The New Way to Give: Virtual Charity

The digital age is changing philanthropy, as smaller donors use the Web to pick and choose — and evaluate and criticize — the charities that matter to them.

This is shaking up the status quo for charities of all sizes, raising concerns that people might think that they’ve done enough by just clicking their mouse. But supporters say the new approaches are letting individuals take more control of their philanthropy.

For a look at the new giving, SmartMoney focused on three individuals on the vanguard of philanthropy. Below, we tell how charities are tapping virtual worlds. (For an overview and a look at how one man started up his own web-based charity to fight hunger, read part one of “The New Way to Give”; for an examination of how charities are borrowing from the world of venture capital, read part two. )

Cheers erupt from bright-clad supporters on the sidelines as someone walks, runs or skates by on a track lined with lit bags, honoring those fighting cancer and those who have died from it. Volunteers give away T-shirts near a big cherry blossom tree and musicians entertain at nearby stages throughout the 24-hour Relay for Life walk-a-thon for the American Cancer Society. Survivors and caregivers swap stories about their cancer experiences.

It might sound like a traditional benefit, but this one had a twist: It took place in the game-like virtual world called Second Life. Rather than humans on the track it was “avatars,” digital images clad in traditional athletic gear (as well as much more provocative outfits), controlled by cancer supporters, caregivers and volunteers at computers around the world.

If that seems a little out there, trust us: It is. But this virtual walk-a-thon — the American Cancer Society’s fourth — raised $210,000 and attracted more than 2,000 participants. Supporters could donate in Second Life, through the world’s currency known as Linden dollars, or offline with regular dollars. Like many of the ACS’ activities, the idea came from a volunteer.

But be it a virtual community like Second Life or a more familiar one like Facebook, these tools are not really about the money they bring in — yet. The savvier charities are using them to reach the burgeoning class of mini-Rockefellers while they’re still developing their philanthropic chops. In other words, it’s branding. Like selling soda in elementary schools, the idea is to get people familiar with a brand or cause early in life, so they’re more likely to develop an attachment.

Nefarious comparisons aside, charities take some risk in entering tenuous online agreements. For example, the American Cancer Society allows volunteers who want to build online communities to use its logo and templates — opening up the possibility they are used in ways the nonprofit would rather not see. “There are pitfalls. You’re banking on their good will,” says Guy Fischer, national chief development officer for the Society. “Most large organizations are slow to do this, but that is where the world is going.”