Who owns Change.org? The change from a for-profit to a public benefit detailed

Change.org is the largest online driver of social change worldwide. It claims to host over 70,000 petitions a month and have over 400 million users. Petition users collect signatures supporting a particular petition, raising awareness about an issue, and more often than not, pressuring authorities to reverse controversial decisions or policies. 

The company has restructured several times since its creation, hoping to streamline and expand operations and respond to criticisms about its inner workings. Despite its presumably noble intentions, complaints about the company’s use of donated funds continue, especially in light of the accusation that it underpays its employees. 

Change.org has grown exponentially since its founding in 2007 by Ben Rattray

Change.org launched in 2007 as a nonprofit social networking site led by Ben Rattray. The company aimed to support individual petitions and raise money for existing nonprofit organizations. 

By 2012, the San Francisco-based company had expanded to four countries and had over 100 employees. Success stories from individuals who’d forced change through the website raised awareness about the website. 

For instance, 14 kids from a fourth-grade class in Brookline, Massachusetts, forced Universal studios to include an environmental protection message in a film. “It was exactly what the kids asked for – the kids were through the roof,” Ted Wells, their teacher, told The New York Times. 

“These kids are really feeling the glow of making the world a better place. They are feeling that power.”

Traditionally, the production company would have crushed the pleas of the 4th-grade students without lifting a finger. However, Change.org offered a platform for people to raise support for a cause with next to no resources used. 

Change.org faced pushback, most notably from Chinese hackers who protested a Change.org petition calling for the release of artist Ai Weiwei.

However, the company continued to grow into the social change behemoth it is today. Thanks to donations from users and investors, Change.org reaches people in 196 countries. A 2021 post by company executives on Medium reads:

“People now use Change.org in 196 countries, and in some countries usage is close to the number of total voters in elections. In the United States 54% of the public uses Change.org, in the UK it’s 56%, and in Spain it’s 52%.”

Change.org laid off hundreds of employees in 2017 following changes to its revenue model

In 2017, Change.org changed from a for-profit business focused on social issues to a public benefit corporation. Rattray wrote on the company’s website that the change would ‘enable us to put our mission at the core of our business operations.’

Change.org’s revenue model had proven unsuitable. The company raised most of its money through ad revenue – it would promote campaigns and petitions from organizations including Virgin American and the Humane Society. 

“While this was generating more than $20 million per year in revenue, it wasn’t growing quickly enough to scale our operations and faced increasing competition from other ad networks,” Rattray wrote. 

Rattray announced a switch to a crowdfunding system, in which Change.org took a 5% fee on all donations. Change.org also introduced a promoted petitions product, prompting people to donate funds to give more visibility to their petition. 

Furthermore, people could contribute to Change.org via a monthly subscription. Rattray said that the changes had generated millions of dollars of revenue. However, the company still had to lay off some employees due to the restructuring. Ben Rattray wrote:

“In doing this, we have made the very difficult decision to part ways with a group of remarkable teammates we are lucky to have had driven our mission, and who have helped impact the lives of millions of our users.”

A $30 million donation from Reid Hoffman and other investors like Bill Gates and Sam Altman helped keep Change.org afloat during the transition. Via the 2021 Medium post, the company’s executives thanked Reid Hoffman for his support during that trying time:

“When we faced our most challenging moment amidst a business model shift in 2017, Reid took the risk of personally investing $30m in Change.org, while pledging to donate any of the profits to charity. He has since helped turn around the organization financially and drive sustainable growth.”

Change.org is now wholly owned by a nonprofit foundation following a restructuring in 2021

In September 2021, 50 investors in Change.org donated their equity to facilitate the company’s transition to 100% nonprofit ownership, making Change.org the largest nonprofit-owned tech platform for social change. 

The Change.org Foundation nonprofit governing board oversees two organizations: Change.org PBC and Change.org Programs. The PBC wing focuses on technological expansion to cater to the growing usage of Change.org. Change.org Programs focuses on empowering marginalized people and communities. 

