1 year ago
Few fundraising firms have experienced as dramatic a fall in recent years as Mothership Strategies.
Once considered a juggernaut in the Democratic digital space, the firm is no longer in mainstream politics following fierce criticism over its aggressive fundraising tactics and allegations that its huge money hauls were being funneled back to the company itself.
But rather than disappear from the political scene, Mothership has found a lower-profile roster of clients, primarily political action committees not affiliated with politicians. And campaign finance records, interviews, and communications from the firm show that it’s continuing to collect significant fees while deploying the very same aggressive business practices — such as sending fundraising emails with catastrophic, eyebrow-raising language — that gave it pariah status in the first place.
The group’s second act is raising new alarms among Democrats who fear that those methods draw money away from campaigns and other liberal causes. They also worry its actions hurt the progressive community’s reputation more broadly and threaten to send the entire industry into a race to the bottom.
Mothership was paid over $50 million during the 2022 midterms, according to money-in-politics watchdog group OpenSecrets. That total is a substantial portion of what it helped clients raise.
All told, roughly 38 percent of donations raised by Mothership clients have been fed back into the firm’s fundraising machine as direct payments to the firm or other costs for its services, according to the firm. That’s high for digital fundraising, according to others around the industry. One competitor said the figure is usually somewhere between 10 to 20 percent.
“I can’t imagine that the donors that are giving money to these groups will think that the money is going in large part to Mothership, rather than the actual PACs or individual candidates,” said former FEC chair Ann Ravel, a Democrat, in an interview. “It is definitely unethical, since the whole point of contributions to political organizations is not to support the firms that are doing the fundraising but to support specific people for office or legitimate political causes.”
Mothership’s strategies do generate large amounts of money for its clients. And the hyperbolic emails it sends and high fees it charges are legal. Mothership argues that the current state of politics calls for its dramatic pleas for cash. The firm defended its pricing structure, saying that most of the client money it receives actually passes through to other vendors.
“The money we’re raising for our clients is beneficial for the Democratic Party and the progressive movement because it’s having such a large impact on races across the board,” said Jake Lipsett, a founder of the firm.
Lipsett said that in the 2022 cycle, Mothership’s clients spent nearly $20 million on independent expenditures in competitive races, donated over $6 million to campaigns, raised nearly $15 million for House and Senate campaigns, and deployed over 4,000 organizers.
Mothership’s approach has long been to write emails with alarmist subject lines or urgent pleas for support. They asked for donors to chip in to stop Republicans from forcing Transportation Secretary Pete Buttigieg to resign (which wasn’t happening) or to “DESTROY Trump’s extremist Supreme Court.”
But the company took a reputational hit after the Washington Post reported in January 2019 that its often inflammatory messaging had become controversial among Democratic operatives.
Campaigns began parting ways with the firm, including Sen. Jon Ossoff’s (D-Ga.) and Rep. Steven Horsford’s (D-Nev.).
“We don’t like to trick voters,” said a former staffer for a congressional caucus PAC that used to work with Mothership, who spoke anonymously to be candid about a former business relationship. The firm’s practices were “a little predatory,” the staffer said.
No campaigns have paid Mothership since April, according to FEC records.
Between January and April of this year, the campaigns of Reps. Mark Pocan (D-Wis.), Pete Aguilar (D-Calif.), and Raul Ruiz (D-Calif.) paid the firm a total of $33,600. The leadership PAC of Rep. Steny Hoyer (D-Md.) is also a client, and the leadership PAC of Rep. Pramila Jayapal (D-Wash.) paid the firm a little over $765,000 — about two-thirds of the total money it raised in 2023.
At one point, Mothership had about 25 campaigns as clients, according to co-founder Greg Berlin, but the downtime in a campaign cycle made it difficult to build a sustainable business model. He said the firm slowly ramped down its campaign work.
Mothership’s main clients now are little-known PACs like Stop Republicans, Retired Americans PAC and Progressive Takeover, which largely focus on voter outreach or progressive policies instead of campaigning on behalf of candidates.
