Back in July we posted What if Donors Could Give More Now and Pay Later? focused on the offering by a new financial tech company B Generous.
In essence the B Generous approach to increasing the size of donor gifts is to offer financing of the total gift, interest and fee free to the donor over a period of time ranging from 3 to 9 months. The donor doesn’t have to pay any money at the time of the gift and gets a tax deduction for the full amount at the time of the initial transaction. The charity receives the full amount of the donation immediately, less the B Generous fee ranging from 8% t0 16%. [See the post for more details on B Generous’ approach and offering.]
Response from Agitator readers was mixed, ranging from positively excited to a negative pronouncement that this is “neo-liberalism at its most craven.” Many of the comments focused on the fees charged by B Generous and questions about debt forgiveness or debt collection in the case of default. [ All Comments appear at the bottom of the post here.]
Among the comments was a note from the always alert Dan Kirch noting the existence of another new company—Givezy-– that has also entered the give now pay later scene. I promised to check it out. Thus, this post.
Givzey: Quite Different
Givzey, which labels itself as the “first AI-enabled financial technology company” , offers a quite different approach than B Generous when it comes to offering a give now pay later solution.
Founded by the same team of front-line fundraisers who launched and built Gravty, a firm offering a sophisticated range of donor engagement tools, I think they do themselves a disfavor using the label of a fin tech company.
Based on a series of interviews with Givzey’s founder Adam Martel, a deep dive into their offerings and some testing of the platform I’d instead label them a company built by fundraisers who understand the effective use of sophisticated technology for and by fundraisers.
First, I want to summarize Givezy’s current offering, noting where it differs from the B Generous offering I reported on back in July. Then, I’ll outline some of the ‘coming attractions’ that I uncovered during my interviews. Reasons I think this company is much more than a “fin tech” outfit.
Givzey’s Current Offering
As you’ll see in a moment, I think Givzey is far more than a give now pay later outfit. Some of their developments about to emerge publicly from their product pipeline could shake up the trade –for the better. But first, a summary of Givezy’s current offering.
- Rather than a donor feeling the wallet hit of their full donation today, payment for the gift is spread out over four equal payments, without interest, without hidden fees.
- The nonprofit receives the full gift immediately with no transaction fee.
- Givezy builds a brand-specific landing/donation page without any additional charge and connects it to the nonprofit’s CRM or database.
- Givzey makes its money from a low-cost membership or subscription similar to a nonprofit’s purchase of other software.
- Givzey assumes the risk of nonpayment. There is no debt collection.
For readers who are right now thinking that all this is too good to be true here’s what I discovered.
- Givzey uses its team’s long experience with AI and data transfer along with a partnership with iWave to instantly calculate a philanthropic score that also serves as its instant credit check. The donor is not asked for personal information like Social Security Number or other PI. In short, the donor receives instant approval without any hard or soft credit checks.
- The only fee the nonprofit pays, in addition to its subscription to the Givezy software, is whatever fee it already pays its payment processor. If the transaction is by ACH there is no fee.
- The Givezy staff is knowledgeable, helpful, and responsive. We discussed an offer I wanted to make for a client, they offered some suggestions, asked for a link and the next day delivered a ready-to-use, well-designed donation page.
Preview of Givzey’s New Releases
Customization for Nonprofit Verticals. As I was gathering information for this post Givezy announced a customized give now pay later fundraising solution for faith-based organizations. Additional customizations for other verticals –animal welfare, for example—will soon be released according to Adam. (BTW the Givzey Blog is packed with examples of ways in which to apply the give now pay later solution.
Optimizing Asking Amounts. In addition to customization for various nonprofit sectors I was particularly impressed by Givezy’s use of predictive analytics to calculate optimal giving amounts for each donor. No more of the 1 HPC, 2 HPC stuff (unless of course you want to). Rather, Givezy will calculate the optimal asking amounts based on the donor’s giving to you and to other organizations.
All this is part of a deep set of public and philanthropic data gleaned instantly from the iWave database and delivered through application of Givezy’s algorithms.
Upsell Acknowledgements. Because Givzey calculates a Philanthropic Score (“PHILO”, as in credit score’s “FICO” ) for the initial gift, the nonprofit also has the opportunity to do far more than simply acknowledge a gift. For example, having received a $200 pledge there is an option to thank the donor and indicate that because of his/her long-standing generosity they have the option of upgrading further to a gift of $200, $1,000, $5,000 –also on a give now pay later basis.
As I write this, I can think of dozens of ways this information with its deferred payment application can be used for capital campaigns, mid-level giving programs and many other initiatives. I’ll keep you posted on some of our experiments.
CRM Transaction Fees. Continuing on with things new and disruptive on the Givezy drawing board is the plan to provide the technology that will eliminate the current and standard payment processing fees that CRMs collect from Givezy and all other credit card transactions. I can already hear the gnashing of teeth at the CRMs over their cut of payment fees, but the Givezy team did it while at Gravty and I have no doubt they’ll succeed once again.
Donor base as Credit Card. I don’t know whether Adam was saving the most intriguing for last in our interview but here’s a blockbuster they’re working on. Because they can calculate the potential giving of a donor base with great accuracy Givezy is working on offering nonprofits a “credit card” with a line of credit the size of which is based on the likely annual income from that group of donors. With this in hand an organization could then draw down funds when needed without having to wait for the next round of appeals, renewals, or events.
Some Facts for Doubters
For those in doubt Givezy is offering a risk-free trial where in cases of small organizations with limited budgets they’ll advance some funds to prove to the organization the value of give now pay later. [ Contact either Adam Martel <email@example.com> or Kevin Leahy <firstname.lastname@example.org>
And for those wondering whether give now pay later will really catch hold in our sector I note the following:
- If we look to what’s happening in online retail, younger consumers have latched onto buy now pay later solutions as the “the only way they can afford their purchases,” according to the Federal Reserve Bank.
- Buy now pay later transactions will grow 77.3% this year alone and surpass $100 billion before 2025.
- In fact, a recent industry survey revealed that the majority of donors are willing to give more, and give more often, if they can make their gift in installments.
What are you planning for your organization?