CFA: Crowdfunding explained

PROVIDENCE, R.I. (WPRI) - Rising medical costs associated with life-threatening illnesses and unforeseen accidents have more people turning their computer and a little kindness from strangers.

It's called crowdfunding.  The fundraising tool once popular to finance creative startup projects is gaining momentum in the nonprofit sector.

"Our medical, illness and healing category is the most popular area of usage," said Brad Damphousse, co-founder and CEO of GoFundMecom.

Mandy Sheridan turned to crowdfunding after her son Madden was born with a rare genetic disorder. 

He needed multiple surgeries to stay alive and the costs were overwhelming for his family.

His mother is one of thousands sharing their stories on crowdfunding websites where friends, family and even strangers pitch in.

Anyone can set up a campaign for free.  Just write up your story, add photos or video and then send out the link to social media contacts.

The money is collected through the websites, which takes a small cut per transaction.

Donors should still be cautious.  Although the sites have systems in place to prevent fraud, it is still possible for scammers to slip through the cracks.

Damphousse recommends you donate only to registered charities and to friends, or friends of friends.

Unlike other crowdfunding websites where you have to meet your monetary goal before the project is funded, cause related crowdfunding money is available for immediate use even if you don't reach your goal.