How ActBlue has transformed Democratic politics

How ActBlue has transformed Democratic politicsOctober 30, 2020

For four years, President Donald Trump and allies have dismissed signs of opposition, from rough polling numbers to big protests. But there’s no denying the overwhelming force of millions of people hitting ActBlue’s “donate” buttons.

Democrats from Joe Biden all the way down the ballot have buried Republican opponents under a remarkable avalanche of campaign ads, fueled by billions donated this year through ActBlue, the ubiquitous online fundraising processor for Democratic campaigns. Their wild success in 2020 has reshaped the way candidates not only raise money but campaign for office, building a culture of contributions as civic engagement that has grown into an overwhelming force. Republicans have tried to match it, but they still lag behind.

Amid all the once-in-a-lifetime features of this election, the explosion of online fundraising may be the one that truly transforms politics over time. And at the center is ActBlue, whose staff carefully grew a small startup over 16 years, enticing more and more Democratic campaigns to use it, making donating as easy as possible and guaranteeing that the platform essentially never crashes, especially in the most important and high-traffic moments — like if a Supreme Court justice dies unexpectedly and small donors rush to give a combined $70 million to candidates and causes in 24 hours.

Some Democrats already worry about a different kind of crash, questioning what happens to the online fundraising machine they’ve built when Trump is no longer president. But those nagging concerns are nothing compared to the disbelief, confusion or even anger from some Republicans, who have struggled to come to grips with the idea that this many online donors are really lining up against them.

South Carolina Sen. Lindsey Graham, who has voiced interest in investigating online fundraising platforms since Democratic opponent Jaime Harrison raised a record-smashing $57 million in the third quarter, said recently of ActBlue: “This thing’s weird to me.”

“It’s transformed Democratic politics, and it’s enabled us to compete with the big bucks boys on the other side,” said former Vermont Gov. Howard Dean, whose 2004 presidential run pioneered grassroots online fundraising. But Dean warned that if Trump is ousted, “it will be harder to raise money.”

“Rage gets people to the polls and to give,” Dean noted.

For now, with Trump and Republicans still in office, that money is still rushing in. This election cycle, a majority of Democratic candidates for federal office outraised their Republican opponents, propelled by those small-dollar donors that saved their credit card information with ActBlue. Contributors who gave $200 or less now make up nearly a quarter of the total money raised in 2020, even as super PACs that can raise unlimited sums from a single donor keep getting bigger. That speaks to ActBlue’s exponential surge, with the volume of donations processed doubling in every two-year election cycle since 2012.

“Small-dollar donors are funding everything — 21,000 different candidates and committees and causes — because it’s that kind of scope that involves our democracy,” said Erin Hill, ActBlue’s executive director. “It’s what happening at your school board race and it’s what’s happening in the presidency. Small-dollar donors recognize that, and they’re putting $5 and $10 donations into all these races that matter, which means we are expanding the map of what’s possible and more candidates are competitive.”

In Graham’s eyes, what ActBlue has achieved has gone beyond the realm of what’s possible. “I’d like some group, when this is over, to audit these things,” Graham said, also bringing in WinRed, the GOP-endorsed online fundraising platform. “Look at all of them.”

When asked about Graham’s comments, which have inaccurately portrayed how ActBlue functions, Hill called it a “willful misunderstanding,” adding that she “sees fear” when “you get that kind of pushback.”

‘We want to send you this money we’ve raised for you’

ActBlue is an unusual player in the campaign tech landscape. Founded in 2004 as a nonprofit, ActBlue aimed to be a piece of Democratic Party infrastructure, making it “as easy and frictionless as possible,” Hill said, for donors to give as little as $1 to campaigns or progressive groups, lowering the barrier of entry to campaign finance. The platform gained traction in the liberal blogosphere, drafting cash for candidates from regular readers of Daily Kos.

“They were literally calling up campaigns and telling them, ‘we want to send you this money we’ve raised for you because people on the Internet donated to you,’” said Julia Rosen, a Democratic digital strategist. “This was before anyone had a ‘donate’ button their webpage.”

Hill, who joined ActBlue in 2005, called it a “different era” when she had to “explain to people what the internet was and how to use computers.”

“The idea of using technology in campaigns was still very nascent at that point,” Hill said. Now, she added, “it’s turned into a strategic advantage for us on the left.”

As the internet knitted itself into the core of campaign strategy, ActBlue grew and grew, watching its usage tick up alongside the massive small-donor support for President Barack Obama’s 2008 and 2012 campaigns — which utilized custom donation processing software, not ActBlue. But Bernie Sanders’ online donor-fueled 2016 presidential run became a “turning point” for digital consultants, who could point to Sanders’ usage of ActBlue and “explain its power to down-ballot candidates,” said Mike Nellis, a former senior adviser to Kamala Harris’ presidential campaign who runs Authentic Campaigns, a Democratic digital firm.

Now, signing up for ActBlue is one of the first things Democratic candidates do. It’s atop the Democratic Congressional Campaign Committee’s checklist of pre-launch steps for its candidates, alongside hiring a campaign manager. Akilah Bacy, a Houston Democrat who’s among the candidates running to flip the Texas state House, said she started an ActBlue fundraising page “even before I announced” the campaign.

