The increased use of cashless payments may be handy for consumers, but it's a headache for charities. Loose coins that can be dropped into collection boxes are fast becoming a thing of the past and this is putting traditional fundraising methods under real pressure. What's needed is a new way of donating that dovetails with how people now manage their money and this is exactly what the founders of Change Donations, Lizzy Hayashida and William Conaghan, have set out to do.
"Change Donations is the only Irish-based micro-donation company helping charities and non-profits connect with a younger generation of donors," Hayashida says. "Our platform allows donors to link their debit card, round up their transactions to the next euro and donate their digital change to causes they care about. The average age of donors in Ireland is 62 and while millennials make up 40 per cent of the working population they only account for 11 per cent of overall donations. This isn't just a local problem, it's a problem for charities worldwide."
Donors can sign up in two ways, via the Change Donations website or directly with participating charities. They can set weekly or monthly round-up limits, split their round-ups between multiple charities and turn round-ups on or off. Single and recurring donations are also possible. “Ours is the only round-up solution that leverages open banking to work with traditional banks,” Hayashida says. “This means we’re able to facilitate round-ups for most people. Our platform tethers the donor’s giving to their consumption, thereby giving every purchase a purpose.”
To help charities maximise their fundraising the company is also providing marketing support. “We discovered that many charities have limited staff and resources and struggle to market their cause,” Hayashida adds. “We have created a marketing centre with the tools to build an online presence without needing to dedicate additional resources to doing so.”
Unlike traditional round-up services, Change Donations is taking a B2B approach by partnering with charities, schools, and sports clubs to offer its donors a portfolio approach to giving. Change Donations is free for donors while its partners pay a charity platform fee of 15 per cent.
Hayashida and Conaghan met while studying for an MBA at Trinity College and Change Donations began as a course project. "We wanted to create a business with a positive impact and the cashless society is rendering many traditional fundraising methods obsolete," says Hayashida. "This can clearly be seen from the Central Bank's decision to remove copper coins from circulation. Since 2015, €37 million worth of copper coins have been removed. As a result, 70 per cent of charities and nonprofits have seen a significant drop in cash donations."
Hayashida and Conaghan come from quite different professional backgrounds. Hayashida’s career to date has been spent in the busy world of US start-ups in New York and San Francisco. She was an early employee of Milo.com (subsequently acquired by eBay) and was then involved in the launch of the first same-day delivery pilot, eBay Now. Her primary degree is in economics. Conaghan is a finance graduate and a former financial analyst with Nasdaq where he managed $100 million (€91.2 million) in assets for the global technology department, was involved in acquisition integration and managed the financials for the dark pool (private forums for trading securities) trading environment.
Change Donations was launched last June and employs six people. To date roughly €150,000 has been invested in the business through incubator programmes, competition winnings, founder equity, private investment and grants. The founders recently completed the New Frontiers programme at TU Dublin Hothouse and the company is now an Enterprise Ireland HPSU client. The founders have raised €800,000 in seed capital within the last year and will launch their mobile app within the next few months followed by a Series A funding round at the end of 2020.