How B Corp Classy Has Helped Nonprofits Raise $ 1 Billion For Good Causes In 2020

Classy is an innovative fundraising platform specifically designed for nonprofit organizations to raise money online and reach a younger generation. A Certified B Corporation, their mission is “to mobilize and empower the world for good.”

Classy works with nonprofits of every size and cause—they're now powering 6,000+ nonprofits, from Equal Justice Initiative to Team Rubicon, to the Shriner's Children's Hospital—and have powered nearly $3 billion in donations from donors in over 190 countries since they launched in 2011.

They recently hit the staggering goal of raising $1 billion in one year. I caught up with CEO and Co-Founder Scot Chisholm to find out more about this monumental achievement.

Afdhel Aziz: Scot, welcome. Please tell us a bit about Classy and how your journey started?

Scot Chisholm: We started off as a group of friends trying to raise money for cancer research because my mom had cancer when I was growing up. That snowballed into trying to find ways to get young people involved in philanthropy across a variety of nonprofit projects in San Diego. Eventually, we outgrew the jury rigged system we were using to facilitate our own fundraising efforts, and decided to build our own platform. The nonprofits we were benefiting started asking us to use our new app for their own campaigns and events throughout the year and that’s when we realized we were on to something.

So in early 2011 we re-launched as Classy the technology company, opening up the platform to any 501c3 organization in the United States. Today we work with over 6,000 nonprofits organizations - from the smallest volunteer-led organizations to some of the largest NGOs in the world. But for all of our nonprofit partners, the theme is the same - our software helps them create a better online giving experience for their supporters, donors and fundraisers, and build a more sustainable revenue model so they can accelerate their impact.

Aziz: And we heard you achieved a big milestone recently - over $1 billion raised on the platform in 2020. Congratulations! What do you think has been key drivers of this - was it the wake of COVID-19 and Black Lives Matter this year?

Chisholm: Well the events of 2020 definitely had an impact on giving. About 25% of the folks who took our “2020 Why America Gives” survey said that the pandemic has caused them to give more this year.

But 2020 had some tremendous challenges for nonprofit organizations. First off, the cancellation of in-person fundraising events put tremendous strain on many organizations, especially those that weren’t diversified enough in their fundraising efforts, or mostly relied on traditional off-line methods. Second, much of the world’s attention and funding went to direct COVID relief organizations - certainly not a bad thing considering the situation, but it put further pressure on the tried and true small nonprofits in our community that are key to the fabric of society.

But then an amazing thing started happening. Most of the organizations we partner with, and many new ones, were almost forced to do things differently and more creatively. They started coming up with all sorts of new ideas to fundraise online - from virtual events to subscription giving - to fill the void.

So while the need for online giving definitely wasn’t a new concept in 2020, the pandemic accelerated the trend from traditional off-line methods, like direct mail, to online methods, like peer-to-peer fundraising and crowdfunding.

Aziz: Do you think that it also reflects a big shift into the ’Netflix-ization of giving’, with more people comfortable with shifting to a recurring donation model?

Chisholm: Absolutely - we call this trend subscription giving. Now over 15% of the total giving on the Classy platform is done by donors who “subscribe” to our nonprofits, pledge to give on a consistent and recurring basis. This is great for the nonprofit organization because it leads to a more predictable and sustainable revenue model. And it’s also great for the donor, because the organization needs to work to maintain their recurring support, so they tend to get a better experience, similar to what’s played out in other industries with subscription models, like Netflix, Spotify or even B2B SaaS. In most cases recurring donors give less on a dollar basis vs. one-time donors, but they stick with the organization longer, making their support over 5-times more valuable.

Recurring revenue really is the lifeblood of any sustainable and scalable organization, and the nonprofit space is no exception. So we’re strongly encouraging any nonprofit looking at their fundraising strategy in 2021 and beyond to prioritize subscription giving. It’s the future, and it’s where we’re really focused from an innovation standpoint.

Aziz: Congratulations also on the B Corp Certification! Why was that so important to you?

Chisholm: We’ve always believed that the purpose of business is to deliver meaningful value to the world, not just to make money. Becoming a Certified B Corporation was a way to further align our values with our business decisions and corporate governance. It also gives us a roadmap for how we can continue to improve as a stakeholder-minded company and find ways to further increase our value and impact in each area such as customers, team, investors, community. This has shown up in many ways over the years, from our annual impact awards, the Classy Awards, to our nonprofit educational conference, the Collaborative, as well as our employee volunteering and fundraising program, ClassyGives.

So it’s not a huge change to our day-to-day, but it’s important to solidify the values that we’ve always held dear and put the guardrails in place so that future leaders - say in 10, 20, 100 year from now - carry things forward in the right way.

Aziz: Finally, I must ask - what does Ron Burgundy have to do with your name?

Chisholm: Ha! Well, when we were coming up with the name for our very first fundraising event to support the American Cancer Society, which happened to be a pub crawl, the movie Anchorman with Will Ferrell was playing in our apartment. My buddy Pete turned to me and said, why don’t we name the event the “Stay Classy Pub Crawl”, because of his signature line in the movie “You Stay Classy, San Diego” - never in a million years thinking it would ever go anywhere.

10+ years later, we no longer have “Stay” in our name, but the legend lives on! From Anchorman inspired conference rooms (like “Milk was a bad choice”) to an internal analytics dashboard we named Baxter. I could be wrong, but I’m pretty sure we’re the only company on Earth that was born out of a pub crawl and the movie Anchorman! It reminds us not to take ourselves too seriously and to laugh when the going gets tough.