Where's the Money?

The office on Arrow Street looks more like a trendy loft apartment than the headquarters of what is rapidly becoming one of the most influential Web sites in America. The open space, once an architecture studio, is buzzing with activity. The sound of phone calls and typing fills the air, and the staff—composed mostly of 20- or 30-somethings in casual office garb—is busy at work.

But the company isn’t just another bunch of hackers programming without a purpose. And their “product” is neither a commodity nor a service—it’s democracy.

Welcome to ActBlue, what its founders, Benjamin A. Rahn ’99 and Matt S. DeBergalis, call “the online clearinghouse for Democratic action.” In just a few years, the site has channelled tens of millions of dollars into Democratic campaign coffers nationwide, becoming the financial backbone of the “Netroots” movement that has sprouted up following the presidential campaign of former Vermont Governor Howard Dean.

While much has been written about the blogs and other media that form the core of the online progressive movement, ActBlue is adding the muscle that proves that vocal bloggers are more than just a bunch of kids ranting on the Web. While harnessing the energy of the Netroots, ActBlue is trading in the currency of old-school politics: cash, and lots of it.

But as equal parts technology whizzes and Democratic money men, Rahn and DeBergalis want to do more than revolutionize how politics is financed. Indeed, they see themselves as part of a broader force, one that seeks to democratize politics as it Democratizes America.

THE REVENGE OF THE NERDS

Before their site launched in the months before the 2004 presidential election, ActBlue’s founders lived lives divorced from politics.

In fact, Rahn and DeBergalis didn’t meet at a political rally or a campaign event, but at “geek camp” when they attended the Research Summer Institute (RSI) at MIT in the summer before their senior years of high school. The year was 1994, a full decade before they founded ActBlue.

Rahn attended the prestigious Thomas Jefferson High School for Science and Technology in Alexandria, Va., while DeBergalis grew up in Indiana and attended high school in San Juan, P.R. As an undergraduate, Rahn lived in Quincy House and joint-concentrated in math and physics, while DeBergalis studied computer science at MIT. (During his time there, he became good friends with Kathy Paur, a math whiz in her own right who would eventually marry Rahn.)

While he was not directly involved in politics during his time at the College, Rahn did help push through reforms allowing departmental courses to be approved for Core credit, saying that he has “always had the sense or inclination towards trying to change things at a systemic or political level.”

But his passion for grassroots change remained distinct from his academic career: after graduating, Rahn enrolled at the California Institute of Technology to pursue a doctorate in theoretical physics. DeBergalis stayed on for an extra year at what he calls his “really good trade school,” earning a master’s degrees in computer science before starting his career at Cambridge-based technology companies.

CHANGING LANES

But shortly after graduating from MIT, DeBergalis found his interest in his work waning. “So much of it is so divorced from anything in particular,” he says of his time writing code and running scripts. “I could never explain to my mom what I did or why she couldn’t buy what I wrote.”

DeBergalis found a more hands-on pursuit when he decided to run for the Cambridge City Council in 2003. Though at 26 he was the youngest candidate in the race and had virtually no experience in politics, DeBergalis—who was better known to Cambridge voters as “DeBerg”—turned his age into an advantage by intensively courting the youth vote. His platform spoke directly to college students and recent graduates, focusing on issues such as increased late night transportation and extended restaurant hours.

By making numerous trips to Harvard Houses and the Yard in hopes of creating—and then winning—a demographic of student voters, DeBergalis successfully registered 800 students from Harvard and MIT.

But in the end, DeBergalis would come up short, even as he won more “first-place votes” than one of the candidates who was ultimately elected. Cambridge’s distinctive method of voting did him in because after the “transfer votes” were counted, DeBergalis had dropped  from ninth to tenth place, and out of a council seat—a result of the fact that he had little of a following outside of the two elite universities.

Even as he came up short, DeBergalis made his mark on the local political scene: his loss ignited a debate over Cambridge’s electoral system, which some criticized for favoring incumbents. His fresh campaign style also brought new attention to the oft-ignored college student demographic. Glenn S. Koocher ’71, a veteran political analyst who was once a Crimson writer, said during the subsequent election that he didn’t “see anyone out there running that kind of a grassroots campaign, mobilizing voters as DeBergalis had done.”

