When one donates to a charity, the transaction is a straight line: A donates to Charity D. We'll call this Linear Giving. Obviously, that has worked well over a vast amount of time, but not as well as it can--not even close.
What if you told just 2 friends about a charity you have a passion for? And, what if those 2 friends referred their 2 friends to the same charity?
This creates A+B+C donates to Charity D. This scenario turns 1 donation into 3 donations. This arrangement is 3x more productive turned Linear Giving into Geometric Giving or Exponential Giving. In this example, charities are leaving 2 donations on the table for every one donation given.
When applying math to this giving scenario, it grows aggressively, and very quickly: 2 to the 20th power would be over 1,000,000 donations ( 2x2x2 through 20 times.)
Here's a brief list of some of our findings:
1. Facebook has been a conduit for over $3 Billion in funds raised by individuals for charity.
2. By 2030, the market for personal fundraising is predicted to be $300 Billion. (Funders, Inc.)
3. Millennials are poised to inherit $68 Trillion. Millennials are more likely to give back to charity than other generations. In 2014, 84 percent of millennial employees gave to charity and 70 percent of them donated more than an hour to a charitable cause, according to the Case Foundation's Millennial Impact Report: 2015.
4. Friends will do what their friends do and what their friends ask them to do. Placed within
the framework of business, the interaction is called Referral Marketing.
Yearly, Friends Create a Mind-Boggling $6 Trillion in Referral Payments and Rewards for
Simply Telling Their Friends About Products and Services They Use and Approve of. (Womma)
Humans understand the referral process in a very intuitive way-- at the interpersonal level. In its infancy, Referral Marketing evolved from very small rewards. Move forward a decade and it's easy to find large financial rewards paid for something we all have always done for free.
One thousand dollars for referring a nurse, $500 for a home buyer referral, and $50 gift card for referring a friend to give plasma, sperm, skin-- and the list goes on. In its simplicity, it goes like this: Bring us your friends and their wallets and we will pay you, and in many cases, your friend as well.
There's no end in sight for the growth in referral programs. Referring is a strong force for consumer spending. In fact, today's businesses are flirting with a dangerous decrease in their customer base if they fail to implement a referral program.
Money That Talks
Here is a shortlist of the most famous referral programs that achieved growth at sonic speed thanks to friends referring friends for a financial reward.
$1,000,000,000 Paid Out In Referral Rewards From Just One Company: Rakuten. Rakuten has shaped the way people think about shopping and the concept of being rewarded for bringing their friends along to shop.
To date, over 12 million people in the U.S. have earned over $1 billion in referral rewards at their favorite stores.
Here's the really exciting part: Have you ever even heard of Rakuten?
Here are other amazing examples of companies that experienced extreme growth due to Referring:
- Vintage Travel, a Condé Nast Traveler Readers’ Choice Award Winner, pays $6400 in their referral program.
- PayPal experienced a 10% daily growth daily until it reached 100,000,000 users.
- Amazon Prime, one of the most widely used programs in history.
- Uber: $500 to a driver and $500 to the referrer.
- Tesla: $1,000 for both advocate and friend, with quite a star-studded list of advocates!
- Airbnb: a single user in China led to thousands of signups and hundreds of bookings in a single month.
- Dropbox: 15,000,000 users in a short span of 15 months
Here are 2 great examples of people helping people:
- Crowdfunding was raised up from a nonexistent concept to 50 million donors from 2010-2017.
- GoFundMe receives over $140 million in donations per month and made $100 Million in 2016.
Old as a Pyramid
Charity has been part of human culture for thousands of years and likely will continue until the end of time. There are numerous instances of charitable acts in ancient civilizations dating back as far as 2500 BC (or 4,500 years ago), which is around the time the Egyptians were building the pyramids.
Today, we associate charity with nonprofits and philanthropy.
More recently over the last 30 years or so, donations to charitable organizations have increased consistently year-over-year, far outpacing the rate of inflation. Today, charitable giving is a core value of western culture with over 95% of U.S. households donating to charity. Only the television beats 95% with the television weighing in at 95.9%.(Nielsen)
1. People intimately understand, since the beginning of time, the need to help others for common survival.
2. 95% of American households give to charity.
3. Referral Marketing pays out a whopping $6 Trillion yearly for friends simply referring friends.
Giving is Big Business
- Americans gave $427.71 billion to charity in 2018. This reflects a 0.7% increase from 2017.
- 1/3 of the nation's adult population participates in charity.
- Volunteer time converted into money @ $25/hour is $167 Billion yearly
Wall Street Journal: "Charity is becoming proactive, rather than reactive, to opportunistic fundraising."
The Atlantic: "Is For-Profit the Future of Non-Profit?"
Forbes: "The Rise Of The Charitable For-Profit Entity."
Time: "The Modern Way to Fundraise."
Funny Things Humans Do
- We are wired to follow others, be it stranger or friend.
- We do what we see others do.
- We pal around with people who think like we do and like the same things.
- It is highly predictable that people will do what a friend asks them to do-- especially when not in the presence of other people-- even if they do not want to.
- Friends are more likely to share the same interests as you and give to the same charity as you
These Grabbed Us
" Be of service to humanity. To give rather than to take. To relieve families from debt. To help the misfortunate. And supremely, to help America."
"What better way to give back than to build a business whose sole product is based on a spirit of giving to others in need.
"There has never been a better time in history to zig while most everyone will be zagging"
"Facebook has been a conduit for over 3 Billion in funds raised by individuals for charity."
"By 2030, the market for personal fundraising is predicted to be $300 Billion" (Funders, Inc.)
"Millennials are poised to inherit $68 Trillion. Millennials are more likely to give back to charity."
"Yearly, Friends Create a Mind-Boggling $6 Trillion in Referral Payments." (Womma)
"Today, charitable giving is a core value of western culture with over 95% of U.S. households donating to charity. Only the television beats 95% with the television weighing in at 95.9%." (Nielsen)
"Unbeatable longevity derived by the nature of the human spirit."
"Relevance in today's society."
"Everyone has 2 friends."
"It is highly predictable that people will do what a friend asks them to do-- especially when not in the presence of other people, even if they do not want to."
Grab 2 Friends. Donate to Charity. Get in Touch With Your Human Spirit. Do a Funny Human Thing. Be of Service to Humanity. Give Rather Than Take. Relieve Families From Debt. Help the Misfortunate. And Above All, Help America.