Return on your donation investment

The amazing thing about this is that for every $1,000 a person donates to support starting this, $20,000 in donations will be generated over the first five years, $40,000 over 10 years, and $60,000 over 15. That is a return on a person’s donation investment of 60 times in just 15 years. This is how it works:

It costs $300,000 to fully fund a new field representative functioning at their normal rate of finding, qualifying and monitoring non-profits. Once the field rep is fully functional, s/he alone can locate $2.1 million in qualified non-profit needs (a.k.a. capacity) per year to list on our site as donation options from which the public can choose. Besides our field rep costs, our only costs are to market the site so the donation capacity is filled and to run the organization.

For the first two years of each field rep, these costs must largely be covered by start-up donors. After two years, however, these costs are entirely covered by the small administrative fee we receive for all donations made to non-profits through the site, and by sponsorship (corporate, foundation and individual) of the country pages, the field rep blogs, the daily news section and the front page of the site. So a field rep position becomes self-funding after two years, and all donations thereafter to that field representatives non-profits are donations the founding funder created. They would not have taken place otherwise.

A donation of $1,000 generates $60,000 in donations in 15 years, and since the field representative is self-sufficient through the admininstration fees and sponsorship, it keeps generating more donations for years.

We will have a special section of the site dedicated to honoring all people who donate to start The Least of These. Those who donate $300,00 will be permanently known as Founding Funders.

This amount generates over $12 million in donations over a ten-year period - a return 40 times the donation investment. The amount of good $12 million can do in Africa is stupendous. At twenty years, this is $24 million and 80 times. At forty years, it is $48 million and 160 times.

Bringing the 1 billion people in extreme poverty out of this miserable condition is the challenge of our generation. Leveraging the power of the Internet and the massive wealth of the United States is a key part of the solution.

The benefits of becoming an initial donor of The Least of These are that you the opportunity to be at the cutting edge of this, have a huge impact and get “the biggest bang” possible for your donation investment. You will be able to look back in the future and say to yourself and to your family and friends that you helped save and enrich the lives of huge numbers of people. That is a legacy worth having.

To donate online by check or credit card, please click here. You can also mail your check payable to The Daily Source at 25 Stearns Rd. #2, Watertown, MA 02472.

This is a project of The Daily Source, a 501(c)3 non-profit organization, and all donations are entirely tax-deductible.

Providing a better model for overseas giving

Almost all of the “overseas” donating done by people in the U.S. is to non-profits based in the U.S., not those based in the countries that need the help. This is because people do not have the time or money to verify that an overseas non-profit is the equivalent of a 501(c)3 organization (which is necessary to prove to the IRS for tax deductions) and to research if the organization is well-run and ready to use donations wisely.

Weaknesses of the current approach

They also do not have the time or resources to make sure the money they donated was well-spent.

This current situation is an ineffective approach to solving the core problems that are at hand because:

a. The countries in the worst condition desperately need local non-profit institutions that are experienced, well-run and powerful. Those local institutions create greater stability, greater local leadership and independent places of power outside of the government, military and big business. One reason the U.S. is strong and wealthy is that we have long had numerous strong and dynamic institutions and independent groups based here. The least-developed countries generally lack that history and the current giving model essentially reinforces that problem.

b. It is very expensive to have management, support staff and headquarters (with related expenses of rent, utilities, etc.) based in the U.S. Doing that is probably 10-20 times more costly than having those same things based in Africa, South Asia or Latin America. Right now the current model basically reverse outsources staff to the U.S., where operations are far more expensive. This greatly diminishes the impact of donations.

c. While this increases costs, a related but separate impact is that fewer jobs are created in underdeveloped countries. Having jobs in these countries creates jobs where they are desperately needed.

d. Outsiders might have important ideas, resources and expertise in certain areas, but the people in each country ultimately have greater knowledge of their circumstances and know the paths out of their own plights better than outsiders. Having non-profits based in the countries takes greater advantage of this knowledge.

e. It causes people in underdeveloped countries to lack ownership and power over their own situations, they then become less motivated and more dependent. People will support what they have a role in creating. Such engagement creates both sustainable organizations and societies. The opposite is true as well. Outside experts tend to disenchant people. When they do not have ownership over a process or an organization, they are less inspired to take action.

f. Donors are not engaged in the process, have little choice and do not see where their donations are going.

