It turns out that those smiling twenty-something non-profit workers we always see on downtown streets talking to passer-bys about giving money actually bring great return.
Despite what one can only assume as a rather discouraging job at times, these social outreach workers that always accost us downtown, or “street canvassers,” raise more net money for their charities than other marketing channels.
But there’s a problem, said Paul Rowland, a cofounder of Montreal-based startup I Can Go Without.
“It’s a good return for the charities and it’s a good method of fundraising, that’s why it’s so popular,” Rowland told Techvives. “But if you think about it, it can’t be amplified.”
If Paul gives his $10, he doesn’t really know where it’s all going. As well, if he’s an isolated donator on the street, he can’t tell all his friends about what he just did and why they might want to as well.
Founded in 2011, I Can Go Without is a micro-donation platform currently for iOS that allows users to reduce their own personal consumption in favour of someone else who needs it. Micro-donations made on the app go towards local, national and international nonprofits like Moisson Montreal, Breakfast Clubs of Canada and Oxfam.
The company has been mainly bootstrapped thus far, aside from a small private investment. The plan is to grow the user base, go after a round of funding and ideally roll out more products that facilitate social giving.
Like countless other startups the idea came as a result of coffee between two friends, but this particular morning wasn’t too pleasant. It was 2011 and cofounders Rowland and Scott Lancaster couldn’t believe that widespread famine in Africa was still such a predominant issue. “We couldn’t believe it, is this really happening again?” wondered Rowland. “There’s a million people on Facebook, so we thought, imagine if today we all went without a coffee and gave the money to what was needed, and this light went on in our heads.”
Nonprofits and charities may have great intentions but often it comes down to how sustainable their projects are.
On a macro level we’ve all heard horror stories about the outrageous discrepancies between the amounts of money some charities raise and the actual amounts that go to aid. CNN reported that just 2.5% of the $127.8 million raised by Kids Wish Network went towards aid. On a micro level, charities can struggle with overhead. It can cost them a lot to raise money, especially after the costs of marketing. I Can Go Without is a business, but it only takes 6.9 cents from ever donor dollar, or “way under what they’re spending now,” according to Rowland.
Today charities are spending anywhere from $0.12 per every dollar raised to $0.50, with $0.20 marking the average. Suddenly under seven cents doesn’t seem like a bad deal. Rowland called it a “win-win” while noting that the company eventually wants to get to the point where they can give 100% of the donations.
“They’re not experts in building and using social media to amplify the donor base, so we’re saying to them ‘hey, work with us and we’ll reduce your cost of donor acquisition.’” He said. “We’re actually saving them money by helping them raise money.”
For users of the app who fear that the selected charities may themselves still be irresponsible with donor dollars, Rowland said the startup only works with charities with at least 80% efficiency rates. “We want to work with those organizations that aren’t draining their funds into huge salaries or wasting money on marketing things that aren’t actually solving the problems,” said Rowland.
Nevertheless, the very fact that this startup is urging the public to give money while actually making money off of that charitable deed does seem a bit fishy. But one conversation with Rowland gives the feeling that I Can Go Without’s intentions are beyond good. He reiterated the fact that every dollar given to a nonprofit has a cost, and I Can Go Without’s function is simply to reduce that cost.
The company’s ideal scenario a few years down the road is to be looked at as a major influencer and contributor to solving such solvable problems as clean drinking water, malaria and river blindness. If recycling has now become a normal weekly behavior among people, giving back can be too.
“We would love it if people’s weekly behavior is ‘what did I give back this week,’ because that actually has an impact and that’s what we’re doing with our app,” said Rowland.