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ActBlue: Remaking Political Fundraising

Image via ActBlue

One organization you have probably never heard of has raised billions for progressive campaigns.

This article is part of our Political Innovation series that explores organizations, people, and technologies disrupting the political landscape.

In American politics, cash is king. After the Supreme Court’s ruling on Citizens United in 2010, money is more important to political candidates than ever before. After all, candidates and their super PACs (political campaign organizations that pool donations from corporations, unions, and individuals) have an unprecedented amount of money to influence election outcomes. As a result, the two main parties are locked in an arms race to raise cash in order to tilt the odds of winning in their own favor.

For some context, between 2015 and 2016 in the last presidential election cycle, Democratic candidates raised just over $800 million, compared to Republicans’ $648 million.

While there are hundreds of investment vehicles, organizations and strategies that political campaigns employ to raise this kind of money, one organization stands apart from the rest. Enter ActBlue.

Founded in 2004 by Caltech PhD candidate Benjamin Rahn and MIT computer science graduate Matt DeBargalis, ActBlue dubs itself as “the clearinghouse of the Democratic Party.”

What makes this partisan fundraising technology stand out from the multitude of other platforms?

As of December 2017, ActBlue has raised over $1.9 billion (with a B) to progressive campaigns since its founding. Its most impressive feat yet may be that nearly all of the donations come from individuals, not from corporations, unions, or large non-profits.

According to their website, ActBlue’s “Mission is to democratize power and help small-dollar donors make their voices heard in a real way.”

For some context, in the first quarter of 2017, the tech organization raised funds from 4.2 million individuals, amounting to $111 million in raised cash for that four-month period. No other organization has come close to matching this massive of a donor pool.

The ActBlue model stands in contrast to conventional fundraising methods

Traditional political fundraising has been focused on courting donations from select groups with deep pockets. This model makes sense for two reasons. First, when one wants to raise large sums of money, it is intuitive to target people or groups with lots of it (such as unions, billionaires, and for-profit corporations). Second, there is the vexing practical issue that political campaigns have to overcome — with limited manpower, it is difficult to reach more than a handful of potential donors for a contribution. Instead, the traditional thinking goes, why not concentrate efforts on a select few high-potential, wealthy donors?

With its comprehensive set of technology solutions, ActBlue has managed to bypass these limitations. By providing a suite of user-friendly software tools, ActBlue clients can create straightforward donation forms that work across devices, from the desktop to the smartphone. The process has become so streamlined that thousands of progressive causes have deployed these one-click fundraising forms, from local races to presidential campaigns.

If you have ever donated to a left-leaning cause online, odds are that you may have been using the technology built by this digital powerhouse.

Implications of ActBlue’s success

Is this model disrupting future of political fundraising? Most likely. Comparing the quantity of individual contributors from the third quarter of 2013 (637,923), to the same quarter of this year (3,178,688), we can see that the number of donors has grown by nearly a factor of five in only four years. Even if the rate of expansion were to slow down in the coming years, progressive causes and campaigns will likely still maintain a strong lead in grassroots fundraising compared to their conservative counterparts.

The success of ActBlue begs the question: do conservative politicians and activists have a similar high-tech fundraising machine? In short, the answer is no.

“Republicans can feel free to copy what we do,” according Nate Thames in 2014, who is the executive director of ActBlue Technical Services.

It is widely accepted that for the most part, Silicon Valley and its diaspora of computer programmers, engineers and designers are a Democratic Party intellectual stronghold. This reality does not bode well for Republican campaigns seeking to tap into the burgeoning digital grassroots fundraising space.

According to a 2016 report by Pew Research, Democratic voters were more than twice as likely to donate than their Republican counterparts. Perhaps more conservatives would be willing to contribute, but only if it were made more accessible.

This article is part of our Political Tech series that explores companies and technologies disrupting the political landscape. If there is a company that you think should be featured, please email the suggestion to henri@merionwest.com.