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Social Enterprise Cancels Charity Draw With Mercedes-Benz Prize – Blames Media For Controversy Raised

[Updated, 12 October]

The Given Company informed its donors on 9 October that its upcoming donation draw, which was meant to be closed on 2 November, has been cancelled.

The social enterprise will no longer be giving away a Mercedes-Benz as promised, and will issue full refunds to donors who purchased tickets for the draw.

However, it said it will still donate $13,000, the amount raised till date, to donors’ selected charities.

Prior to the announcement, one of TGC’s donors found that the grand prize of the draw had been changed from a Mercedes-Benz car to a “holiday” on TGC’s website, although the company had not informed them about the switch.

In the notice to donors on 9 October, TGC founder Charles Tan blamed the cancellation on media reports that raised controversy about their methods.

“While we expected and were prepared for detractors, having to address their concerns undoubtedly diverted our resources, delayed our marketing efforts and impacted overall sales,” he said.

Tan apologised for not being to give away the luxury car, and said that TGC will be planning for the subsequent draw next year.

The Society for the Prevention of Cruelty to Animals (SPCA), one of TGC’s charities, said it was informed of the cancellation and understands the decision made by TGC.

It also said it would follow up to make sure donors are refunded.

Charity Council chairman Gerard Ee commented that he was glad the donation draw was cancelled, and he hopes TGC had done so in response to public opinion that incentivised donation undermines the spirit of giving.

A Singapore social enterprise, The Given Company (TGC), launched its online donation platform on 29 August, pushing an unconventional model in which donors stand to win luxurious lucky draw prizes for contributing to charity.

The startup’s approach encourages people to donate to local charities for a chance to win prizes like a Mercedes-Benz car, or monetary rewards ranging from $8 to $10,000.

As one would expect, this quickly drew the attention of the Commissioner of Charities (COC), who is currently looking into TGC’s practice.

The COC’s office issued a statement saying it has brought up relevant legislative requirements to TGC, and that it does not endorse TGC’s operating model.

It particularly highlighted the requirement that fundraisers must have a written agreement with charities before soliciting funds.

In the statement, the COC also added, “we strongly encourage donors to be discerning to such online appeals and ask basic questions such as the purpose of the appeal; how will the donations be used”.

Defending Its “Incentivised Giving” Model

In response to the COC, 33-year-old co-founder, Charles Tan, said he believes that TGC has abided by regulations.

He said TGC has written agreements with its four listed charities, Society for the Prevention of Cruelty to Animals (SPCA), Alzheimer’s Disease Association, Life Community Services Society, and The Rice Company Limited.

While his website also lets donors choose to donate to other charities beyond the four listed, Tan feels that it does not count as soliciting donations for the other charities.

Since the launch of TGC’s donation platform, the social enterprise has been promoting the idea of “incentivised giving”, and “rewarding generosity” with attractive prizes.

Tan has said that this method aims to motivate more donors who need an extra push, and create a more sustainable fundraising system.

According to TGC’s website, the charity prize raffle is a “tried-and-tested system”, which its founders believe can solve people’s trust issues with fundraising organisations by creating a win-win situation for donors and beneficiaries.

Tan said that charity raffles have been used by organisations like the Singapore Children’s Society, and are also successful in countries like the United States and Australia.

“We understand that our operating model is relatively new in Singapore and it may therefore take some time before it gains mainstream acceptance,” said Tan.

“We don’t want to judge or prescribe how people give, [or] what form giving should take. We wanted to give people a nudge, an incentive, to set them on this path [towards]… purely altruistic giving.”

The Line Between Charity Draw And Lottery

Visiting The Given Company’s website, we found out how its online donation draw works.

The first thing it does is present donors with a selection of prize draws to choose from, with the current draw boasting a Mercedes-Benz CLA 180 Coupe as its grand prize, out of $180,000 worth of prizes.

After selecting a prize draw that interests them, donors will then purchase a $20 ticket that gives them a T-shirt and a chance to win a prize.

Although instructions on its website highly focus on the lucky draw and prize-winning aspect, information about the charities is also provided for donors who want to know more.

The website also shows that the next two draws to be held in 2019 may give away another luxury car, and even a condominium unit.

TGC plans to begin taking a 5 to 10 percent commission in subsequent draws in order to cover administrative costs.

It is aiming to raise $1 million in its inaugural draw that closes on 2 November 2018.

After covering the costs of organising the draw, including its prizes (worth a total of $180,000), net proceeds will be given to the respective charities nominated by donors.

While the COC’s office looks into the matter, it has reminded TGC of the penalties for offences under the Fund-Raising Regulations and the Remote Gambling Act.

What do you think? Do you consider this a form of gambling, or simply an unconventional way of directing funds towards charities that need them?

Featured Image Credit: The Given Company

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