so bad.)

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Focus groups shoot down the good stuff

Here's a wicked parody of the useless information you can get from focus groups:

(Or view here.)

If you've watched a focus group at work, you've seen this happen.

Don't say you weren't warned!

(Next week: more videos to make fundraisers laugh.)

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Direct mail: news of its death may be premature

Oh my. Not again.

This time it's The Chronicle of Philanthropy's Give & Take blog, asking, Is Direct Mail Dead?.

Seems everyone is ready to hold Direct Mail's funeral. But let's get real: Direct Mail is not dead! It's not even terribly sick. (It may have a bad cold, achy joints, and a little trouble seeing -- but that's not terminal.)

There's no question that direct mail faces profound changes, but it's still the biggest fundraising medium around. By a long shot. But ...

Online is coming up behind it. Fast. Nearly every nonprofit fundraiser is now raising meaningful amounts of money online. Even if they aren't trying very hard.

So you need to be thinking ahead. As a response medium, direct mail is losing ground to online. That change is likely to accelerate in the coming years. If you aren't getting good at raising money online now, you may find yourself suddenly in a world of hurt in the not-too-distant future.

But even in the most online-centric future possible, there will still be a role for direct mail.

Rather than talk about Direct Mail like it's already deader than a doornail, we're better off dreaming about how we can add to the ways we motivate donors. Experiment, innovate, test.

As usual, a more constructive look at the issue comes from Seth Godin, at I gave at the office. He's worried about the larger nonprofits -- the ones that have done the most with direct mail:

I despair for most of the top 50 non-profits in the US. These are the big guys, and they're stuck. Unlike the Fortune 100, not known for being cutting edge in themselves, the top charities rarely change... if you're big, you're used to being big and you expect to stay big. That means that generation after generation of staff has been hired to keep doing what's working. Big risks and crazy schemes are certainly frowned upon.

Let's hear it for crazy schemes.

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Cranky or cool, fundraisers are like family members

I like this: The Nonprofit Marketing Guide blog compares nonprofit fundraisers to various holiday giving styles in families and how these personality types play out in the way they interact with donors: Nonprofit marketing as gift giving: which gifter are you?

Here's one of them, the "Cranky Old Grandpa" ...

These are the nonprofit staff who are bitter that they have to ask for donations and help at all. If people don't understand their issues and support their work, it's not the nonprofit's fault -- it's because the audience is full of selfish idiots. In other words, nonprofit marketing is a waste of precious time they need to spend on real work, so why bother?

Don't miss this. There's also the Cranky Old Grandma, Your Older Brother, Mom and Dad, and the Cool Aunt.

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You can't control the conversation

So what is this "Web 2.0 conversation" we keep hearing about? Interesting answer at Beyond Madison Avenue, in The Real Digital Revolution:

All the noise you hear ... about "conversations" is often just a fancy term for people sharing objective opinions of products on review sites, blogs and other digital media. The "conversation" is when the marketer responds to criticism with a pledge to try harder or some such.... But enough "conversations" about how bad your product is, no amount of clever advertising or radical media placement is going to save it.

It doesn't matter what the brand is trying to say about a company; the customers have their own say about it. And customers will believe other customers more than they believe the marketing.

It's only a matter of time before nonprofits start getting the same treatment of being rated, commented on, and critiqued in public by donors. (I've seen a couple of sites that make a run at doing this, but none that really make it count; if you know of any, tell me about it!) If you're ready for this, it'll be good. If not, ouch.

Here's what to do:

  1. Pay a lot of attention to your donor experience. What does it feel like to donate to your organization? Do they get acknowledged promptly? Do they learn about the impact of their giving? Do they get choices about what their money does and how you'll communicate with them?
  2. Make sure what you do is really, really cool. That's partly a matter of describing what you do in a way that wins hearts and minds. It's doing something nobody else does, or doing it in a better way. Or doing it in a way that more closely involves donors.
  3. Don't have a scandal. That's right, just take that scandal right off your calendar. It will follow you around for a looooong time if it happens.

Attempts to force-fed them your "brand standards" are meaningless at best. (At worst, they'll just remind donors why they don't trust you.)

