Crowdfunding is the process of raising money from a large group of people — a “crowd” — typically through an online platform like GoFundMe. And it’s become a popular way for Americans to raise money for unexpected — and potentially catastrophic — emergencies, such as medical expenses.
As of 2018, data from the United States census showed that more than 27 million Americans are uninsured (12% of U.S. adults). And according to a 2019 report by the Commonwealth Fund, of the Americans who are insured, 87 million (45% of U.S. adults) are underinsured — meaning their out-of-pocket health care costs are excessively high compared to their income. That means more than half of all Americans are without the security of knowing that adequate care is available to them when they need it.
In a country where even people with employer-sponsored health plans are chronically underinsured, it’s no wonder so many are turning to crowdfunding as a potential source of relief.
In fact, a 2020 survey conducted by the National Opinion Research Center (NORC) at the University of Chicago discovered that as many as 20 million Americans have started a campaign to raise funds to cover medical expenses for themselves or someone they know. And 50 million Americans — roughly 20% of U.S. adults — have donated to a campaign raising funds for personal medical expenses.
And while raising money through crowdfunding isn’t without its drawbacks, there’s no doubt campaigns helping people in need are the most popular, outpacing even donations to business startups. According to a 2016 report from the Pew Research Center, two-thirds of all Americans who’ve donated to a crowdfunding campaign gave money to help a person in need. Only one-third have donated to fund a new product.
But to capture the interest of all those donors, you must first choose the right platform. According to Statista, an organization that compiles market share statistics, there are hundreds of crowdfunding sites where you could potentially set up your campaign. But each has its own unique features.
So before you even begin asking for donations, pick the platform that best suits your needs.
How to Choose the Right Platform
Before you launch your campaign, make sure to browse several crowdfunding sites and get familiar with what each offers. Some are free to use, while others have platform fees that involve taking a percentage of all your donations. Some allow you to withdraw your funds as soon as you receive them, while others require you to meet your funding goal before you can access your funds. And all of them have unique features that suit some people better than others.
There are a few things to look out for:
- Types of Campaigns. Make sure your chosen platform allows fundraising for personal causes. Some crowdfunding sites, like Kickstarter and Indiegogo, are only for business fundraising.
- Ease of Use. Check to make sure the setup process is user-friendly. The best platforms provide plenty of tutorials on how to create your page, including how-to’s on embedding pictures and videos, using social media sharing, and posting updates.
- Payment Processing. Check to see how you get the money that’s donated. Most platforms connect to PayPal or a similar payment processing service. If your situation results in ongoing expenses, some of which you must pay sooner than later, choose a platform that allows you to access your funds as soon as the donations come in. It’s called a “keep-it-all” option, and it means you don’t have to reach your fundraising goal to withdraw donations.
- Fees. Investigate any setup fees and commissions. Some platforms charge an upfront fee to set up your page. Others offer free setup but claim a percentage of your donations. Still others provide “free” fundraising, which means they won’t take a cut of your contributions. But no crowdfunding platform is genuinely free. All deduct at least a payment processing fee from each donation because the fee comes from the processing company.
Top Platforms for Personal Crowdfunding
Note that nothing herein is an endorsement of any of these sites. Always check out each platform’s benefits, policies, fees, and limitations before signing up.
The largest and best known of all the personal crowdfunding platforms, GoFundMe allows fundraising for individuals, teams, and nonprofits. But it has particularly excelled in helping individuals raise money for their personal needs.
- Types of Campaigns: GoFundMe allows fundraising for any kind of project or cause. But more than a third of its campaigns are for medical expenses, including “elective” expenses, like IVF, making this a top site for medical fundraising.
- Ease of Use: GoFundMe provides plenty of tutorials and analyses of well-funded campaigns, so you get lots of help setting up your campaign.
- Payment Processing: They accept all major credit cards and mostly use WePay to process them. People can also make donations using PayPal, but only for certified charity campaigns. Fundraisers get to keep all donations, minus payment processing fees, regardless of whether they reach their fundraising goal. And they’re able to withdraw donations as soon as they receive them.