Ben Rattray is the executive chair of the foundation. “Nonprofit ownership will secure the long-term stewardship of Change.org as a digital public utility committed to the public interest,” Rattray said. “This shift in ownership and governance ensures the permanent independence of our platform and our legal commitment to our mission to empower people.”

The board picked Nick Allardice as CEO of Change.org PBC following a six-month search. Allardice had worked for Change.org for ten years, leading the company’s growth and campaign teams. Previously, he’d co-founded Below the Line, a digital fundraising company aimed at eradicating poverty. 

“I couldn’t be more excited for our next phase,” Nick said, “as we expand beyond petitions into a true civic infrastructure platform that empowers billions of people to use their voice, their money and their time to build a healthier, more participatory and responsive society.”

Preethi Herman is the executive director of the Change.org Foundation. It supports high-impact nonprofit programs around the world needing philanthropic support. Herman is also a member of the Change.org Foundation Board of Directors. 

Change.org operates as a public benefit corporation but is owned by a nonprofit foundation. 

Change.org has faced intense scrutiny over its use of donated funds

After signing a petition, Change.org asks you to ‘become a hero’ by donating money. People often donate, thinking that the money goes to the petition’s organizers. However, change.org takes the money to offer more visibility to the petition. 

Change.org says that the money helps ‘cover the costs of distributing the petition to hundreds, thousands, even millions more people in the Change.org community, many of whom go on to sign the petition.’

The company says that its system gives the petition a greater chance of winning. It further states that it clarifies how it will spend contributors’ money. “The amount of money you want to give correlates to the number of times we’ll display ads for the petition,” change.org’s website. 

This system created an uproar following the change.org petition to get justice for George Floyd. George passed away at the hands of a now-convicted police officer.

Contributors to the petition complained that change.org didn’t make it clear that donations go to the company. Most donors believed that the money would go to the organizers or George Floyd’s family. Aggrieved donors protested that Change.org declined to reissue the funds.

A Twitter thread clarifying Change.org’s donation model. In the comments section, many users complained that they’d felt duped. “I saw the request for a donation and of course wanted to help the cause and it wasn’t until after I donated that they mentioned that the money would be going towards ‘promoting’ the petition,” Chryss, a Dubai resident, told Business Insider. 

Some former Change.org staff told Civil Society News that people may have donated over 6 million pounds for George Floyd. “It’s astonishing that a week on, the leadership at Change.org still hasn’t made public how much they’ve made from this, what they’re planning to do with the money and how they’ll learn from this mess of their own making,” a former UK Change.org employee said. 

Change.org reportedly pays some of its employees below-industry salaries

Change.org boasts that it has created a sustainable revenue model, and yet it pays some of its employees below-industry salaries. It prompted Change.org employees to unionize under the Communications Workers of America’s CODE-CWA Project. 

“The workers at Change.org are part of a growing movement in the tech sector,” Tom Smith, the union’s organizing director, told NPR. “Workers want a voice in decisions that their employers are making about things like wages and benefits and how diversity, equity and inclusion programs are being implemented.”

Senior content producer Sriya Sarkar said that Change.org had driven enormous change worldwide but had failed to consider the needs of some of its employees. Sarkar said:

“It’s almost like we were drawing inspiration from the very people who come to our platform to create change in their communities. We’re drawing inspiration from them by speaking up for the change we want to see internally.”

Unionizing allows workers to advocate for contractors and the improvement of working conditions and speak freely about the employers’ policies without fear of retaliation. To the company’s credit, it didn’t oppose the unionization of its workforce. 

NPR featured employees like Erni Poche, who needed to take another job to live comfortably, and Radna Nath, a product designer who earned $16,000 less than she made at her previous job. The union pledged to fight for the standardization of wages to the industry standard. 

The next battle Change.org employees face is to promote diversity in leadership positions. Per NPR, 40% of Change.org employees identify as people of color, yet the leadership doesn’t reflect that diversity. Radna Nath said:

“It can only be resolved by having diverse leaders at the table. We can’t just keep saying we’re going to do it. We need to hold management accountable. As with most companies, let alone tech companies, our leadership is overwhelmingly white. It’s time to change that.”

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