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Oddly Precise Nonprofit Predictions for 2008


Here's my column in this month's FundRaising Success magazine, Oddly Precise Nonprofit Predictions for 2008. Teaser: Your organization will decide to issue an RFP for your general marketing needs. Unfortunately, so many people will be involved it will end up an impenetrable maze of vague philosophical rambling, wishful thinking and outright lies.

One more reason to be mad at United Way, or not?

When nonprofits forge partnerships with corporations, they sometimes come in for criticism for the real or imagined misdeeds of those partners. As in this recent editorial in the Christian Science Monitor: How a charity can hurt its cause. It's about the United Way's Pennies for Change, which allows people to donate one cent for each credit card transaction they make with card issuers that are in the program.

A penny here, a penny there, and pretty soon you're in real money. But according to the editorial, it's much more sinister than that:

... it could also undermine the United Way's longstanding commitment to supporting financial literacy for consumers. And it might buy the credit-card companies some desperately needed whitewashing at a time when Congress is looking hard at the industry.

Really, now. I'm no fan of the credit card industry, but if nonprofits can build partnerships only with morally pure, politically correct companies, they're going to find the list of eligible partners pretty short. Not all of the credit card companies are equally predatory, and very few of them actually break the law. I'll guess that the credit card companies that join the United Way program are generally the better corporate citizens, while the real bad actors are not interested.

You don't want to end up yoked with Enron-type corporate partners, but it doesn't do anyone good to be paranoid about corporate motives

I do have a quibble with Pennies for Change: It's the small-amount, low-impact, low-involvement nature of it. Donors who choose to give one penny per transaction to a broad and undefined cause just aren't diving into the world of good deeds.

Fundraising is so much better when it works to connect with donors at the heart and head level, motivating them to give to something they understand and care about. That kind of involvement is worth so much more than just money; it doesn't just fund projects -- it transforms donors, makes society stronger, and it raises more money.

Don't get me wrong -- anything that honestly raises money for good causes is worthwhile in my book. If United Way raises more money to do more good things through this program, more power to them.

I wish they'd create programs that collect supporters, not just pennies. But it's not fair to browbeat them for having corporate partners.

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Fewer donors: more revenue, or less?

In its Index of National Fundraising Performance, the Target Analysis Group reports on the third quarter of last year: Big picture, there was a small increase in revenue and a slight drop in the number of donors.

How so? The difference was made up by the larger amounts donors are giving. That's been the trend for a few years now: Lower response, higher average gift -- with the increase in gift size more than offsetting the drop in response to create ongoing revenue growth. (This is generally true for most of our Merkle clients too.)

Is there a breaking point? Target is afraid so:

... if current trends continue, at some point increases in revenue per donor may not sustain overall net revenue growth. With the slowing of revenue growth over the past three quarters, depending on the reasons for the donor declines, this could be a cause for concern.

Blame the Boomers. They're starting to show up on the lists. It's not so much that the average age of donors is dropping as it's the average age of Boomers is rising.

And these folks don't act just like the older generation. Yes, they're less responsive to direct mail, and they tend to give larger gifts. They're also more cynical, more demanding, and more selective.

You can duck and cover while the direct mail house collapses around you, or you can get in front of the problem:

  • Be less dependent on direct mail. Average gifts from radio, TV, and online are all significantly higher than direct mail average gifts. The average age is also lower -- you're talking more to Boomers.
  • Be proactive about seeking Boomer donors. Create offers and approaches that cater to Boomer needs.

More on reaching Boomer donors here.

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What to do with disaster-motivated donors

One way or another, nearly all nonprofits were deeply impacted by the Indian Ocean Tsunami of December 2004 and Hurricane Katrina of August 2005.

One of those impacts was the large influx of donors that responded to those disasters. The Chronicle of Philanthropy looks at the impact of disaster-motivated donors in Cultivating Loyalty After a Disaster (subscription required). It's worth a look.

The problem with disaster donors is their lower renewal level than "normal" donors. This shouldn't surprise us; these donors are often folks unmoved by the normal need for charity. But when they show up in huge numbers on an organization's donorbase, they can cause a lot of confusion.

