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Small donors are clicking more with Democrats than Republicans

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SOMERVILLE, Mass. >> In an office here with all the trappings of a Silicon Valley tech firm, a band of mostly 20-something political junkies has built a formidable Democratic fundraising machine that is fueling the insurgent presidential campaign of Sen. Bernie Sanders against Hillary Rodham Clinton and leaving even Republican rivals envious.

The success of the Boston area outfit, a nonprofit organization called ActBlue, can be seen most starkly in the latest fundraising report filed by Sanders, its most prominent political client at the moment. A whopping 74 percent of the $26 million that Sanders raised came through ActBlue, an online platform that lets people donate a few dollars at a time to Democrats — and Democrats only — with just a few clicks. Eighty-eight percent of contributions to Sanders came from donations of $200 or less.

"They’ve obviously found a successful formula that works with their base," Benjamin Ginsberg, a prominent Republican campaign lawyer in Washington, said. "We don’t have something like ActBlue. We wish we did."

The speed and sophistication of the 11-year-old operation have given Sanders a huge edge in the race to gather support from smaller donors, an important test of how well candidates connect with grass-roots voters.

Sanders’ reliance on checks from small donors is all the more unusual in an election where a handful of extraordinarily wealthy families have provided so much of the cash for the campaign, mostly backing Republicans and the "super PACs" behind them. Sanders is one of the only candidates running for president without a super PAC in his corner.

It is a contrast relished by Sanders, who has called for a "moral and political war against the billionaires and corporate leaders."

Sanders’ closest rival for small donations on the Republican side is Ben Carson, the low-key retired neurosurgeon who has tapped into an enthusiastic base of evangelical voters. Almost three-quarters of the $31.3 million Carson raised through Sept. 30 came from donations of $200 or less.

But most of that money was raised through printed solicitations that land in voters’ mailboxes, a method which is much more costly than online fundraising. Carson spent more than $3 million last quarter on direct-mail fundraising alone, according to reports filed last month with the Federal Election Commission, one reason he had one of the highest rates of spending of any candidate last quarter.

The differing approaches between Sanders and Carson reflect a wider divide between the two parties. The Democrats, largely through ActBlue and the digital efforts of individual campaigns, have gained a cultural and technological edge in developing a low-cost, quick and seamless online operation — an advantage Republicans admit they largely have been unable to match.

The one exception, at least of late, appears to be Sen. Ted Cruz, who raised about half of his total of $12.2 million in the third quarter from donations of $200 or less, most of it — about $4.2 million — through digital platforms. Cruz has been one of the most successful on the Republican side in building a broad fundraising base, by bringing in big donations for groups supporting him from a few wealthy individuals while also tapping into grass-roots support networks like Tea Party conservatives and evangelicals.

Other Republicans have struggled to keep up with the Democrats in attracting smaller donors in bulk. Jeb Bush, for instance, managed just $1.4 million in donations of $200 or less — a nickel for every dollar he has raised overall.

This election cycle is something of a departure for Republicans, who were once the party of the small-dollar donor. President George W. Bush built his victories in 2000 and 2004 around small-dollar donors his campaign reached through direct mail. In his first election victory, Republican officials bragged of his support from more than 600,000 donors contributing an average of about only $100 each, far outpacing the Democrats.

But the roles are now reversed, with the Democrats — and Sanders in particular — capitalizing not only on digital technology, but also on voter demographics and cultural quirks.

President Barack Obama produced record numbers of small donors in 2008 and 2012, largely through a system built by his campaign and Blue State Digital, a Democratic-leaning technology firm. Clinton hopes to replicate that model and is working with a startup called The Groundwork, funded by Eric Schmidt, the former Google chief executive, but she has fallen well behind Sanders in attracting small-dollar donors. Only about 20 percent of the $77 million she raised through Sept. 30 came from people giving $200 or less. Her campaign has cited administrative issues and delays as one reason she has been less successful than Sanders in this area.

Republicans concede that repeated efforts in recent years to develop a fast, online fundraising network have not kept pace with ActBlue and other Democratic programs, leaving many of their presidential candidates to rely instead on old-fashioned and costly fundraising methods like direct-mail appeals.

One group that has emerged is Targeted Victory, a Republican-leaning technology firm that offers candidates digital tools similar to those provided by ActBlue and pairs them with a list of Mitt Romney campaign donors. But it has been unable to match the money raised online by Democrats.

"The reality is people are fishing where the fish are," said Abe Adams, a senior director at Targeted Victory, acknowledging that many Republican donors are more amenable to direct-mail appeals, which were used so successfully by the Bush campaigns.

Cruz recently started his own online fundraising operation, called CruzCrowd, a system that encourages small donors to bundle money from friends and associates.

"The platform basically says, ‘You too can be a bundler,’" Rick Tyler, a spokesman for Cruz, said. "You may not be rich and famous and well connected, but I bet you have enough friends to raise $5,000. We’re always looking for new and innovative ways to raise money."

The new crowdfunding system raised about $30,000 in its first few days — a decent haul, but nothing compared with ActBlue’s long-running operation. On a good day, the Democrats’ not-so-secret weapon takes in that much in 15 minutes or so.

Started in 2004, ActBlue has now built one of the most valuable databases in modern-day politics: a list of the 1.7 million stalwart Democrats who registered in its "Express" program, and provided not only personal information but also their credit cards to make donations in seconds. Many donors have set up recurring monthly payments, and the group shares the names of the donors with the campaigns.

"It was remarkably easy," said Isabelle Miller, 25, a health care worker in Portland, Ore., who said she has now given repeat donations of around $20 or $30 to Sanders through ActBlue. Her first donation came soon after she watched a speech online that Sanders had given in Portland. "It was like an impulse purchase," she said.

In the 2014 election cycle, the group — a registered political action committee — collected $326.4 million for more than 5,000 Democratic committees, including nearly all House and Senate candidates, and it is well ahead of that pace now. (The organization takes about a 4 percent cut on all donations, which covers credit card and processing fees. It relies on donations for the bulk of its funding, administrators say.) In all, it has raised more than $834 million since 2004.

Republicans have tried repeatedly to duplicate ActBlue’s record, said Katie Harbath, who was chief digital strategist for the National Republican Senatorial Committee and now works for Facebook.

"All of them have been miserable failures," she told a conference at Stanford this year.

One reason ActBlue has been so successful is that Democratic committees in Washington have effectively ceded major online fundraising to the group — something Republicans have been reluctant to do with any outside entity.

And the whole idea of a nonprofit group coordinating online fundraising makes some Republicans uncomfortable. "Everything Republicans do, we try to make money off of," Harbath said.

Whatever the reason, ActBlue administrators are reveling in their success.

Erin Hill, who started at ActBlue in 2004 at age 24 as its first full-time employee and now runs the place as its executive director, smiled when she was asked about the Republicans’ inability to duplicate ActBlue’s efforts.

"They always seem to be reinventing the wheel," Hill said. "We beat them all."

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