DeBergalis, for his part, didn’t let the loss dampen his enthusiasm for shaking up the political scene. After the results were released on election day in 2003, DeBergalis wrote to his supporters in his LiveJournal: “You threw out the old political equation in Cambridge, and we all get to decide what to replace it with.”

In 2005, DeBergalis would endorse reformist candidates for city council; and though he had left the local political scene by 2007, he hadn’t lost his interest, showing up at the Cambridge Senior Center on election night to watch the counting of the votes, and expressing support for urban planner Sam Seidel when he won a seat on the council.

STARTING BIG

For DeBergalis and Rahn, changing Cambridge’s political equation was only the beginning. Shortly after the election, Rahn left his doctoral program at Caltech and joined forces with his old friend to bring reformist progressivism to a larger audience. The two created ActBlue, a venture that represents a cutting-edge—and most importantly, democratic—approach to politics and fundraising.

The most basic function of ActBlue is enabling people to donate money to their favorite candidates online, and in small increments. Students and others who can only afford to make small donations can do so with the click of a mouse, allowing them to become active in the political sphere that they would otherwise have difficulty accessing.

And beyond serving as an outsourcing company that processes political donations for technologically ill-equipped campaigns, ActBlue allows individuals to create their own personal “fundraising pages” to raise funds for a slate of favored candidates. Through these pages, ActBlue users can network and organize events to spread their cause. What the technology system Scoop did for liberal blogs—turning them into online communities by allowing individuals to create personalized pages—ActBlue soon did for the world of online fundraising.

“There’s no doubt that online fundraising has changed the composition of contributors,” says government professor Sunshine Hillygus. “It makes it easier for the political junkies to take their political engagement up to the next level and make a contribution.” Hillygus add that the Web site allows people to donate to candidates who will use donations more effectively, allowing donors to get more “bang for their buck.”

While 2008 has been the year of the small donor—Democratic frontrunner Barack Obama has financially swamped Hillary Clinton largely due to the fact that he can return to his army of donors  who give gifts of under $50—the cost of processing such micro-donations is often prohibitive for smaller-scale campaigns, given the high processing fees for credit card payments.

ActBlue gets around this obstacle by bundling small donations made through the site and writing one check to the campaign. People can donate to virtually any Democratic candidate, no matter if they’re running for president, Senate, House, or governor or state legislature in one of the 25 states without state restrictions on campaign finance.

With billions of dollars flowing through the political system each year, many Americans subscribe to a cynical, dressed-down version of Max Weber’s fear of plutocracy: since politicians turn to the well-heeled to finance elections, they are likely to care little about the interests of the masses.

In the 2006 midterm elections, for example, successful candidates for the House of Representatives raised an average of $1.3 million, while candidates elected to the Senate raised just under $9 million. With a projected price-tag of well over $1 billion for the 2008 presidential election, many wonder whether there is just too much money floating around in politics.

But to Rahn and DeBergalis, the answer is a clear “no.”

DeBergalis can recite a list of statistics—the annual American ice cream market is $12 billion, and the annual video game market is $20 billion, for example—that make the amount spent on elections look like pocket change. “We are competing, and losing badly, in my opinion, for the attention of people compared to all the other things that can occupy your time and money, ranging from entertainment to goods that you like to buy,” he says.

Rather than reduce the amount of money in politics, the pair would rather flood it with so much money from small donors that the effect of a comparatively small number of fat cats is minimized. One hundred dollars here and there may not seem like much given the astronomically increasing costs of financing campaigns, but that $100 multiplied by, say, 1,000 people can quickly make its mark.

And their emphasis on small donations—based on the innovative personalized approach—is working. Though it launched in 2004 with only $30,000 of “seed money,” the site has grown so popular that it raised $800,000 for Democratic candidates in a single day on March 31. By the end of this election cycle, ActBlue says that it will have channelled $100 million to Democratic candidates.

One of its most resounding success stories was the 2007 elections for the Virginia state senate. After going through the organization’s training program on how to tap into established online fundraising networks, Virginia Democrats raised over $600,000 through ActBlue.

In the election, the Democrats ended up overturning a longstanding Republican majority, and now control the chamber by the slimmest of margins.

OLD FRIENDS

Rahn and DeBergalis emphasize that their work is not all about money, but that fundraising just happens to be one of the more effective ways to help people advance their political beliefs. To this end, ActBlue is planning to allow campaigns to see not only how much money a donor has contributed, but how many hours he or she has volunteered—knocking on doors, making phone calls, or putting up posters.

