As the chief executive of the crowdfunding site GoFundMe, Tim Cadogan is no stranger to disasters. But until the Eaton fire forced him to evacuate his own home in Altadena, Calif., last month, a crisis had never landed on his actual doorstep.
He was in his home office, wrapping up work on the evening of Jan. 7, when he heard the thump of helicopters. He drew back the curtain and was greeted by a terrifying line of orange fire marching down the hillsides above his house. Moments later, Mr. Cadogan and his family evacuated.
Although their home was not burned, they cannot return there for months, if not longer. That left Mr. Cadogan scrambling to file insurance claims and find a new place for his family to live, all while managing one of the biggest surges in donations ever made through his company’s platform.
“I had a mission, which is help people, help each other,” Mr. Cadogan, 54, said about his company. “I felt like it was really deep in my core. But like, now it’s like in the bones, you know?”
Since the fires broke out, people have donated more than $250 million to victims of the Los Angeles fires as well as to charities working on relief efforts through GoFundMe — $20 million more than the company helped collect for all natural disasters worldwide last year, according to the company. More than a million donors in 160 countries have contributed to that total.
Those donations, impressive as they are, cannot begin to cover the formidable costs of rebuilding Altadena, the Pacific Palisades and other areas devastated by the fires. That task, conservatively estimated in the tens of billions of dollars, will instead fall largely on insurers, private developers and the government. And crowdfunding efforts have been the subject of frequent criticism, in part because their free-market approach tends to reward those with wealthier networks of friends and family.
Still, at a moment when President Trump has threatened to completely shut the Federal Emergency Management Agency and life-altering natural disasters appear ever more frequent, the need for an efficient pathway for financial support for people who need to find shelter, clothing, food and transportation after a crisis has never seemed more urgent. Crowdfunding platforms — of which GoFundMe is by far the largest — are aiming to fill some of that need.
Among those who have turned to the site for help is Catherine Ramírez, a single mother of two, who lost the house she was renting to the Eaton fire.
The campaign her friends set up for her has raised a little over $13,000 to date — a small fraction of the $150,000 she estimates she will need to replace the specialized therapy equipment she needs for her son, who has cerebral palsy. Still, she said, the money has been helpful.
“I’m going to need every penny,” she said.
Damen Wright posted before-and-after photos of the three-bedroom stucco house he shared with his siblings and parents on the GoFundMe campaign he and his brother started five days after the blaze. “In this time of need, we’re asking for your generosity in helping us meet the needs that might not be fully covered by other sources of aid,” reads the text of the fund-raiser.
So far, it has raised $12,105. That is far short of the family’s goal of $30,000 to help cover rent costs while Mr. Wright’s family decides whether to rebuild, but Mr. Wright said the money had cushioned the financial toll.
“It’s definitely helped,” Mr. Wright, who works for the Transportation Security Administration, said while he and his brother Damen, in white Tyvek suits, poked at the ashes of the home they grew up in. “Every little bit counts” Mr. Wright said.
The prominent role of GoFundMe in the recovery efforts has led to some confusion, and even false claims.
During a news conference four day after the fires began, Kathryn Barger, the chair of the Los Angeles County Board of Supervisors, said she had been forced to pay a $95 fee to the company to make a $500 donation to a friend whose home had been lost in the fire. “I was shocked,” she said, adding, of the company, that “they deserve to be able to pay for their overhead, but at the same time, we are in a crisis.”
In fact, Ms. Barger had confused the option to leave a tip on donations with a mandatory fee. Those tips are GoFundMe’s primary source of revenue and what allows it to be profitable, company officials say. But the tips, which can be adjusted from 0 to as high as 28 percent, are voluntary. The company also charges a 2.9 percent fee on all donations, as well as 30 cents for every transaction, which it says covers credit card and bank transaction fees. It also draws revenue from Classy, a subscription-based software company that helps clients including the World Central Kitchen and Salvation Army raise money. GoFundMe officials rushed to contact Ms. Barger’s office and straighten out the confusion, although not before multiple outlets published critical articles.
As it happened, Mr. Cadogan had been volunteering on a search and rescue team looking for dead bodies in Altadena when the controversy broke out, and he was oblivious to the public relations disaster. But the next day, he ran into Ms. Barger at a community meeting. “She gave me a massive hug,” he said, noting that since then Ms. Barger had been promoting the fund-raising site.
It was hardly the first time the site faced pushback. Over the years, it has been attacked for hosting campaigns by anti-vaccine activists as well as a fund-raiser by the men behind We Build the Wall, a charity that raised $25 million to build a border wall with Mexico but was later accused by prosecutors of illegally diverting that money for personal use. One of the founders of that group, Stephen K. Bannon, Mr. Trump’s former adviser, is set to face trial for fraud in New York next month.
Although the Los Angeles wildfire fund-raisers have not generated that kind of political controversy, they have been closely scrutinized after numerous people reported discovering copycat fund-raisers using images of their homes and designed to profit off the rush of public largess.
“We have zero tolerance for misuse of our platform,” said Matthew Murray, director of regulatory affairs at GoFundMe. He leads a team of over 80 employees — roughly 10 percent of the company’s work force — dedicated to trust and safety, which has been using machine learning and human review to ferret out scams and to create a list of vetted wildfire-related campaigns that are highlighted on the GoFundMe home page.
More difficult to reckon with have been questions of fairness when it comes to disaster crowdfunding.
To address those concerns, curated lists of fund-raisers began circulating on social media just days after the fires. One, for displaced Black families, now includes almost 800 campaigns; another, for Latino families, numbers over 600. The goal, for those and other similar lists, was to draw more attention to those groups and potentially increase the amount of money they bring in, said Pete Corona, a film and TV producer in Los Angeles who helped organize the displaced Latino list.
“I think there’s some racial disparity that’s built into the algorithm,” Mr. Corona said. “We were hoping to address that.”
According to two researchers at the University of Washington, Mark Igra and Nora Kenworthy, the Los Angeles fires have underscored that concern.
The researchers, who have studied inequities in crowdfunding for years, found that the median fund-raiser on the displaced Latino families list has raised just over $15,000, while the median fund-raiser on the Black families list took in around $17,500. A third list, for Filipino families, raised slightly more on the median: $21,000. But all three groups fall well short of the overall cohort of vetted fund-raisers on GoFundMe, which have a median amount raised more than $25,000.
Mr. Cadogan, who has run GoFundMe since 2020, said he was acutely aware of the questions about fairness. To help address them, the company has been boosting the displaced family lists on social media, at times with celebrities and social media influencers, and has provided back-end support with vetting; it has also made donations of $1,000 apiece to more than 5,000 campaigns, drawing from money its raised through its nonprofit arm. That same fund has been used to support local charities that provide direct support to families in need.
One of those groups, the Change Reaction, received $1 million from GoFundMe. At an event late last month, the charity handed out 1,800 checks ranging from $1,500 to $5,000 to victims of the Eaton fire in a packed gymnasium in Pasadena.
Mr. Cadogan lingered for more than an hour after speaking to the crowd, listening to tearful people who had lost their homes and wanted to express gratitude for the support.
“We can’t change the socioeconomic structure of this country,” he said. “But we can make a dent.”
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