Get to know a Toronto startup: Giveffect
Imagine a platform that would let you start a crowdfunding campaign to raise donations for your favourite charity. One that would let you spread the word and really take advantage of all the online social influence you've been so busy trying to build up and use it to make a difference. That's what Giveffect is all about, part crowdfunding platform, part social network, the company is out to change the way charities and the next generation of donors engage with each other.
The Toronto-based, three month old company has already brought on some major charities like War Child and the United Way to be part of their platform and have many more in the works.I recently had an opportunity to chat with CEO Anisa Mirza about how Giveffect plans to turn the traditional fundraising model upside down.
How does the platform work?
We're a crowdfunding platform built exclusively for charities, but when we designed Giveffect, our audience was the next-generation donor. We were thinking of up and coming young professionals in their thirties, twenties, and even teenagers and how they would want to be involved.
Essentially, we're a Kickstarter meets Facebook. The idea is a charity signs on for free and an individual comes and says I'm looking at this charity, I want to give back and I want to start a crowdfunding campaign. They can then launch a crowdfunding campaign in support of any of the charities.
The funds go directly to the charity not the individual, and tax receipts are issued to the donors on behalf of the charity by Giveffect. Both charities and donors have their social profiles where they can update their statuses and engage with others, while on the backend we provide powerful analytics to help them gauge what works and what doesn't.
How are you different from other crowdfunding platforms?
We correct for some of the existing problems with using crowdfunding in the philanthropy world. For example, when you go on to Indiegogo and launch a campaign in support of a charity, the funds go to you. What's happened with some nonprofits is they've let a volunteer host a crowdfunding campaign for them, funds were raised, but they never saw the money. It's unfortunate, but it does happen. With us, the money goes directly to the charity.
Secondly, for some of these other platforms tax receipts are a major issue. Say you're an honest person and you've raised funds on a crowdfunding platform for a given charity and now you're going to give those funds to them. That charity cannot issue tax receipts even if the individual has a list of all the people who contributed. Because the charity has no way of guaranteeing that those funds were given by those people, by CRA methods, they're not eligible to receive tax receipts.
Lastly, we all know that when it comes to fundraising, relationship building is the most important thing. The biggest misfortune with using existing crowdfunding platforms for philanthropy is that a charity does not receive any sort of relationship building tools or benefits from the campaign.
What are the relationship building tools that charities receive from Giveeffect?
All the data from a campaign, everybody who donated, their age, demographics, their integrations with Facebook, Twitter, where the traffic came from, how many shares they received, every single piece of information is made available for charities.
That's information that's really important. Not only do we give charities demographic data, but we also give social media traffic. We also answer questions like where is your traffic coming from? What's the conversion rate? We have social profiles for each charity where they can update donors with info about what the funds are being used for while individuals also have profiles that showcase the causes and charities they're most passionate about.
How do you make money?
6.2% of all donations raised at the end of a campaign go to Giveffect. That payment includes all the analytics we provide for charities, the entire donor demographics, the crowdfunding platform itself, tech support, on-boarding help, and everything else is included in that.
What's up next?
At this point we have 30 charities on the platform. We have 80 signed up, and we're on track for 100 by the end of the month. We have some of the largest charities engaged with us. There are about 80,000 registered charities in Canada. We hope to secure about 3,000-5,000 charities by the end of the year and expand to the U.S. in half a year or so.
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