< home Success begets success. Except in the case of Pallotta TeamWorks, the creator of an impressive new model of fundraising. Pallotta's success inflated the company's brand and eclipsed the real value sought by the altruistic participants.
			Pallotta TeamWorks is the company behind the initial success of fundraising events such as the Breast Cancer 3-Days and the AIDSRide. As a for-profit fundraiser, it worked on behalf of charities to create and operate events that drew attention and funds to these charities' causes. By embracing the modern marketing, design, and business practices that charities had been ignoring, Pallotta TeamWorks (PTW) raised over $69 million for charities in 2001, it's tenth year of operation. Then in August of 2002 PTW closed the doors on its headquarters in Los Angeles, no longer able to operate a viable business. So what happened? Simple economic analysis reveals the cause of this successful company's downfall. Funds given to charities are used to pay for scientific research, meals for the needy, or phone service for a support line. But while these may be what the funds are used for eventually, the actual value generated for the donor of the funds is an emotional one — the pleasure of altruism. As PTW became more and more successful it began to promote its own brand so heavily to fundraisers that the brand began to interfere with and block the altruistic pleasures being purchased by the fundraisers. As a result, the company became an easy target for determined detractors while its many clients defected in droves.
			Pallotta TeamWorks annual total income from fundraisers (in millions)	The flow of value from individual contributors to their cause.
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	Copyright 2005 Brandon Schauer | last updated: January 2005