- Fees:There are no platform fees, but there are payment-processing fees of 2.9% plus $.030 per individual donation.
- Advantages: GoFundMe is the most well-known crowdfunding site, boasting a large platform, “free” fundraising, easy-to-use social sharing tools, 24/7 customer support, and the first and only donor protection guarantee. GoFundMe ensures every donation reaches its intended donee, and if something goes wrong, they refund the donation.
- Disadvantages: While the large platform is sometimes a positive, increased competition from millions of other campaigns can lead to fewer, if any, donations from strangers.
Created in December 2011, GoGetFunding’s goal is to disrupt the crowdfunding industry by providing users with an easy and flexible way to raise money for a cause.
- Types of Campaigns: GoGetFunding allows fundraising for any cause, but their most successful campaigns are for personal, medical, and charitable causes.
- Ease of Use: Creating campaign pages is fast and easy, involving only a few basic steps. Plus, there are many tips and tutorials for creating effective campaigns, both in video format and on their blog.
- Payment Processing: GoGetFunding accepts all major credit cards through their own in-house processing. They also accept payments through Stripe and PayPal. You can access donations immediately, whether or not you’ve met your goal. However, it can take up to seven business days to process funds through GoGetFunding or Stripe. PayPal donations are available that day.
- Fees: GoGetFunding charges a 4% fee on the amount raised plus payment processing fees of 2.9%.
- Advantages: GoGetFunding features well-designed fundraisers on its homepage and all campaigns on its Facebook and Twitter feeds. According to the site, they assess how well a campaign is put together by looking at features including pictures, videos, the story, and how many donors fundraisers have driven to their pages through their personal networks.
- Disadvantages: This platform is one of the few that charges fees on the amount raised.
It’s a smaller platform than many of its competitors, but FundRazr makes up for that in increased functionality and beautiful design.
- Types of Campaigns: While FundRazr allows you to raise money for almost anything, the most successful campaigns on this platform are for personal or charitable causes.
- Ease of Use: Because FundRazr uses a visual page builder, setup is fast and easy. Additionally, its pages feature built-in sharing tools, so posting to social media to enhance campaign reach is also simple.
- Payment Processing: FundRazr accepts all major credit cards and bank payments. They process them through your choice of PayPal, WePay, or Stripe. You can choose a keep-it-all fundraiser or an all-or-nothing fundraiser, which means you can’t access your funds until and unless you reach your goal.
- Fees: Individuals can choose a free fundraising model with no platform fees. There is a 2.9% plus $0.30 transaction fee for each donation received.
- Advantages: FundRazr allows you to create feature-rich campaign pages complete with advanced social sharing options, personal website integration, and perks and wish list options that enable you to offer small thank-you gifts or make a wish list of things you need, such as plane tickets, that donors can then sponsor.
- Disadvantages: The platform is smaller and less trafficked than its major competitors, and some users report that some support materials, like tutorials, are outdated.
Although a lesser-known platform, Fundly has helped users raise more than $330 million. Its keep-it-all policy, which Fundly calls a “no raise requirement,” and its supportive team make it one of the best platforms for personal fundraising.
- Types of Campaigns: Campaigns that are most successful on Fundly support individual needs or charitable causes. You can fundraise for personal goals, like a trip around the world, but those types of campaigns don’t do well on Fundly.
- Ease of Use: Easily add images, video, and text using their plug-and-play campaign pages. Their pages also allow for easy campaign updating using blogs and comments. All campaign activity posts to Facebook automatically. Fundly also provides extensive guides for setting up your campaign and ongoing tips through their active blog.
- Payment Processing: They accept all major credit cards and process them through Stripe. You get to keep all donations, minus processing fees. Funds are technically available for immediate withdrawal. However, processing them can take two to seven business days.
- Fees: There is no fee to create and start your campaign. But Fundly deducts a 4.9% fee from every donation plus a payment-processing fee of 2.9% plus $0.30 per transaction. They automatically apply discounts for larger campaigns.
