GiveIndia - The Need for Giving in India

Agenda

India – Current Situation

GiveIndia – The Genesis

Key Stakeholders For GiveIndia

The Growth Story

India may be a land of opportunities, but plenty of work needs to be done to establish equity within society Source : UNDP Population : 1.15 Bn Annual GDP Growth Rate : 8.7%` 132 nd of 179 countries on the Human Development Index` 34% of the population is below Purchasing Power Parity of USD 1/day 27.5% of the population lives below the National Poverty Line 49% of the women live in poverty 35.2% of the population is illiterate

There is a large social sector in India but not enough giving taking place

Strong distrust on the credibility of non-profits due to past experiences, stories heard, inefficiencies reported, no reporting on fund usage, lack of audited financial statements

Most people want to give but do not know where their money will be properly utilized and therefore end up not giving at all

Source : http://www.vexen.co.uk/countries/charity.html, Copal Partners – India Charity Report http://infochangeindia.org/200303236519/Other/Books-Reports/First-ever-nationwide-survey-to-map-contours-of-non-profit-sector.html

There are ~1.2 million non-profits, with revenues of ~USD 4.7 bn, in India

Only 500 non-profits have annual income over USD 100,000

53% of the non-profits operate in rural areas

Nearly 20 million people work on a paid or volunteer basis in the non-profit sector

Social Sector in India

More than 75 million households give for charitable causes annually either in cash or kind – however a large part of this giving is towards religious organizations

People feel as if they have a moral obligation to give something back to society especially in the absence of a strong governance structure – but are faced with problems of trust and accessibility to suitable organizations

Giving in India

Individual charity in India is amongst the lowest worldwide even as the income disparities between the rich and the poor continue to grow

Last two decades have witnessed a widening of the gap between the rich and the poor

The poor have to deal with lack of basic amenities – access to decent education, healthcare and livelihood opportunities

In the meantime, the affluent have enjoyed the benefits of greater incomes, reduced taxes, 100% inheritance, etc.

The need for a giving culture… Individual Charity as % of GDP Giving by Individuals and Corporates is ~USD 200 Mn. in addition to foreign contributions amounting to ~USD 1.1 Bn. Source : http://www.vexen.co.uk/countries/charity.html, Copal Partners – India Charity Report India’s large social sector needs to be sustained by increasing giving significantly

Agenda

The Growth Story

While India has a huge potential for increased giving, certain obstacles need to be surmounted

Increasing affluence of the people at large has created surpluses which can be used for giving

Large and growing middle-class with growing incomes and consumption has a huge potential to be tapped to increase giving

There is increased awareness of the need to give back to society

Potential of Giving

Strong distrust of the social sector due to lack of transparency and accountability

Lack of convenience in giving (which organization to give to, how to give, getting tax-receipts, etc.)

Inability to determine how funds were utilized for the ultimate beneficiary

Inefficient mechanism resulting in only 60-70% of the funds reaching the end beneficiary

Obstacles to Giving

GiveIndia is a philanthropy marketplace which aims to ensure that resources reach the most effective organizations in an efficient manner Vision Mission A strong “giving” culture where Indians donate 2% of their income every year to a cause that matters. A vibrant “philanthropy marketplace” to ensure that the most efficient and effective nonprofits get access the most resources To promote efficient and effective giving that provides greater opportunities for the poor in India Operating Model The fundamental premise of our operating model is that the donor is an “investor” looking for “social returns” i.e. mostly the satisfaction of knowing the money made a difference to someone else’s life

GiveIndia provides a vibrant philanthropy marketplace bringing together non-profits and donors on a common platform using the power of the Internet Non-profits get listed with GiveIndia after a rigorous due-diligence Non-profits create donation options for listing on GiveIndia GiveIndia – The Philanthropy Marketplace GiveIndia undertakes various campaigns to attract donors GiveIndia also sells its PRG program to companies

The GiveIndia website is centered around selection of a specific cause and donation options for such a cause

Donors receive a feedback report after 4-6 months informing them on how their money was utilized

Report on how the money was utilised for every individual donation

Details about beneficiary/family and how the money made a difference to their lives

Verification visits at random to verify the same

Report sent in 4-6 months

What is a feedback report?