That reliance on PACs is unique among progressive fundraising firms, which usually tout a mix of campaigns, political action committees, or other Democratic-aligned groups on their websites.
With a new set of clients, Mothership has continued its aggressive fundraising tactics and high fees. FEC records show the firm has been paid about $13 million this year.
The firm said it doesn’t keep most of that money. Nearly 58% of payments from Mothership clients this year have been passed on to pay other vendors for work such as advertising, Berlin said. Mothership itself has kept about 16% of what it’s helped clients raise this year, he added.
Mothership clients end up paying back about 38% of what the firm helps them raise.
“They’re funneling money away from races that we really need to win, so the money’s not going to organizers and to convert voters,” said Mike Nellis, who runs another Democratic fundraising firm, Authentic. “And then secondarily, the tactics firms like Mothership use are often slash and burn designed to scam and scare people, which makes it harder for everybody to raise money online.”
Mothership said its fees vary by client and that most of the funds paid to the firm are actually passed on to other vendors for advertising, acquisition, and other costs. But in certain cases, its clients have ended up either sending huge amounts back to the firm or in difficult financial straits. Brady PAC, for example, found itself fighting a more than $600,000 debt it owed to Mothership that it negotiated to be significantly lower. The pro-gun control group has been paying the firm back in $14,000 monthly installments, according to FEC records. Brady PAC declined to comment.
Progressive Turnout Project has paid Mothership more than $3.7 million this year while raising $11.5 million. (That fundraising haul includes $2.6 million in transfers from affiliated PACs that are also Mothership clients.)
The National Democratic Training Committee PAC paid Mothership $1.6 million, or about 26% of the $6.3 million it raised this year. The firm was paid almost $600,000 from Retired Americans PAC, roughly 44%, of total receipts of $1.4 million this year, while Moms Fed Up paid Mothership about $491,000, or about 42% of its $1.2 million in total receipts.
Progressive Turnout Project said in a statement that Mothership had helped it “raise far more for our programs than we could have ever imagined,” and Retired Americans PAC called the firm “responsive and collaborative.”
Direct comparisons are difficult because other fundraising firms’ work is more varied, including voter persuasion, which Mothership doesn’t work on. But other fundraising firms receive far smaller cuts of what similar PACs raise.
The PAC VoteVets paid the digital firm Aisle 518 roughly 17 percent of its fundraising haul. Democratic Action paid a number of campaign firms less than $400,000 in the 2022 cycle out of more than $29 million raised, according to FEC records — totaling less than 1.5 percent.
“Those Mothership boys are aggressive,” said one person who works at a Mothership client, granted anonymity to speak about a business partner. The firm’s fees are “quite robust,” the person said, but “they raise money. You can quibble over their fees, but they do produce.”
The person said they have “never understood their fees except that they’re large numbers.” And those large numbers, Mothership says, are ultimately what matters.
“Something we take a lot of pride in is out-netting anybody else in terms of fundraising. We see ourselves as the leaders in grassroots digital fundraising for Democrats, and we put our necks on the line telling folks that we’ll be able to outraise and, much more importantly, outnet,” said Berlin.
That success has fueled fears among some Democrats that others will follow in Mothership’s footsteps, given the pressures of online fundraising.
For example, Mothership was a proponent of the use of automatic recurring donations. That practice was seen as deceptive, with donors sometimes unwittingly signing up for repeat charges. But it was also highly effective in raising large sums, and others adopted the practice until the Democratic fundraising portal ActBlue outlawed the use of an untransparent recurring charge system on its platform.
But while that may no longer fly, the sky-is-falling fundraising appeals that Mothership developed has become a bedrock in political fundraising.
“How they raise money and the kind of tactics that they use has kind of just been permeating through the Democratic progressive digital space for a long time now,” said one Democratic fundraiser granted anonymity to describe industry dynamics.
Mothership carries a fair amount of influence in the party, said the fundraiser, who worries the company will drag down the broader Democratic fundraising ecosystem: “No one is holding them accountable.”
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