Peer-to-Peer Fundraising vs. Crowdfunding

Posted on: February 18, 2021

The Main Similarities and Differences.
How to Choose The Right One for You!

For years, nonprofits have been using both peer-to-peer and crowdfunding platforms successfully. These platforms have been of particular help during the pandemic and have performed well throughout. 

Nonprofit Fundraising Options

According to Social Media Giving Statistics, these are the encouraging percentages:

  • 55% of people who engage with nonprofits on social media end up taking some sort of action
  • 59% of those people donate money
  • 53% volunteer
  • 52% donate clothing, food, or other personal items

It is up to you to decide which fundraising type, or using both at various times, would be best for your cause.

In order to make an educated decision, it is good to know what each online fundraising campaign, peer-to-peer or crowdfunding, entails and how each works.

How Peer-To-Peer Fundraising Works (Many To One Approach)

A way to think about how peer-to-peer fundraising works is that many people are reaching out for donations to one nonprofit.

Peer-to-peer fundraising is like having a fan club that raises money for your nonprofit’s cause. 

Peer-to-peer gets your supporters involved with your mission to raise money. The overall process of peer-to-peer is this:

  1. Your nonprofit will determine its goal and sets up its main campaign page using a peer-to-peer fundraising platform.
  2. You will recruit volunteer supporters to be fundraisers that set up their individual campaign pages.
  3. Your organization will provide those volunteer supporters with resources to use while promoting their pages.
  4. The volunteer fundraisers share their pages on a variety of social media platforms.
  5. Your organization will track the campaign’s progress and offer continued support to the volunteer fundraisers.

Do Peer-To-Peer Fundraising Campaigns Work?

Yes, peer-to-peer fundraising campaigns do work. They are also cost-effective. These campaigns engage fundraisers by relying on your supporters’ relationships. Peer-to-peer makes use of a fundraiser’s existing network. 

Your fundraiser will be reaching out to their peers, friends, coworkers, and family. One of the reasons that peer-to-peer is effective is that it builds on already established relationships.

Your fundraisers can customize their donation page to reflect their relationship with your organization and its mission.

Your organization will be reaching people that you might not reach under normal circumstances, as each fundraiser will have a wide variety of friends and family that might not have ever heard of your nonprofit. 

Because of their relationship with your fundraiser, they will be introduced to your organization and inspired by your fundraiser’s faith in your cause.

This form of campaigning has the potential of expanding the profile of your organization among like-minded people, but at the same time peer-to-peer can reach a more diverse audience than those your nonprofit usually reaches.

When Should You Use Peer-To-Peer Fundraising?

A peer-to-peer fundraiser is very versatile. You could choose to use this strategy when you have:

  • Time-based fundraisers. If you have just a certain amount of time to achieve your goal, peer-peer can rally the troops in a hurry to help support the cause.
  • Rolling fundraisers: If you have no set end date, the peer-to-peer platform can help keep your campaign at the forefront of your supporter’s minds with the peer-to-peer fundraising pages.
  • When holding A-Thon fundraisers: Perfect for a walk-a-thon, bike-a-thon, or any type of fundraiser that will inspire others to join in supporting the cause. One creative nonprofit used a “Zeldathon” that saw gamers playing and supporters donating for every hour of play. 

How Do You Go About Executing a Peer-To-Peer Fundraiser?

While the peer-to-peer concept is simple, it can be more challenging to stay on top of this type of campaign. The best way to do this is with comprehensive peer-to-peer fundraising software that helps you through the process.

How Crowdfunding Works (One To Many Approach)

Where peer-to-peer fundraising was many people (your supporters) reaching out to fundraise for one nonprofit, crowdfunding goes in the opposite direction. Crowdfunding is an example of one nonprofit reaching out to many people for donations.

Entrepreneurs initially used this form of fundraising as a means to gather small-sized investments to for-profit ventures. According to Forbes, the crowdfunding market will be worth $300 billion by 2025. Those statistics tell you that crowdfunding is a viable avenue to raise money.

How Does A Nonprofit Use Crowdfunding?

For a nonprofit, a crowdfunding campaign is typically tied to a specific project or goal. You would set up your online crowdfunding page containing the information about the project or the event. 

Once your page is set up, your nonprofit will share the campaign across your social media profiles, like Facebook, Instagram, Twitter, or YouTube. You would also email your current donors about the fundraiser. Your crowdfunding page will have the ability for people to donate from the page itself.

With crowdfunding, the nonprofit is the primary driver of all promotion and activities associated with the fundraiser. You might invite your donors to share the campaign with friends and family, but donors are not involved in the fundraiser, unlike peer-to-peer fundraising.

Why Would You Choose To Do Crowdfunding?

Here are some of the reasons that your nonprofit might choose crowdfunding over peer-to-peer.

  • When it is a one-time thing. If you have a particular project or specific need or expense, crowdfunding is a great platform. If your nonprofit has a large audience of followers on your social media channels, you can use those channels to display your crowdfunding page and give updates.
  • When you want to keep it simple. Crowdfunding campaigns generally only require a single domination page. However, it can require continual posts, updates, and regular engagement.
  • When you have a specific need. This type of fundraiser does well when there is a specific target rather than annual giving.
  • Giving days. If you have giving days, like #GivingTuesday, these types of mini-campaigns are easy to do on a peer-to-peer platform. They tend to be a fun way to add a sense of urgency to the campaign.

Crowdfunding Campaigns Tend To Be Simpler To Execute

Crowdfunding is a simpler strategy than peer-to-peer as you will need just one donation page. The promotion of the page will account for most of your time and effort.

Peer-to-peer tends to be more complex, as you will need to reach out to find supporters who are willing to help. Those supporters will also need some training on how to set up and use their platforms. You will also need to check in with them and be available if they need support.

While peer-to-peer might be more complex, it does have the potential of bringing in more donors.

Which option is right for you?

Many organizations include both Peer-to-Peer and Crowdfunding campaigns in their development schedule. Here are some simple points to help determine which option is best for your fundraising need.

It Might be Best to use Peer-to-Peer Fundraising if: 

  • You have a base of loyal supporters
  • You would like to reach a wider audience to create brand awareness
  • Have time to plan and execute an event

It Might be Best to use Crowdfunding if:

  • You have a need to fund a project
  • You have a large audience on social media and/or email
  • Don’t have much time and have a specific goal

Final Thoughts

It is best to have a trusted source to help you navigate these waters, as the last thing you want is a peer-to-peer or crowdfunding campaign that goes awry for performance issues. All your good work could be negated and it would be hard to gain back trust in your processes. 

Whether you use a peer-to-peer fundraising platform or crowdfunding, seek out a trusted platform that others have used with success and would confidently use again. 


Please feel free to contact us @MinistrySync on Instagram or Facebook or email us at care@ministrysync.com, and let us know if you’d like to learn more about our event planning tools, FundEasy or AttendEasy.

Also, if you haven’t joined already, we have an exclusive Facebook Group just for our Ministry Sync customers! If you are a current customer and would like to join, go here to learn more and request to be added!

Crystal Hoag
Crystal Hoag

This article was inspired by our customers and written to encourage your fundraising efforts. Although we work with ministries and events daily, our team members are not Event Consultants. We encourage you to consult with your event consultant, executive team, and/or affiliate organization before making any major changes to your events. 

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