Here's what to do next time you get a lot of disaster donors:

  • Report back. Keep them informed how their response to the disaster made a difference. This alone will make you stand out from most nonprofits.
  • Don't change the subject. They gave because they cared about the disaster. Don't immediately start talking about other things -- even though other things may be the core of your mission. Instead, transition over time to other things. Put the rest of your mission in context with the disaster for them.
  • Go easy on the ask amounts. It's normally smart to ask donors amounts that are around the amount they first gave. But in disaster situations, the abnormally high average gifts you get are probably just that: abnormal. Create scaled-back ask algorithms for these donors.
  • Cut your losses. At some point, you're throwing good money after bad to keep trying to renew disaster donors. Watch results closely, and when they drop off significantly, stop wasting your money.

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Is your fundraising a long, dull conversation?

Good post at Copyblogger: Why Great Copy is a Conversation, Not a Soliloquy. It raises the picture of "that guy" who corners you and then talks non-stop about himself, leaving you somewhere between bored and ticked off ... and how am lot of marketing (and fundraising, I should add) is like that guy.

... they breathlessly expound about the company's offering without actually addressing what's in it for the customer.... as a company insider it's easy to get caught up in the bells and whistles of a new product. Just remember: Your customers don't always care about what matters to you.

Fundraising that focuses on the organization really is that guy. Just as the secret of good conversation is to talk about the other person (you can learn a lot when you get them talking), the secret to good marketing is to talk about the other.

Fundraisers are fond of talking about themselves because their organizations have spent great effort being good at what they do. Why not tell everyone about that? they must figure.

But just remember, it doesn't work. Talk to the donor about the donor. The only things you say about yourself are the things that show how you fit into their world.

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Seven steps to a relevant fundraising offer

Relevance is the secret to fundraising. That's all. If your message fits in with your donor's life, the chance that she'll give is very high.

But it's not easy to be relevant. There's a gap in understanding between you and your donor. You are an expert in your field, she is not.

The place where being relevant matters most is your offer -- the specific thing you're asking the donor to do. A relevant fundraising offer has six elements:

1. Problem or opportunity
Present the donor with a specific situation that demands a response. The general, big-picture need for what your organization does will not accomplish this.

2. Solution
Help the donor see that her money does something real, that her gift translates to a solution to the problem.

3. Cost
You need to connect the problem and situation to her pocketbook. The donor's part in the solution should feel meaningful. Ask for amounts that are in the neighborhood of the donor's previous giving.

4. Urgency
You need specific reasons for the donor not to delay her response. If a donor puts the decision aside for later, the chance of it happening drops dramatically. Give a meaningful deadline. And make it clear that there are negative consequences of failure to act.

5. Context
A good fundraising offer does not require special knowledge to understand. You should be able to write your offer in one sentence. Avoid professional jargon and solutions that are not closely connected to problems.

6. Donor benefits
You should make it very clear to your donor that something good will come back to her as a result of her giving, such as:

  • Giving will make it possible for us to continue to serve you, or serve others like you.
  • Giving will help make the world or our community a better place.
  • Giving will fulfill a religious or social obligation.
  • Giving will make you feel good.
  • Giving is tax deductible.

7. Emotion
The case for any fundraising offer needs to be visceral and emotional -- with facts that back it up. You can't educate a donor into giving. Having an air-tight rational case for your offer will get you nowhere -- until you can bring a tear to the donor's eye.

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Put donors first for great fundraising

In the commercial world, smart companies are thinking about their customers' experiences. Think the iPhone. Think Starbucks. They go beyond the mere utility of what they sell to something less tangible, more exciting. And they're making a ton of money doing it.

A Beautiful Experience challenges nonprofits to think this way at Breaking new ground for non-profits and donor experience management:

... put your donors at the middle of your planning process and create an experience for them that creates meaning in their lives. It's a shift in thinking that the world's most powerful brands have already adopted. It might be time that you took a look at it as well.

I'm trying to imagine what it would look like if a nonprofit put donors in the middle if their thinking. For some reason, all I can see is a mountain of revenue funding more good deeds than ever.