Donors can also view their past donations and download receipts

Low cost of fund raising, feedback reports and a large basket of NGOs are the key differentiators for GiveIndia which are difficult to replicate

Low cost of fundraising – Peak rate of 9.1% and an average 8% cost of fund raising is unparalleled in the Indian charity sector which anyway has a very low cost relative to US (23-45%) and UK charities (25%)

Feedback Reports –The GI model of being able to deliver feedbacks at this extremely low unit cost of <Rs50 per report (scalable down to Rs25 per fb) even with an SKU-wise order size as small as 10 units, is unparallelled in the world

Large basket of NGOs – 150+ certified NGOs and 500+ donation options where the certification is renewed each year and allowing people the choice to choose a donation option of his favourite cause

iGive – Ability to raise funds for a cause close to the heart of a fund raiser

Tax deduction receipts – Automatic generation/archival of receipts makes it easy for users to fetch the same while filing returns

Key Differentiators For GiveIndia

Agenda

The Growth Story

The GiveIndia marketplace comprises of non-profits, corporates, individual donors and fund raisers` Key Stakeholders for GiveIndia Implementing Non-Profits

No. of non-profits : 150+ across 17 states

No. of donation options : 800+

Mode of acquisition : Offline (Workshops, Foundations, etc.)

Delivery Mode : Online for sharing information and donations

Corporates

No. of companies : 60+

No. of employees signed-up : 25,000+

Monthly contributions : USD 100,000

Minimum contribution : USD 1

Mode of acquisition : Offline (1-1 signups)

Delivery Mode : Online for donations, receipts and feedbacks

Individual Donors

No. of users : 30,000+

Minimum donation : USD 10

Mode of acquisition : Online (SEO, Google Grants, banners, DMs, referrals, etc.)

Delivery Mode : Online for donations, receipts and feedbacks

Fundraisers

No. of fundraising pages setup : 250+

Funds Raised : USD 150,000

Minimum donation : USD 2

Mode of acquisition : Online

Delivery Mode : Online page creation and donation

Non-profits, one of the key stakeholders within the marketplace are “listed” with GiveIndia after a strict due-diligence process In addition, each listed NGO has to undergo a renewal cycle every year which ensures that these organizations are committed to being accountable and transparent Non-profit Organizations – Due-diligence Process Key Stakeholders – Non-profits

Non-religious, non-political institutions

Cater to the poorest sections of society - 50% of the beneficiaries have to be from households earning < Rs. 3000 p.m.

More than 2/3rds of the Directors cannot be related by blood or marriage

Salaries and reimbursements of Directors should be disclosed

Publish their audited financial statements

Etc.

Key Listing Criteria

Listed non-profits can setup various donation options on the GiveIndia website ranging from USD 10 – USD 300

Being listed with GiveIndia provides non-profits with an ability to raise funds even on its own as it is recognized to be accountable and transparent

Being listed with GiveIndia provides non-profits the opportunity to partake of other fund raising activities undertaken by GiveIndia – Read To Lead campaign, Bihar Floods

GiveIndia has currently listed 150+ non-profits

Benefits of Listing

GiveIndia considers donors as its primary customers and aims to fullfil their key requirements … they can find effective non-profits to channel their donations People will give more if…

GiveIndia’s due-diligence ensures that all the non-profits listed with us are accountable, credible and transparent

… they are informed how their funds were used to help the disadvantaged

A fund utilization report is sent for every individual donation within 4-6 months

… they know that most of the funds are being passed to the final beneficiary

GiveIndia passes on more than 90% of the funds to the beneficiary as against the 60-80% norms prevalent in most of the sector

… it is made convenient to give

Provides a quick and simple mechanism to make a donation akin to a shopping site

Host of payment options including online banking, credit cards and Paypal

Tax-deduction receipts for donors in India/US

Key Stakeholders - Donors

We also help corporates and High Net-worth Individuals (HNIs) by responding to their philanthropic needs with unique solutions Project Catalog