- Advantages: In addition to fully customizable campaign pages and outstanding customer service, Fundly allows you to create your own in-house fundraising T-shirts, sweatshirts, phone cases, mugs, and tote bags, which they print and ship as thank-you gifts for donors who give whatever amount you establish. Although the cost of these fundraising items depends on the product and number of images, the price for printing and shipping the average T-shirt is around $15.
- Disadvantages: This platform is one of the few that still charges a fee on the amount raised. Most platforms are now free for personal fundraising.
One of the largest platforms on this list, JustGiving has helped connect more than 22 million users to donors who’ve given over $4.5 billion to various causes in 164 countries.
- Types of Campaigns: This platform specializes in fundraisers for charitable and personal causes. Campaigns include those for individuals with high medical expenses, hurricane victims, and relief to families facing tragedy.
- Ease of Use: While there are guides and answers to frequently asked questions (FAQs) available for new users, this platform has the fewest tutorials of any of these sites. They do, however, offer a fundraising toolkit that includes graphics — like Facebook cover images — and tip sheets to help with raising funds.
- Payment Processing: JustGiving accepts all major credit cards and sends funds to the donee through bank transfers. Fundraisers can withdraw funds for immediate use 14 days after setting up their page, regardless of whether they’ve reached their goal. However, it can take an additional six to 10 business days to process the funds.
- Fees: The fee structure varies from one country to another. In the U.S., there is a 5% platform fee plus 2.9% payment processing fee for every donation.
- Advantages: Anyone anywhere in the world can access all these crowdfunding platforms. But JustGiving is the most truly global, offering support for multiple charities around the globe in addition to personal causes.
- Disadvantages: The website is difficult to navigate. It’s hard to find information and FAQs without setting up a campaign or otherwise signing up as a user. That means you have to dig to discover relevant details like potential costs. And that’s especially crucial information since the fees for using the platform vary considerably from one country to another.
One of the larger crowdfunding platforms, Plumfund has helped its users raise over $500 million for a wide variety of causes. Besides allowing fundraising for personal needs, fundraisers can campaign for personal desires like weddings, honeymoons, baby showers, travel, and education.
- Types of Campaigns: Although Plumfund is useful for raising money for emergency expenses, this platform is potentially the best if you’re looking to fundraise for a personal project or goal, such as a backpacking trip across Europe.
- Ease of Use: Pages are easy to set up with plug-and-play tools. However, there are no tutorials or resources users can look to for advice on creating effective campaigns.
- Payment Processing: Fundraisers can choose from a wide variety of payment options, including offline payments by cash or check or online credit card processing through WePay or PayPal.
- Fees: There are no platform fees. But there are payment-processing fees of 2.8% plus $0.30 per individual donation for online transactions.
- Advantages: Plumfund allows fundraisers to set up registries and wish lists in addition to setting fundraising goals. Plus, setup and use is free to both fundraisers and donors. Fees are only involved with processing online payments, which are unavoidable, as the payment processor sets them. Users report outstanding customer service.
- Disadvantages: Plumfund has fewer tools and less functionality than some of the other platforms, including fewer social media options and page customization abilities.
The growing popularity of crowdfunding has led many to argue its use detracts from the very real systemic issues in this country that deserve greater attention. But until America’s health care system is fixed, it’s good to know there are so many Americans willing and interested in helping each other out.
As the NORC study exposed, most Americans agree it should be the government’s responsibility — and not friends’, family members’, or strangers’ — to cover medical costs for those in need. But the study also revealed that more than a third of Americans who’ve donated to personal medical campaigns gave to strangers.
As Susan Cahn, a senior research scientist at the NORC, told Fast Company, “This is the first time we know how Americans are helping each other, and that a large number of Americans are donating to people that they don’t personally know who have unmet medical needs.”
So if you can choose the right platform and put together a successful crowdfunding campaign, there are Americans out there willing to help.
Are you considering starting a crowdfunding campaign for yourself or someone you know? Which platform sounds like the best fit for your needs?