management still don't get it

August 11, 2017

PetRescue 'The Adoptables' banner ad

PetRescue is unapologetic to rescue groups questioning their new donations strategy using special needs pets (The Adoptables), and whether the more than $1 million dollar a year operating budget for the organisation is appropriate, considering they run a website. 

A response to a rescue groups on their Facebook page:

Can you please advise what % of my donation will go to Baby and Johnny?

"Our fundraising campaign is very clear where the money goes. Although your rescue group brings this up every time we fundraise, we do not believe that people who have actually donated to PetRescue aren't confused about where the donation goes or what it is used for.

All donations made to PetRescue are used to help rescue pets regardless of the group they are with. I know your group would prefer a cash donation, but this would mean we wouldn’t be able to fund our programs and services which amplify public donations giving far greater value to our other rescue members than a one off cash donation ever could.

Because of this public support in the last financial year, we have provided our members with:
- Food donations - $4.5 million +
- Flea & Tick treatments - $300,000
- Pet relocation flights - $10,000
- Corporate gifts direct to rescue - $60,000
- Website services - $204,960

Although your group, VicDRG is one of the very few groups lucky enough not to need these services (although you do take advantage of our website) the majority of our members rely on this help to lessen the burden and allow them to continue to focus all their energy on caring for their pets until they are adopted..."

So their argument is basically, we do give a lot of stuff to rescue groups, so that makes our yearly spend and our donation strategy totes appropes (oh, and no actual money goes to baby or Johnny).

PetRescue 'The Adoptables' banner ad

But let's break this down, shall we?

Food and flea treatments are donated by corporate sponsors as part of their sponsorship package. (Woolworths, PETstock). This is extremely good for rescue AND it is the perfect way for PetRescue to fund itself - through national corporate sponsorships which are unattainable to community rescue groups.

Flights again, are donated through corporate sponsors. This is a great way for a company like Jetpets to access a few dozen good news stories a year, and result in great outcomes. 

Corporate gifts direct to rescue; this is where things start to get a bit slippery. It's great when corporate sponsors want to give cash donations to rescue groups. However, PetRescue is not required for that to happen. Neither does PetRescue personally contribute to those cash amounts, so it is essentially contributing consulting services? advisory services? to corporate sponsors wanting to donate to rescue. 

So when PetRescue say "... Because of this public support... we have provided our members with..." they are stretching the truth somewhat. THEY haven't provided any of these services, except some advisory consulting work, and accepting and redistributing some product donations, in return for corporate sponsorship. A more accurate way to say this would probably be "... Because of our corporate sponsorships ... we have provided our members with...". Public support is pretty much irrelevant to these contributions.

According to the last published financials, PetRescue received $100k from Pedigree, plus $120k in other corporate sponsorships. Another $150k was from one major supporter. And $90k advertising income. So $460,000 from sources other than public donations.

Surely, this is enough to run the website, plus divvy out some product donations a couple times a year.

Website services - is probably where PetRescue is being the most accurate when saying "we provide this". And that is - according to their own figures - about $205,000 per year. However, according to their published statistics; "website & email" cost just $75k. So the actual running IT costs were pretty small. Of course you need staff -  $270k. And a place to put them; Rent -  $36k. And to send them places - Travel - $30k. So all together, about $336,000 in true expenses to run the website. 

Nothing near the $1 million dollar operating costs of last financial year, but probably most importantly, shouldn't have needed $500,000 in community donations to provide.

And that is the point the rescue groups were trying to make in questioning PetRescue's new "Adoptables" fundraising strategy. 

Even if using individual pets (with a focus on special-needs pets) doesn't intentionally mislead the public into thinking their donation is helping pets and rescue directly, it seems highly ethically dubious that a website that offers <$350k in web-services to rescue, needs $1 million dollars a year to run, and/or could be considered a good use of resources.

But that doesn't stop PetRescue's management feeling hard done by, for the ongoing criticisms of their operations;

JB is PetRescue's co-director and current CEO. He is referencing Dan Pallotta, who makes a compelling case that charities should be allowed to spend money and generate revenue, using the same tools as for-profit businesses, since they are solving the worlds big problems. His book, Uncharitable: How Restraints on Nonprofits Undermine Their Potential is a call to supporters of charities and those working in charities, to stop focussing so much on the money being spent and instead to look at the impact being made as the determining metric for a charity's worth.