The organizations that pull this off -- putting donors in the middle -- will experience skyrocketing growth.

Throw off the tired belief that your mission and your donors are somehow at odds! Embrace your donors.

Raising money the old way (mass-market, low relevance, one-to-many direct mail) is getting harder and harder to do. The future lies with those who serve the donors.

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Fundraising: Is the outlook good or gloomy?

Chicken Little, it seems, is alive and well at MSNBC, with an article titled Donor drain: As mistrust grows, loyalty goes. See what I mean:

Raising money for a cause these days has become much like trying to walk up a "down" escalator while it is accelerating. It's getting tougher just to break even and much easier to fall behind.

Alarmism aside, there is something afoot, and fundraising is getting harder to do in many ways. And I think I know the two main causes:

  1. The number of nonprofits is exploding. The number of potential competitors grows by thousands every year. Many of them are you direct competitors -- with the huge advantage that they're small, nimble, and have a tight focus.
  2. We're seeing the beginning of a dramatic demographic shift -- with the current generation of donors being "replaced" by Boomers. Boomers, who are generally less responsive to direct mail, more cynical, and more demanding. The basic assumptions about what motivate people to give are changing.

But I'm not worried. Not very much, anyway.

  • The organizations I work with will be able to make the leap from the old to the new style of fundraising. They're smart (hey, they hired us, didn't they?), disciplined, and determined. They'll innovate, test, and learn their way to success in the changing environment.
  • The fat part of the Boomer bulge is still a few years away from donor age. When those born in the mid 50s mature into their donors years, we're going to have the largest population of donors in history. And those who know how to reach them (see above) will reap unbelievable benefits.

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How to build a better brand

Need more from your brand? Here are some thoughts from Online Spin: 10 Principles To Inspire Your Brand (And Maybe Save It). People are demanding more from the brands they interact with:

People now are smarter, less forgiving and expect brands to rise to a higher standard. For most companies, this is far from where they stand today.

The ten principles:

  1. Transparency
  2. Authenticity
  3. Humility
  4. Simplicity
  5. Inspiring
  6. Personality
  7. Stories
  8. Consistency
  9. Flexibility
  10. Receptivity

(Read the article. The explanations are worth the visit.)

Note that words like bold, innovative, and cutting-edge aren't on this list. Instead, these are relational words. Because a good brand isn't' about how cool you are, but about how well you fit in to your donors' lives. The things that make a good friend are often the things that make a good brand.

Thanks to Seachange Strategies for the tip.

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Winning fonts in fundraising

There's a fun post at the Happydonors blog: The marvels of Courier.

Seems in repeated direct-response tests over time in all kinds of situations and with all kinds of audiences, the venerable font Courier pulls more response than other fonts. Even when the audience was teenagers ...

High-school students who'd never used a typewriter, perhaps never seen a typewritten letter. In a font-only test, Courier won again.

That warms my heart, as I think Courier is a truly noble font. But it doesn't quite match my own testing experience: When I've tested Courier against another font (usually something in the Times family or similar) I've seen no statistically significant difference.

The most sure-fire way to lose a font test in direct response (talking print, now) is to use a sans-serif font -- the type generally preferred by
Brand Shamans. They're hard to read, so it's little surprise they usually generate less response than the more readable fonts.

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Help for successful email campaigns

Some helpful hints for successful emailing from the Silverpop newsletter: Email Resolutions for 2008. They are:

  • Focus on the first few inches. (Many folks look at their messages in a preview pane before deciding what to do with them. Make sure you've got something in that small space that will keep them going.)
  • Let customer actions guide your campaigns. (If you do direct mail, this isn't a strange concept. Oddly enough, though, many email campaigns are conducted with little or no attention to recipients' behavior.)
  • Take a new approach to list growth. Ask! (Make it easy, fun, and worthwhile for people to join your list.)
  • Grab 'em in 60-seconds. (That's about how much time you have. Less, actually.)

Thanks to BeRelevant for the tip.

