Charity:Water

Charity Water was founded in 2006 by a most unlikely person imaginable to start a non-profit. Scott Harrison, a nightclub promoter in Manhattan got disenchanted with his work and decided to dedicate his life for charity. He discovered that poor people in the developing world struggle to access safe and clean drinking water because they lack the money and support to build wells and pumps. With a mission to fund water projects around the world Scott founded Charity Water. The organization currently has 12 full time staffs, 800 volunteers and together they raised $7.5 million last year. Charity Water is primarily involved in fund raising activities and they use humanitarian organizations to build the actual water infrastructures.

Scott Harrison incredible personal story has somewhat made him a media darling and he was able to leverage this for his cause very effectively. Charity Water is featured in most top television channels and print media such as ABC, CNN, Fox and the New York Times. In addition, as I mentioned in my last post just by observation you will see that Charity Water has built a strong brand using Twitter, Facebook, Blogs, etc. Scott is an astute marketer and he leveraged his network very effectively to get celebrity endorsements and promote high profile fund raising campaigns for his cause.

I believe Charity Water is leveraging technology very effectively to bring a new level of transparency in philanthropy. Donors, no matter how small is their donation can now trace GPS coordinates and pictures of projects they are funding via Google Earth technology. Charity Water has developed an extremely user friendly website called mycharitywater.org where volunteers can do fundraising campaigns. The volunteers can customize the website according to their taste and provide information to their donors about the places where their money is being used. Charity Water did a “September Campaign” in 2008 where people born in September were asked to forgo their birthday gifts and instead ask their friends and family to donate for Charity Water. The campaign became viral and almost $1 M was raised in that month. Since then, Charity Water ran similar successful campaigns where volunteers were encouraged to run, bike, sky dive or simply give up birthday or anniversary gifts.

With my research and above observations I can make the following assessment about the core competence of Charity Water:

• Strong brand equity built around the founder Scott Harrison. The brand embodies a sense of hipness, youth, progressiveness and transparency.
• Strong online search engine presence. Both in terms of Search Engine Optimization (natural search) and Search Engine Marketing (paid search) Charity Water comes top in the search engines results for any queries related to water crisis.
• Built a very effective website. The website is very visual making it very effective to promote a crisis which is happening in a place geographically far from the donors.
• Strong organization capability to promote high profile fundraising bash

Since 2006 Charity Water has been growing their funds at 125% CAGR. From $579,463 in 2006 they generated $6,456,932 in CY 2008. Of course, they might not be able to maintain this pace forever. My goal is to make sure that they can at least maintain 50% CAGR for the next three years. That means in CY 2011 they should be able to generate $21 M in donations. Just to put things in perspective Habitat for Humanity, a 30 year old veteran, raised $88.5 M in donations in FY2008. I’m trying to strike a balance between Charity Water’s past performance and realistic future potential. Let me know if I’m correct in my assumptions.

I’m still looking for data in terms of the overall fundraising market for Charity Water. I want to know how much of total donations are generated every year for this cause. This can give me a perspective on Charity Water’s market share. Irrespective of the total market size I believe the primary strategy for Charity Water will be “Acquisition -> Stimulate Demand”.

In order to make the “Category Definition” for Charity water I looked at its primary benefit as – an organization improving the health and well being of impoverished people by providing them access to clean water. However, with such a narrow category definition, am I concluding that the primary competition for Charity Water will be other non-profits providing similar services? Do I really have to care about competition? Here I’m struggling, because I’m not sure how to define the competition for Charity Water and I look forward to your suggestions.

The next is 4-B analysis and here, I was wondering if I can make my calculations backward. I know what my fund raising targets are and therefore I can work my way backwards to determine the number of donors I need and the number of projects I can fund. I look forward to your comments if you think my logic is flawed. I will also try to raise this issue during the class…