Why do you think the appeal to donate to Haiti by texting has been so successful?

It was a powerful message replicated across all communication platforms for the benefit of major charities. Texting provides an immediate way for a person to respond. It’s a powerful medium to take action.

Its success builds on a few factors. Mobile giving reaches an addressable audience of 260 million cell phone users. As a country, we send billions of text messages a year. The technology has become ubiquitous. Because of the work we’ve been doing, the infrastructure and technology were in place when the earthquake struck Haiti, and agreements were pre-negotiated with the carriers. And the billing aspect is appealing because it doesn’t require the use of a credit card.

Hasn’t this technology been around for a while? What has changed since the tsunami in 2004?

When the Asian tsunami hit, two things were relatively new:Shortcodes only emerged at the end of 2002 and started as a way for brands to interact with customers; premium billing capability is even newer and came about in early 2004.

The vision for the Mobile Giving Foundation came through the initial response to the Asian tsunami. People at various wireless companies got together by phone at 11 a.m. one morning and by 5 p.m. we had a campaign across carriers. For those working in the industry, this feels better than trying to sell text alert packages.

After selling my company m-Qube, I wanted to establish an infrastructure for every day charitable giving.

Do you think mobile giving appeals to a younger generation of donors?

No doubt about that. One of the reasons nonprofits are interested in mobile giving is that it gives them access to a younger demographic that they have a hard time reaching. The demographic profile of mobile donors is assumed to skew heavily to the 18 to 21 crowd, which is valuable to nonprofits. They may give small today, but over a period of time may grow into more substantial donors. We’re currently putting research around that, trying to establish hard metrics.

Younger people like mobile giving because it’s a technology that’s familiar and it provides immediate satisfaction. In our research, one phrase we heard over and over was that “they felt empowered.”

What’s been the impact of social media on the success of text giving?

Social media had a strong impact, especially in the first 24 hours after the Haitian earthquake. There’s a period of huge emotional pull, which social media accelerates. We were able to go live with our mobile giving campaigns within two hours. Facebook and Twitter helped the campaigns go viral.

Does this success represent a sea change for mobile giving?

Yes, it has had an accelerating effect on making consumers more comfortable with text giving and on generating more interest from nonprofits. Before the earthquake, we were servicing more than 400 organizations. Since the disaster, we have added more than 23 charities specific to Haiti relief.

Mobile giving is attractive to nonprofits because of three elements: acquisition of new donors, fundraising and donor engagement—nonprofits can ask donors if they want more information, and, for instance, send them a link to their Web site.

What types of campaigns are most successful?

In our experience, mobile giving doesn’t work equally well for everybody. Response rates vary. The type of cause makes a difference. Campaigns that try to raise funds for capital construction, for instance, may only get a 1.5 percent participation rate, whereas campaigns that have a service element are a lot more successful. Text giving has a very immediate response, so it’s perhaps not surprising that more emotional appeals work best.

What are the costs to the nonprofit?

One-hundred percent of donations are given to the nonprofit. The only direct charge from the Mobile Giving Foundation to the charity is a $350 application fee.

Fees charged by the mobile marketing companies we work with vary. It depends on what the nonprofit needs. Do they want a sophisticated campaign that’s integrated with an online campaign, requires technology acquisition, database management or Web widgets? That adds to the cost. On average, the total fee structure is 6 to 7 percent. In emergencies, some mobile marketing companies will waive the fees.

What have been the biggest challenges to establishing the Mobile Giving Foundation?

Like any startup working toward a vision, everything can be a challenge. We had to resolve technical issues with the carriers and eliminate their typical 50 percent revenue share. We had to raise awareness among nonprofits and needed to explain how to use this as a fundraising tool. We had to reassure consumers worried about security and breach of confidentiality. Organizationally, we had to figure out how to raise enough money for the services we provide.

Why did you choose to locate the company in Bellevue?

I live in Redmond, so it was a matter of convenience. Some of the benefits to being in the area are that it is close to many wireless assets including AT&T and T-Mobile. There are many leaders and pioneers in the wireless and nonprofit industries in this area as well.

For more on the Mobile Giving Foundation, visit http://www.mobilegiving.org

Read all Startup City profiles.

Images: Startup City logo by Michelle Walls. Photograph of Jim Manis courtesy of the Mobile Giving Foundation.

Peter Luyckx is the Managing Editor at Flip the Media. Recently, he worked as a Web Producer and Editor at Microsoft’s MSN Health & Fitness and MSN Shopping (now Bing). He co-founded and published the environmental newsletter The Frugal Environmentalist. He is a graduate student in the MCDM program and can be followed on Twitter @ peterlux.

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