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What happens when you get caught with your ethics down

You may have heard by now what Holden Karnofsky, co-founder of GiveWell, did. In various places, often anonymously, he praised GiveWell and even knocked other nonprofit organizations. When he did so at MetaFilter, a large online community, he got caught.

What followed was not pretty. If you dare, you can read what the enraged community at MetaFilter had to say about Holden, his education, his morals, his intelligence, and pretty much everything else about him and his organization here.

(GiveWell is an organization that seeks to hold nonprofits responsible for getting results, and loudly proclaims a belief in "transparency" -- one reason the backlash against Holden is so rancorous.)

To his credit, Holden quickly apologized at the GiveWell Blog: I had a lapse in judgment, did a horrible thing, and I apologize. For the most part, the folks at MetaFilter are not buying the apology. (It probably didn't help that Holden showed up at their site and offered to give them money to set things right.)

Even though you might be able to do what Holden did and get away with it, don't do it. It's unethical.

And if that isn't enough to persuade you, just take a look at the savage treatment Holden, GiveWell, and anything connected to them have received in the past few days. It's probably safe to say that the reputations of Holden and GiveWell are meaningfully and perhaps permanently damaged. It's hard enough to raise funds without getting stuck with baggage like that.

The Net is a great tool, but you've got to use it right!

Another thought: If you're very young and in the profession for the first time, get adult supervision. Really, a lot of this looks to me like the work of a zealous youngster who believed he was smarter than everyone else. A few years having to work with older, more seasoned folks might have imparted some wisdom.

More commentary on this case at The Agitator, Gift Hub, and Give and Take. I blogged about GiveWell last March -- GiveWell: another front opens in the donor revolution -- and I ranted at Holden last October: When charitable giving is no good.

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How many donors do you need?

What's better: Lots of small donors, or a small number of large donors. The 's the question Don't Tell the Donor asks in The difference between philanthropy and fundraising. The Raiser's Razor chipped in on the subject with Would you rather have one $100,000 donor or 2,000 $50 donors?

I'll come down solidly on the "two thousand $50 donors" side.

Sure, having thousands of donors is a pain in the butt. You have to be available to them. You have to think about them, and learn to think like them. Just opening all the envelopes and cashing their checks is a big job that takes some real doing to get right.

One huge donor might be easier logistically, but he can decide to use his power to jerk your organization around. Or he can suddenly go away, leaving you in the lurch. (If you're getting a lot of government funding, you face the same dangers; sooner or later the "bad guys" are going to win an election, and you're going to face a dramatically changed funding landscape.) You're going to lose a certain percentage of your thousands of smaller donors every year. But not all of them.

From among a large number of smaller donors will rise a few larger donors -- a thousand bucks here, ten thousand there ... pretty soon you're into serious money.

A body of donors will be able to support you in non-financial ways, advocating for you or your cause, spreading priceless word-of-mouth, prayer if you're a religious organization. Donors are people who are voting for you with their checkbooks. That means a lot to them, and they'll tend to protect their investment.

Charitable giving is good for society, the economy, and culture. You should do your part to encourage as much of it as possible.

And here's what I think is the most important reason it's good to have a large number of donors: They'll hold you accountable to run programs that make sense -- and to be able to talk about your programs so they make sense. It's easy for an organization to spiral into a Looking Glass World where nothing you do makes sense to outsiders. Producing communications that are effective are an ongoing reality check that can save you from that error.

So give me two thousand pain-in-the-butt donors any time.

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What is this blog all about?

If you're serious about raising money from donors, you need to get serious about donors. More than ever before, donors are insisting that you share power with them, not treating them like passive ATMs. This blog is about the ways you can do that -- and the rewards that await you and your donors when you do.

About the Blogger

DonorPower Blog is penned by Merkle's Power Blogging Team, led by Greg Fox, our senior vice president of strategy. Working with Greg is a police line-up of guest "artists", fundraising pros all, who like to pose as blogatorialists when the sun goes down. You can reach this blog, and any of our regular contributors, at
donorpowerblog [at] merkleinc [dot] com. See this blog's policies.

A great partner for the nonprofit that wants to get donor-powered and grow revenue like crazy!
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