Contains projects ranging from USD 6,000 - USD 30,000

Proposals are prepared by our non-profits and vetted by GiveIndia

Contains details on scope, scalability and cost breakup

Donor receives a mid-term feedback and end-of-term final feedback report

Customised Giving Solutions Corporate Philanthropy Services Client Services

Identify suitable non-profits as per the specific needs of the donor

Design a project with the non-profit that suits the requirement of the donor

Monitor the project implementation and give periodic feedback to the donor

Objective is to assist corporates in strategizing their CSR activities

Assist in aligning CSR activities with the business and stakeholder objectives

Engagement model includes involvement of senior management, employees, customers, vendors etc.

Key Stakeholders – Donors

The Payroll Giving Program of GiveIndia is currently operational in more than 60 companies with 25,000 employees contributing ~USD 1.2 Mn p.a. Concept

Employees in a company can set aside a small sum of money (as low as USD 1), each month, from their salaries

As and when they feel appropriate they can donate this sum to the cause of their choice

Companies can choose to match an employees contribution thus increasing “giving” amongst its employees

Benefits

For employees :

100% pass-through of their contribution as companies pay a cost recovery charge to GiveIndia

Endorsed by the employer thus setting aside issues of trust and credibility

Be a part of a larger movement within the organization

For corporates :

Strong CSR activity involving participation of all employees

Little effort as all marketing and sales efforts are undertaken by GiveIndia

Ability to incorporate their current CSR activities within the GiveIndia umbrella

Key Stakeholders - Corporates

The Payroll Giving Program has grown from 3 companies in 05-06 to more than 60 companies across sectors Key Stakeholders - Corporates

Peer-to-peer fundraising is supported by GiveIndia through its iGive product Concept

An online fundraising tool for anyone who wants to raise money for a particular cause

Fund raisers associated with specific non-profits want to develop something specific - like a classroom, medical camp etc which are one-time events and thus not present as donation options

They will reach out to their friends and families for support to raise money for this cause - Friends and families largely trust the fundraiser and donate money

Fund raiser needs a convenient mechanism for his friends and families to donate online and obtain tax-deduction receipts

Critical Success Factors

Emotional personal appeal

Eye-catching visuals

Send link to atleast 200 friends and families

Rigorous follow-ups with potential donors

Fundraiser should ideally provide some sort of feedback to his/her supporters

Occasions to use iGive

Special events - marathon, charity dinners, auctions,

Individual events - Birthdays, Weddings, etc.

Disaster Giving - Floods, Mumbai Terror Attacks

Key Stakeholders – Fundraisers

We believe we have assisted our various stakeholders do their bit for society and they say so themselves “ As an NRI, I had to rely on friends and relatives to make donations…then I found GiveIndia's banner on the ICICI site. I have been a regular donor and have been impressed by the way you have grown to provide a link between the donor and the non-profits .” - Donor “ GI helped identify our primary charitable objectives. The CCS team has been great to work with, providing guidance and advice, but also offering us sufficient flexibility to allow us to do what was best for ING Vysya – VP, ING Vysya “ GiveIndia’s feedback report is awesome!! Detailing how the donated money is utilized and that too with illustrations is very reassuring.” - Donor "We had been grappling with vague good sentiments, but not knowing exactly what to do or where to start. They helped us clarify and articulate our intentions , resulting in a practical plan for effective and meaningful community involvement. “ – Jerry Rao, Chairman & MD, Emphasis "It is due to the efforts of your organization that a large number of non-profits including ours have been able to mobilize such large financial resources from across the world ."- Blind People's Association "I think GiveIndia is doing an excellent job of projecting the potential of getting donations to make a difference in the lives of the poor.” – CINI