Our model: a perfect solution

We will provide a perfect solution to the problem in these ways:

We will send qualified field representatives to find and evaluate worthy non-profit organizations overseas. We will make sure the non-profit truly needs funds, and also has the organizational capacity to make effective use of them.

Our website lists hundreds of non-profits for whom donations could be earmarked. As described above, donors are emotionally engaged with the non-profits through the use of photos, videos and online field journals. We will provide naming opportunities for people to sponsor the non-profits in various ways. We will show how much of the “donation capacity” of that group has been reached. When it reaches capacity, we will remove it from the donations page and list another worthy non-profit.

Donations are entirely tax-deductible because they go through us and we have verified they are tax-deductible.

We will monitor results to see if the money is used effectively and if the organization deserves ongoing funds. Donors have access, via our site, to all follow-up evaluations.

Our field reps have organizational development, coaching and consulting skills to help foreign groups become more organized, focused and better managed. If additional outside expertise is needed, we will help them find the right resource.

Benefits

Our approach will bring the following benefits:

1. Donated money goes much further. Almost all funds go towards the foreign non-profits and the work they perform. Their rent, staff salaries and other expenses are lower than those in the U.S. We only take on the roles that are truly needed.
2. More jobs are created in the underdeveloped countries. In addition, the money spent by these people helps to create other jobs.
3. Non-profits in underdeveloped countries are strengthened. They acquire valuable leadership and organizational skills. They offset the dominance of the military and governments in those countries.
4. Local ideas and knowledge have greater play than they currently do, all the while being supported by outside expertise in the areas that need assistance.
5. Local populations are more engaged, motivated and empowered, and less dependent.
6. Donors are more engaged, have the choice of which non-profits to support and are able to see the results their donations have.

We believe individuals will be far more likely to donate internationally once they see the benefits of our services described above, both to themselves and to the recipients. In this way, the two parts of our mission are synergistic. Increasing the levels of giving to those in greatest need will generate more money for the better approach. Offering a better approach will increase the likelihood of giving.

Providing a better model for overseas giving

Almost all of the “overseas” donating done by people in the U.S. is to non-profits based in the U.S., not those based in the countries that need the help. This is because people do not have the time or money to verify that an overseas non-profit is the equivalent of a 501(c)3 organization (which is necessary to prove to the IRS for tax deductions) and to research if the organization is well-run and ready to use donations wisely.

Weaknesses of the current approach

They also do not have the time or resources to make sure the money they donated was well-spent.

This current situation is an ineffective approach to solving the core problems that are at hand because:

a. The countries in the worst condition desperately need local non-profit institutions that are experienced, well-run and powerful. Those local institutions create greater stability, greater local leadership and independent places of power outside of the government, military and big business. One reason the U.S. is strong and wealthy is that we have long had numerous strong and dynamic institutions and independent groups based here. The least-developed countries generally lack that history and the current giving model essentially reinforces that problem.

b. It is very expensive to have management, support staff and headquarters (with related expenses of rent, utilities, etc.) based in the U.S. Doing that is probably 10-20 times more costly than having those same things based in Africa, South Asia or Latin America. Right now the current model basically reverse outsources staff to the U.S., where operations are far more expensive. This greatly diminishes the impact of donations.

c. While this increases costs, a related but separate impact is that fewer jobs are created in underdeveloped countries. Having jobs in these countries creates jobs where they are desperately needed.

d. Outsiders might have important ideas, resources and expertise in certain areas, but the people in each country ultimately have greater knowledge of their circumstances and know the paths out of their own plights better than outsiders. Having non-profits based in the countries takes greater advantage of this knowledge.

e. It causes people in underdeveloped countries to lack ownership and power over their own situations, they then become less motivated and more dependent. People will support what they have a role in creating. Such engagement creates both sustainable organizations and societies. The opposite is true as well. Outside experts tend to disenchant people. When they do not have ownership over a process or an organization, they are less inspired to take action.

f. Donors are not engaged in the process, have little choice and do not see where their donations are going.

Our model: a perfect solution

We will provide a perfect solution to the problem in these ways:

We will send qualified field representatives to find and evaluate worthy non-profit organizations overseas. We will make sure the non-profit truly needs funds, and also has the organizational capacity to make effective use of them.

Our website lists hundreds of non-profits for whom donations could be earmarked. As described above, donors are emotionally engaged with the non-profits through the use of photos, videos and online field journals. We will provide naming opportunities for people to sponsor the non-profits in various ways. We will show how much of the “donation capacity” of that group has been reached. When it reaches capacity, we will remove it from the donations page and list another worthy non-profit.