Pallotta reviews the frugal, almost prudish constraints the public expects from nonprofits, everything from a ban on paid advertising to substandard wages for nonprofit employees. But if we want the nonprofit sector to do without the successful tactics of the business sector—say, marketing—how can we expect the nonprofit sector to aspire to greatness? How will it ever grow, get results, and reach new supporters? Not only must nonprofits be allowed to use the tools of commerce to thrive and accomplish their missions, Pallotta argues, but the public also needs to get over its mistaken and tenacious fixation on fundraising costs and overhead ratios. He goes on to show how misleading, easily manipulated, and plainly irrelevant these ratios are, and suggests we instead ask 16 questions that would reveal “What has the organization achieved, and what can it achieve with my donation?” Everyone who cares about nonprofit organizations and their potential accomplishments—from journalists to sophisticated donors to foundation officials—should read this section of the book. They’ll surely be convinced that fundraising ratios and program expense ratios are a silly, useless, and even fraudulent way to compare “efficiency” across nonprofit organizations.

And there is a lot that is right about this message. Of course charities should be able to make money to support their work. Of course charities should be working using solid business practices.

However, that is not what the issue really is here. And I quote an idea from fundraiser Tom Ahern;

If you're going to call yourself "Elephant Rescue" at some point you're going to have to rescue some elephants.

PetRescue isn't rescuing pets. It's running a website. And it seems to have completely forgotten this fact.

Sure, having a well-run website is a huge benefit to rescue groups. Having a free portal to advertise pets makes the lives of rescues much easier, as they don't have to spend any where near as much time working on marketing or advertising. But PetRescue is an advertising medium, not a group who rescues animals.

Which is why its current fundraising solicitation campaign blurring the lines between rescue, and PetRescue, was such a kick in the teeth to the groups actually doing the work.

A 'The Adoptables' special needs dog who was used on the site,
but didn't find his family via PetRescue (full story link)

I've written on why having PetRescue enter, dominate and canabalise the donations which would - and should - have gone to rescue groups, is not "supporting rescue". No matter how much free fucking flea treatments they get in return.

Why PetRescue’s new system will spell the end for growth in mid-sized rescue groups - The ‘Matchmakers Project’ is designed to pull enquiries into the PetRescue communications system, so they can better track WHO is adopting, and create a 'donate-to-PetRescue' solicitation strategy to target these people too.

I've written about how PetRescue should be using their tools to ensure rescue secure the donations that are rightfully theirs.

An proactive solution ... and the one which would really show just how much PetRescue values the groups it claims to support - would be for someone known to the system as having an existing relationship with a rescue, to be OFFERED for their donation to go to the group either entirely, or with a percentage still going to PetRescue. Surely the contact details of an adopter-donor belong more to rescue groups than to PetRescue - and PetRescue should not want to keep a donation intended for rescue - so there should be no issue with PetRescue handing this information over.

However, it seems PetRescue's JB is instead hoping Dan Pallotta might visit Australia and confirm to him that it's ok for PetRescue to make money hand over fist, using any donation strategy it likes, regardless of the cost to rescue, because... charities should have money, right?

PetRescue continues to be greedy. It continues to behave unethically. And it continues to mislead it's supporters as to the services and value it actually provides.

It's really very simple.

If PetRescue is going to fundraise, it must do so on the platform of "we have a nice website". This is accurate. It is non-misleading. (But it was never a very effective fundraising message, because people don't give to website, they give to save, care for and protect animals. Hence the strategy shift).

However, if it is going to use individual pets to fundraise, it must give practically all of those donations to the rescue groups who hold and care for those pets. It must share those donor details with the groups who generated them. And it must recognise that it is not entitled to those donations, simply because it can access them.

In short, PetRescue must actually support the rescue groups, it claims to be supporting, not steal from them.

Anything less is simply web-generated, robbery of Australian rescue groups. And PetRescue should be considered with the same distain as someone who steals a donation tin off a countertop; ugly, damaging and antisocial towards the rescue community.

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