Don’t tell the Pan-Mass Challenge that donor-advised funds are a problem for the charity world. Gifts from Fidelity Charitable — the largest sponsor of the often-controversial accounts and the nonprofit spinoff of the financial-services firm — are helping the Boston bike-athon break giving records even as other charity athletic events see revenues decline.
PMC was 12th on Fidelity’s most recent ranking of the 20 charities that received donations from the largest number of its funds. It was the only regional organization to make the list, joining such national household names as the American Cancer Society, Salvation Army, and Planned Parenthood.
The group raised $3 million from Fidelity Charitable in 2017 — up from $800,000 five years ago. It y cleared about $3.5 million in Fidelity contributions in 2018.
Following this year’s two-day event in August, Pan-Mass handed off a record $56 million to Dana-Farber — 10 percent more than in 2017. By contrast, revenue for the 30 largest peer-to-peer athletic events declined by 7 percent last year.
Since its launch in 1980, PMC has raised $654 million for the hospital.
Billions for the Asking
PMC’s Fidelity windfall stems at least in part from its location in the same city as the brokerage giant. Also, bike aficionados who gravitate to cycling events like PMC tend to be more affluent and more likely to have stock accounts than, say, walkathon participants.
But the organization says the boom in Fidelity giving also stems from its embrace and promotion of donor-advised funds. “These accounts are just growing; the billions in them are astounding,” says Michele Sommer, PMC’s chief financial officer.
Gifts from donor-advised accounts are increasing at PMC even as its contributions made using American Express cards are flattening, Sommer notes.
Other charities frequently call her about PMC’s success with Fidelity, and she tells them: “You just have to really go for it and know that it’s just too big to turn your back on.”
Promoting Funds
PMC takes very purposeful steps to educate donors — and riders raising money — about donor-advised funds. The organization’s website features a page that details how the funds work. It also promotes them as “an excellent way to both simplify your charitable giving and facilitate your strategic philanthropic goals.”
When Sommer meets with riders to talk about how to raise money, she urges them to bring up the funds with potential supporters. The money, she explains, has been earmarked for charity; it’s there for the asking, so you need to ask.
“My spiel is basically: This money has already been given way,” she says. “Whoever steps forward and says ‘Hey, you can use that to help my cause’ are the people who are going to get it.”
Sommer says the growth in giving through Fidelity Charitable is in part the result of a widget installed on the charity’s donation page that allows donors to click through to Fidelity’s donor-advised-fund page, prepopulated with the information to make a gift. PMC officials helped Fidelity and a handful of other donor-advised-fund sponsors design the widget, called DAF Direct, which debuted in 2013.
Five years later, overall DAF Direct results are mixed — Fidelity says it may soon revamp the tool — but PMC is a fan. “The easier you make it for donors to give, the better we all are,” Sommer says.
Groups that talk to Sommer about her success worry about receiving a flood of anonymous gifts from donor-advised funds. But Sommer says only a tiny fraction of the 4,600 gifts made this year can’t be traced to a donor.
“They’re anticipating a problem that isn’t nearly as big as they think,” she says.
Correction: An earlier version of this article incorrectly said the Pan-Mass Challenge was among the 20 charities that received the most money from Fidelity Charitable Fund donor-advised accounts. Instead, the group ranks among the 20 that received donations from the largest number of Fidelity funds.