Donations are entirely tax-deductible because they go through us and we have verified they are tax-deductible.

We will monitor results to see if the money is used effectively and if the organization deserves ongoing funds. Donors have access, via our site, to all follow-up evaluations.

Our field reps have organizational development, coaching and consulting skills to help foreign groups become more organized, focused and better managed. If additional outside expertise is needed, we will help them find the right resource.

Benefits

Our approach will bring the following benefits:

1. Donated money goes much further. Almost all funds go towards the foreign non-profits and the work they perform. Their rent, staff salaries and other expenses are lower than those in the U.S. We only take on the roles that are truly needed.
2. More jobs are created in the underdeveloped countries. In addition, the money spent by these people helps to create other jobs.
3. Non-profits in underdeveloped countries are strengthened. They acquire valuable leadership and organizational skills. They offset the dominance of the military and governments in those countries.
4. Local ideas and knowledge have greater play than they currently do, all the while being supported by outside expertise in the areas that need assistance.
5. Local populations are more engaged, motivated and empowered, and less dependent.
6. Donors are more engaged, have the choice of which non-profits to support and are able to see the results their donations have.

We believe individuals will be far more likely to donate internationally once they see the benefits of our services described above, both to themselves and to the recipients. In this way, the two parts of our mission are synergistic. Increasing the levels of giving to those in greatest need will generate more money for the better approach. Offering a better approach will increase the likelihood of giving.

Sample site pages

Sample non-profit page

The following is a sample non-profit page showing how non-profits will be featured with links to videos, photos, blogs and more.

Harnessing the power of the Internet

Americans have a significant untapped interest to give internationally even though they are unaware of the full scope of the problem, and of the full extent of their wealth relative to most of the world.

We think once Americans’ awareness of the full extent of the problem is heightened, and they are connected to high-quality non-profit projects, they will provide significant financial support to the poorest of the world.

We will do this by:

1. Engaging donors emotionally in the non-profits through use of photos, video and web journals.
2. Presenting high-impact information. We have pinpointed the highest impact details possible. We will present the most salient of these in introductory spots like on the front-page. More in-depth views will be offered on pages such as “People in the Greatest Need.” Besides educating the public, this will also become a resource for teachers and parents educating their children.
3. Recognizing donors through various naming opportunities including becoming non-profit sponsors (featured on non-profit pages), country sponsors (featured on country pages) and The Least of These benefactors and supporters (featured on our front page and other pages).

1. Allowing donors to give directly to overseas non-profits, to our general project fund, or to scholarships and fellowships for promising individuals.
2. Emphasizing what great differences donors can make with their money. Their donations get the biggest bang for the buck going towards the people in greatest need. The impact of their donations does more good.
3. Allowing people to donate simply by shopping on Amazon, searching on Google or charging items to their credit cards
4. Involving people in spreading the word and in fundraising. Visitors can email their friends photos and descriptions of the non-profits’ they support. We will also develop a volunteer fundraising kit that gives people the tools to fundraise for the overseas non-profits they want to support. Individuals, companies, schools and other groups can create fundraising pages to raise funds for projects
5. Publish the largest and highest quality repository of daily news, information and photos related to those in need. Our archives will be great resource for researchers and workers in the field. It will also be a place where students can find information for papers they’re writing.

1. Show donors the results of their donations. Donors will be able to read evaluations our field representatives write on the non-profits, read about progress made in the web journal and see photos and videos of the non-profits’ successes.
2. Position giving not just as an obligation, but as an opportunity. Giving to others allows people to feel good and to participate in something larger than themselves. Donating needs to be presented in this way so a positive feeling is associated with it.
3. Draw upon quotes from musicians, businesspeople and spiritual leaders to inspire people to give. For example, while most spiritual traditions place a very strong emphasis on helping the poor, this is rarely tapped into.
4. Providing advanced donor services for large individual donors, corporations and foundations.

The bad news and good news

Even though most Americans are in the top 5% of the world in wealth, we annually give only 2% of our enormous total income to non-profit organizations.

Of this, only 1.3% goes to non-profits with an international focus so we, as the richest people in the world, end up keeping 98.7% of our charitable donations for our own domestic purposes. Close to all of our giving goes to benefit people in the top 20% of the world. (If a person makes $10,000 a year, they are in the top 20%).