Agenda

The Growth Story

GiveIndia is the fifth largest marketplace in the world but only eBay Giving Works has a lower cost of fundraising compared to GiveIndia 607% 648% 385% 45% 25% 28% 10% 42% 18% 8% 51% 119% 21% 4% Cost of Fund Raising $27,000 - - - √ - 2 $175,000 2007 Wokai $820,467 √ - √ √ 14(24 total) 4 $366,280 2001 Net4Kids $1.51million √ - √ √ 68 13 $383,000 2003 Connexion Colmbia $1.7 million - - - √ 200+ 4 $484,217 2004 GiveMeaning $2.08 million √ - - √ 70(Funded) 11 $200,000 2003 Help Argentina $2.12 million - - - √ 580 13 $900,000 2002 Modest Needs $2.5 million √ - √ √ 1,300+ 28 $451,114 2004 GreaterGood South Afirca $4.0 million - - - √ 450 40 $3,20,000 2000 GIVE Foundation $4.7 million - - - √ 563 22 $2.4million 2003 GlobalGiving $6.2 million - - √ - 12,000+ 61 $7.4million 2000 DonorsChoose $26.0 million - √ - - 300(Daily) 32 $5.4 million 2005 Kiva $103 million - - - √ 17,000+ 21 $4.0million 1999 MissionFish(eBay Giving Works) $20,582 - √ - - 98(147 Total) 5 $125,000 2008 Rang de $190,466 √ - √ √ 500+ 15 $732,560 2007 Better place Volun-teers Loans In-Kind Cash Funds Raised (last FY) Resources Brokered Offerings Staff Budget Founded Organisation

GiveIndia has channeled more than USD 12 Mn in the last 5 years and has grown at more than 45% CAGR each year Funds Channeled by GiveIndia (1) (FY2004-08, in USD ‘000s) Others (2) Online Offline (3) Notes: (1) USD 1 = INR 50 (2) Others includes Give2India, grants to channel partners, grants to NGOs and funds channeled directly to NGOs (3) Offline donations, Projects, Marathon related donations PRG CAGR : 47% CAGR (FY04-08) 11% 245% 107% 52%

In FY09, GiveIndia will channel approx. USD 6-7 Mn

Average donation on GiveIndia is approx USD 80-100 while minimum ticket size for donation is USD 10

Average donor on GiveIndia donates ~USD 120-150 p.a.

US donors give ~40-50% more than Indian donors

Apart from US and India, UK, Singapore and UAE are the major sources of funds raised from GiveIndia

Comments

GiveIndia has amongst the lowest costs of fund raising (CoFR) in the non-profit sector worldwide at 7-8% across years GiveIndia – Cost of Fund Raising Share of Expenses as a % of Funds Raised (FY05-09) Do you care how much money reaches the poor? (1) Concerned Not Concerned Would give more Notes : (1) Survey conducted by GiveIndia Source : GiveIndia Annual Reports

Donors are concerned about how much of their donations reaches the beneficiary (“pass-through”)

Most other charities have pass-throughs of 60-80% while GiveIndia has a pass-through of more than 90%

GiveIndia prides itself in the transparency of its cost structure thus enabling donors to make an informed choice

Why is a low CoFR important?

Appendix

While India has made some progress towards its Millenium Development Goals, we can see that there is yet considerable ground to cover (1/2) India – Progress towards Millenium Development Goals Goal 1 : Eradicating Extreme Poverty and Hunger Poverty Headcount Ratio Goal 2 : Achieve universal primary education Drop-out rate Source : Millenium Development Report, India Country Report 2005 Goal 3 : Gender Parity in Education Female Proportion in Primary Education Goal 4 : Reduce under 5 mortality rate Under 5 Mortality Rate (Death per thousand births)

While India has made some progress towards its Millenium Development Goals, we can see that there is yet considerable ground to cover (2/2) India – Progress towards Millenium Development Goals Goal 5 : Reduce maternal mortality rate (MMR) MMR deaths per 100,000 live births Goal 6 : Reduce prevalence of HIV/TB Deaths per 100,000 population on account of TB Source : Millenium Development Report, India Country Report 2005 Goal 7 : Ensure environmental stability Population with access to sanitation Goal 8 : Global Partnership for Development Tele-density

The iGive product was a resounding success during the Mumbai and Delhi Marathons with more than 100 pages being setup Key Stakeholders – Fundraisers

iGive pages have been setup to collect money for the Bihar Flood victims, and Mumbai terror attacks amongst many other causes Key Stakeholders – Fundraisers