The duo’s emphasis on all forms of politics rather than just finances is reflected in ActBlue’s home base: it’s not in the nation’s capital, but near thousands of the sorts of young, idealistic college students that they hope to inspire.

Rahn’s role as a tutor in Pforzheimer House ties him even more tightly to the College community, so much so that he chose PfoHo as the location of his wedding to Paur in September 2005. (The couple’s online wedding registry, www.benandkathy.com, looks like an iteration of the ActBlue platform—guests can donate online to various gifts such as “Kathy’s fancy-shmancy ice-cream maker” or their not-yet-conceived children’s educations: “We think it’s never too early to not count on winning Intel/Westinghouse...,” they write, in classic nerd form.)

John M. Sheffield ’09, who has lived on Rahn’s and Paur’s floor for the past two years, attests to his tutors’ presence in House life. This past Super Tuesday, for example, Rahn created a Web site to update students on the results of the race. And that’s not the extent of Rahn’s supposed abilities: Sheffield says that “one time he wrestled three or four bears to death in Pasadena, California,” though, truth be told, neither the bespectacled Rahn—who usually dons Steve-Jobsish black turtlenecks—nor the more laid-back, hoodie-clad DeBergalis looks like he can take a bear, let alone three or four.

RED AND BLUE STATES

Of course, Rahn and DeBergalis don’t really care about taking on bears: the only animal they aim to do battle with is the Republican elephant.

Using the Internet as a tool in political organizing has served the Democratic Party well, allowing it to surpass the Republicans in fundraising for the first time in recent history and giving candidates sophisticated tools with which to build grassroots organizations. While Republicans have tried to copy the online organizing model, they haven’t been nearly as successful. In fact, Obama has used his Web-driven fundraising apparatus to bring in more campaign funds than all of the candidates for the Republican nomination combined.

The ActBlue guys, of course, have a perfectly deprecating explanation for why the Democrats have thus far outclassed the Republicans. “I’m not sure that the Republican Party would find this technique as valuable,” DeBergalis says. “I’m not sure that they want to empower people in quite the same way.” Not that DeBergalis is complacent: he says that Democrats “have to keep investing in this type of innovation, or Republicans will catch up and find a way to use the Internet for their own nefarious ends.”

Within the party, ActBlue’s central aim is not to help big-name candidates like the presidential contenders, it’s about getting the word out for the lesser-known Democrats with strong, innovative ideas. Much of the $43 million has gone to the campaigns of people such as Daniel K. Biss ’98, who is running for state representative from Chicago’s affluent and liberal north suburbs.

Biss, an old friend of Rahn and DeBergalis from RSI, is a professor of mathematics at the University of Chicago. On his thirtieth birthday, his wife, Karin Steinbrueck, a graduate student at Northwestern, started her own ActBlue page and asked supporters to donate $30 each to her husband's campaign. It worked. She raised $1,582 on her page alone, and contributed to Biss’ ActBlue fundraising total of over $70,000—an incredible online haul for what is an otherwise obscure race.

And the staff of ActBlue doesn’t assume that everyone is well-acquainted with such fundraising methods—or the elements of running a political campaign. DeBergalis says that one of the “most valuable” things the group does is provide someone “on the phone who understands how elections work.”

“Ben and Matt implemented ActBlue in a way that incorporates all those layers of idealistic thinking with incredibly solid engineering and amazing political staff who go out and teach people to use ActBlue,” Paur says.

ROCK THE VOTE

The strength of ActBlue, the pair insists, lies not only in its superior technology or its ability to raise gobs of cash, but in the fact that the site serves to translate into action what they think is a latent desire for a better country.

Though Rahn recalls that DeBergalis was told he looked like a “kernel hacker” at a career fair, DeBergalis notes that his computer training wasn’t a waste of time. “The specifics of what you’re studying are just not remotely comparable to who you work with, how you learn to think, how you learn to work hard, and all those other things,” he says.

The Internet, the great equalizer, has empowered people to act—be it by donating money, time, or even running for office. Rahn and DeBergalis have emphasized this message particularly at schools like Harvard and MIT, where students are equipped with the resources and education to effect change.

“No one should tolerate the world as it is,” Rahn says in summing up the ActBlue philosophy, not “if they can make it better.”

—Staff writer Jun Li can be reached junli@fas.harvard.edu.