“I don’t know anyone who’s not using it in their campaign,” said Joanna Cattanach, another Democratic state legislative candidate in Dallas.

The platform allows any Democratic candidate or group to set up a fundraising page and put linked “donate” buttons in their emails and on their website. Small-dollar donors can start giving immediately, and when that cash trickles into ActBlue’s conduit PAC, it wires the money daily or cuts checks to the intended recipient, depending on that candidate or organization’s preference.

Every single donor, no matter how little they gave, is itemized in ActBlue’s voluminous campaign finance disclosures — a key area of misunderstanding for some Republicans, who have falsely accused ActBlue of failing to disclose the sources of the money they raise. (The group’s most recent quarterly FEC report weighed in at 11.6 gigabytes of data.)

Most importantly, ActBlue lets users save their credit card information. Campaigns still have to find their own donors by buying or building email lists, running online ads or getting help from big-name endorsers. But once they do, if those donors have given through ActBlue before, they can give again with one click, a quicker process that generates more money. The site itself is continually testing everything to optimize the giving experience, tweaking things as small as the color of the “donate” button if randomized trials show that it prompts a bigger response from donors. At the scale ActBlue runs, converting donors even a fraction of a percentage point higher means thousands more dollars for users.

To keep itself running and funding tests to improve the service, ActBlue asks donors to “tip” the nonprofit to pay for staff and upkeep. It also has a 4 percent processing fee off of each donation, all of which goes toward paying credit card processing fees, a legal requirement so as to avoid making any in-kind contribution to the groups or campaigns.

“If you’re trying to build technology within a campaign, you usually lack the resources and time is working against you, especially with fundraising, it can be pretty impossible,” said Betsy Hoover, a partner at Higher Ground Labs, a campaign tech incubator. “But ActBlue stays put, cycle after cycle. … If a campaign signs up with ActBlue, then they don’t need to do any of that work, and at this point, no one’s going to try to recreate it. Just take what’s there.”

ActBlue hit another milestone in February 2019, when the Democratic National Committee set the primary debate rules to include a minimum of 65,000 individual donors with 200 each from 20 different states. That decision came under harsh criticism by several presidential candidates for incentivizing “slash and burn” approaches to digital fundraising, but the DNC stuck to it and all 28 candidates used ActBlue.

“The DNC making that choice really set the tone” to center the 2020 campaign on the grassroots, Hill said. When asked if she expected small-dollar donors to play another pivotal role, should there be a 2024 Democratic presidential primary, she said, “Oh, I sure hope so. I think we can’t go back to what we did before.”

‘They’re genuinely bewildered, and that’s part of our problem’

In an effort to match Democrats’ machinery, Republicans launched WinRed in June 2019. It has had early success and posted some historic hauls of its own, processing more than $1.2 billion donations in its first year and a half. ActBlue reached that total in 2016, 12 years after its founding — and celebrated the milestone with a do-it-yourself balloon net from Amazon, dropping it on the staff after-hours when they crossed the 10-figure threshold.

But Republican digital consultants privately concede that the fear of ActBlue within their party speaks to a lack of familiarity and knowledge with online fundraising. That lack of awareness is hampering GOP efforts to catch up with Democrats’ online behemoth. Party operatives are not only trying to educate candidates on digital fundraising, they are scrambling to teach GOP voters to make online giving routine, as it has become for Democrats.

“It is extremely frustrating when Republican digital people have spent the better part of two years trying to break the logjam on this, and folks still don’t understand the basics of how it works,” said one Republican digital strategist. “I think they’re genuinely bewildered, and that’s part of our problem.”

Back in October 2018, House Republicans called the surge of donations through ActBlue a “green wave” of money that helped Democrats flip the chamber. And in April 2020, Senate Republicans warned their candidates of a coming “green tsunami” of online money barreling toward them.

Republicans leaned heavily on mega-donors to make up the gap, smashing their own fundraising records at the Senate Leadership Fund, the top GOP Senate super PAC, and at the National Republican Senatorial Committee. Even so, 16 Democratic Senate candidates outraised their Republican opponents in the third quarter of this year, powered by online donors.

“There were always going to be more grassroots donors than there could be mega-billionaires,” Hill said.

Eric Wilson, a Republican strategist who led the digital team on Sen. Marco Rubio’s 2016 presidential campaign, said that “it’s going to take a long time for Republicans to catch up to that advantage Democrats have built, the network effect of millions of donors with payment info saved” and a political culture that’s made contributions akin to “buying the jersey for your favorite sport’s team.”

But for Democrats, if Trump loses, “it’ll hurt,” he added. “The enthusiasm may not be there to bail them out in 2022.”

Staring down a post-Trump world isn’t something most Democratic digital strategists are willing to entertain yet, aware that the election isn’t over. But for those willing to look around the corner at losing one of their most profitable boogeymen, one called it a “long, cold, dark winter ahead of us,” and another called it “the great looming unanswered question for every Democrat.”

“When you’re in power, it is very hard to fundraise, especially when you lose the motivation of getting the bad guy out of his seat,” said Rosen, the Democratic strategist. “We’ll start with better email lists and more donors with a history of giving than ever before, but yes, I am preparing incumbents for what’s ahead.”

Andrew Desiderio contributed reporting.

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