The arrow below represents 98.7% of all donations. Done to scale at 97 times smaller than the large arrow, the arrow representing the 1.3% going to the poorest is not visible to the eye.

Some of this 1.3% goes to non-profits in wealthy countries like England and Canada. This means that of the total private income in the U.S. only .02% goes toward helping those in the greatest need in the world.

For example, a person making $100,000 typically donates only $2,000 to non-profit organizations, and only $4 goes to non-profits working with the countries in the greatest need.

Americans typically think they give large amounts. Asked to estimate how much of the U.S. budget is used for foreign aid, Americans on average estimated 20% (respondents realized this did not include military defense costs). Asked what proportion would be an appropriate amount, Americans on average said 10%. The actual amount: 1%.

When all government and private aid is factored in, the U.S. only gives away .25% of its total income. This puts it behind almost every other industrialized nation. It is seven times lower than Sweden and the Netherlands.

Net Aid by major industrialized countries (US $ millions)

	Total ODA	Other Official Flows	Grants by Private  Voluntary Agencies	Private Flows	Total Flows	Total Flows  as % of GNP
Canada	1,744	5	113	4,621	6,483	0.95
Denmark	1,664	-3	32	482	2,176	1.39
France	4,105	14	Not avail.	1,439	5,557	0.43
Germany	5,030	-456	846	7,000	12,420	0.67
Italy	1,376	-103	37	9,537	10,846	1.01
Japan	13,508	-5,200	231	2,725	11,264	0.23
Netherlands	13,135	38	306	3,469	6,947	1.85
Norway	1,264	Not avail.	179	-5	1,437	0.91
Spain	1,195	3	Not avail.	2,272	3,471	0.61
Sweden	1,799	0	26	2,127	3,456	1.76
U.K.	4,501	-72	536	2,093	7,058	0.50
U.S.	9,955	562	4,069	10,666	25,252	0.25

The good news is that even though Americans lag far behind most other countries in giving to those in the greatest need, they do have a great latent willingness to do so.

For example, a poll in 2000 found an overwhelming 87% favored the US “giving food and medical assistance to people in needy countries.” When asked if they would be willing to contribute $50 in their tax dollars towards a program to cut hunger in half by 2015, 75% said yes, and only 19% said no.

In an October 1999 poll by PIPA, an overwhelming 68% agreed (31% strongly) that, “As one of the world’s rich nations, the United States has a moral responsibility toward poor nations to help them develop economically and improve their people’s lives.”

Studies have also found that Americans favor providing aid directly and channeling it through private non-profit organizations. They are aware that aid to governments is less effective, and they overwhelmingly favor aid going to programs that work directly with those in need.

So there is a latent willingness in Americans to give more aid internationally, though it is almost entirely untapped at present.

We aim to inspire Americans to donate more of their income overall, and to give more of it internationally to the places that need it the most.

Where we’ll raise funds - who has the most

Most of the world’s income is concentrated in the countries belonging to the Organization for Economic Cooperation and Development (OECD), primarily made up of the United States, Canada, Western Europe and Japan. The average income of people in OECD countries is $28,500, and in the United States it is $35,500.

Another way of looking at this is that the average income in America is about 46 times richer than that of the poorest 1 billion people on the planet. To show a proper graph of this 46 to 1 ratio we would need half a page

Nearly 90% of the US population is amongst the wealthiest 5% of the planet, and roughly 95% is in the wealthiest 10 percent. As this chart shows, a person making over $8,000 per year is in the richest 10%:

Source: Branko Milosevic, World Bank, October, 2002

All figures are based on purchasing power parity meaning $100 would buy you the same amount no matter where in the world you were. Differences in the costs of living for all regions are already taken into account.

Average per capita wealth in high-income countries like the U.S. in 2000 was estimated at $439,063, while in low-income countries it was only $7,532:

Total wealth per capita

Income group	Natural Capital	Produced capital + urban land	Intangible capital	Total wealth
Low-income countries	1,925	1,174	4,434	7,532
Middle-income countries	3,496	5,347	18,773	27,616
High-income OECD countries	9,531	76,193	353,339	439,063
World	4,011	16,850	74,998	95,860

All dollars at nominal exchange rates. Oil states are excluded. OECD: operation and development

For the United States, the average was $512,612 per person.

For these reasons, we will focus our efforts on raising money in North America and Europe.