Iâm happy to do this, but I want to note that it seems to me like you may be overselling the opportunity with your post title (âOpportunity to increase EA org funding by ~$200K/âyear if a couple hundred EAs take 1 minute on Giving Tuesdayâ) since:
(a) VISA may very well not eliminate fees for payments to charity even if 200+ EAs do what you ask on Giving Tuesday, and
(b) The fraction of donations (made by EAs who filled out the EA survey) made using VISA credit cards may be substantially less than necessary to make the total fees amount to hundreds of thousands of dollars each year. (âEAs in the survey reported total donations of $16.1M USD in 2018.â However, not all of this is donated by credit cards, and VISA has 50% of the credit card market by purchase transactions.)
So my questions for you are:
How likely do you think it is that VISA will do this conditional on 200 EAs fulfilling your request on Giving Tuesday?
What fraction of donations reported on the EA Survey do you estimate are made by VISA credit card donation? (Or whatâs the total amount donated to EA nonprofits using VISA credit cards each year?)
Thanks for your support William itâs much appreciated! Please do repost on Giving Tuesday :)
(a) Youâre correct that they may not. We could multiply by a probability to get an expected value but IMO given itâs a perpetuity itâs definitely worth 1 minute.
I estimate the probability to be ~40%. This may seem high but through my job I work with large companies and have seen them make changes because of a handful of people posting on social media.
(b) When calculating the return my assumptions were (quick calculation here):
Small EA donors donate through credit cards, large EA donors do not
3% average credit card fee
If VISA eliminates the fee, other card companies will follow suit
Thanks for the reply! Sharing a couple other relevant thoughts just because I took the time to think them, but no reply is necessary.
(This is probably the sort of scenario where I should just spend the minute to tweet at VISA rather than spend several minutes trying to more precisely estimate the expected impact, but I only consciously thought of this after already spending a few more minutes thinking about the expected impact and writing out the following so Iâm posting my thoughts anyway.)
Re:
(a) Naively Iâd estimate that the counterfactual effect of 200 additional marginal EAs retweeting/âsharing the relevant posts on Tuesday on the probability that VISA eliminates fees for nonprofits in the next year is roughly ~5% (and possibly much lower if I thought about it longer). Iâd be shocked if this one push increased the probability by 40%, even though I do agree that sometimes (often?) large companies make changes because of a small number of people posting on social media.
(b) Adjusting your estimate with different more conservative assumptionsâa 2% average credit card fee, only donors <$10,000/âyear (rather than <$100,000/âyear) use credit cards to donate (i.e. $15.4% of the $16.1M/âyear rather than 43%), and assuming only the impact from VISA changing their feesâthen the direct impact would be closer to $24,800/âyear = (Your $207,690 estimate)(2%/â3%)(15.4%/â43%)*(0.5). The main direct impact this ignores is the fact that presumably many people who do not respond to the EA Survey donate to EA charities using VISA credit cards. The EA Survey VISA donors may represent a minority of VISA donors to EA charities.
Or you could just look at how much money goes to highly effective charities, since weâre talking about abolishing fees for all donors, not just EAs. The AMF had donations totalling 36 million in FY2020, so, using your values of 2% credit card fees, 15.4% of money donated by credit card (though I suspect the real value to be much higher, especially when considering non-EA donors) and visa holding 50% of the credit card market, thatâs a total of 55â˛000$ for just one charity. Given that, I think itâs perfectly reasonable to say that visa eliminating their fees would increase funding for the most effective charities by hundreds of thousands if not millions of dollars a year, though I disagree with JSWinchellâs methodology
Iâm happy to do this, but I want to note that it seems to me like you may be overselling the opportunity with your post title (âOpportunity to increase EA org funding by ~$200K/âyear if a couple hundred EAs take 1 minute on Giving Tuesdayâ) since:
(a) VISA may very well not eliminate fees for payments to charity even if 200+ EAs do what you ask on Giving Tuesday, and
(b) The fraction of donations (made by EAs who filled out the EA survey) made using VISA credit cards may be substantially less than necessary to make the total fees amount to hundreds of thousands of dollars each year. (âEAs in the survey reported total donations of $16.1M USD in 2018.â However, not all of this is donated by credit cards, and VISA has 50% of the credit card market by purchase transactions.)
So my questions for you are:
How likely do you think it is that VISA will do this conditional on 200 EAs fulfilling your request on Giving Tuesday?
What fraction of donations reported on the EA Survey do you estimate are made by VISA credit card donation? (Or whatâs the total amount donated to EA nonprofits using VISA credit cards each year?)
Thanks for your support William itâs much appreciated! Please do repost on Giving Tuesday :)
(a) Youâre correct that they may not. We could multiply by a probability to get an expected value but IMO given itâs a perpetuity itâs definitely worth 1 minute.
I estimate the probability to be ~40%. This may seem high but through my job I work with large companies and have seen them make changes because of a handful of people posting on social media.
(b) When calculating the return my assumptions were (quick calculation here):
Small EA donors donate through credit cards, large EA donors do not
3% average credit card fee
If VISA eliminates the fee, other card companies will follow suit
Thanks for the reply! Sharing a couple other relevant thoughts just because I took the time to think them, but no reply is necessary.
(This is probably the sort of scenario where I should just spend the minute to tweet at VISA rather than spend several minutes trying to more precisely estimate the expected impact, but I only consciously thought of this after already spending a few more minutes thinking about the expected impact and writing out the following so Iâm posting my thoughts anyway.)
Re:
(a) Naively Iâd estimate that the counterfactual effect of 200 additional marginal EAs retweeting/âsharing the relevant posts on Tuesday on the probability that VISA eliminates fees for nonprofits in the next year is roughly ~5% (and possibly much lower if I thought about it longer). Iâd be shocked if this one push increased the probability by 40%, even though I do agree that sometimes (often?) large companies make changes because of a small number of people posting on social media.
(b) Adjusting your estimate with different more conservative assumptionsâa 2% average credit card fee, only donors <$10,000/âyear (rather than <$100,000/âyear) use credit cards to donate (i.e. $15.4% of the $16.1M/âyear rather than 43%), and assuming only the impact from VISA changing their feesâthen the direct impact would be closer to $24,800/âyear = (Your $207,690 estimate)(2%/â3%)(15.4%/â43%)*(0.5). The main direct impact this ignores is the fact that presumably many people who do not respond to the EA Survey donate to EA charities using VISA credit cards. The EA Survey VISA donors may represent a minority of VISA donors to EA charities.
Or you could just look at how much money goes to highly effective charities, since weâre talking about abolishing fees for all donors, not just EAs. The AMF had donations totalling 36 million in FY2020, so, using your values of 2% credit card fees, 15.4% of money donated by credit card (though I suspect the real value to be much higher, especially when considering non-EA donors) and visa holding 50% of the credit card market, thatâs a total of 55â˛000$ for just one charity. Given that, I think itâs perfectly reasonable to say that visa eliminating their fees would increase funding for the most effective charities by hundreds of thousands if not millions of dollars a year, though I disagree with JSWinchellâs methodology