Interview with Soraya Alexander, COO of Classy.
We discuss the Classy State of Modern Philanthropy and dig through the data. Get the report: https://donationtrends.classy.org/
Rough Transcript
[00:00:00] George Voice Dub: I have known about this particular fundraising platform for quite some time. I’m excited to have none other than Soraya Alexander, the chief operating officer, the COO of classy. How’s it going for you today ?
[00:00:14] Soraya: It’s going great. Thanks for having me. I’m so happy to be. Yes.
[00:00:19] George: Yeah, you pop up, you know, as a definite provider of services, but also a lot of content. I see a lot of educational resources being churned out, which I, as a, as a consumer and creator myself deeply appreciate. And always I’m more interested generally in platforms that can look at their own data.
[00:00:40] And so you’ve recently created this report, but before we get into there, how do you describe in your words, uh, what class he.
[00:00:47] Soraya: We’ve got, um, a fancy brand proposition, but at the most basic level, we do digital fundraising for nonprofits. So the whole suite of, you know, main donation forms to events, to peer, to peer, um, anything that your donors, wherever your donors are going online, we’re
[00:01:03] George: It’s such a competitive landscape. I, when I, you know, 12 years ago I started whole whale. I was like one thing I will never, ever do donation platforms. It just strikes me as like an impossible field to, to kind of grow in. So how has, how has it been over at classy?
[00:01:19] Soraya: Oh, it’s been great. So I’ve been a classy for four years. And I think where we get really excited is that, you know, we’ve got several thousand customers and they are honestly, the sector is made up of the most innovative, ambitious people. And generally. They’re totally under resourced to match their ambition, right?
[00:01:38] Like that is the definition of the sector. They don’t have the resources. I don’t know how many, how many, you know, the resources you would need to solve the world’s greatest problems, but the sector definitely doesn’t have them. And so we really see a lot of promise in technology overcoming that gap.
[00:01:52] Like how can technology accelerate your efforts, amplify your efforts, get more fun, city, more good. Um, and so we’re really not cynical about, you know, what we, what we do. We see. How technology can transform the work of the sector. So I, I completely love it. The, the pace of innovation, um, the way that we engage with donors, um, has been changing a lot.
[00:02:15] So it is competitive, but that also just means we have to be better. And I think the sector deserves that. Um, so I really, it’s been a lot of fun.
[00:02:22] George: You know, it it’s good to hear. And certainly like under resourced is the, is the sad mantra of what’s going on and great that you’re able to provide the sort of frictionless way to get more money into more good hands. You have come out with the state of modern philanthropy. I was hoping maybe you could pull out what that is first
[00:02:45] Soraya: Yeah. Yeah.
[00:02:46] George: what do, what do what’s the state?
[00:02:48] Are we
[00:02:48] Soraya: , I don’t know that I have an answer. I think, uh, optimistic is probably the one word answer. So the state of modern philanthropy is an annual report. We do it’s the, the fifth year we’ve published it. And we would just kind of glean all of this information from all of the campaigns on the platform.
[00:03:05] We would collect all of these insights around donor trends, behaviors, campaign trends, payment trends, uh, and it was just too much too much information to not share it out with the sector. We thought it could be really valuable. So, you know, this past year we saw over a billion dollars of donations. Uh, it was 12 million individual transaction events, 54,000 campaigns.
[00:03:27] And so from that, you can start seeing kind of what’s working. What’s not how are things progressing? Um, so yeah, really happy to publish it. And it. Kind of goes hand in hand. We do several consumer surveys throughout the year as well. And so you marry up what are people saying about how they wanna give and then what actually happens on the platform and, um, you find some interesting, interesting insights.
[00:03:47] So yeah, excited to kind of share some of those today, but, um, please do you know if anybody’s interested, go, go through there’s there’s way too many insights to, to talk through. It ends up being, you know, feeling tedious, but we think that we’ve packaged it in a way that could be really helpful.
[00:04:01] George: Yeah. And just so folks know, we’ll have the link in the show notes, but I, I found it by going to donation trends dot class e.org. So that’s, I think where we can find this, the looking at your executive summary, which I always appreciate. The quick summary. Tell me what I need to know before I need to know it.
[00:04:19] Cuz I’m super lazy. You have that events are back. Um, so events were away, clearly events. Meaning I read this as in person fundraising events, cuz that pesky little thing called the COVID. So we’re BA we’re back.
[00:04:35] Soraya: we’re back. What, you know, so one of the things we do is because we’ve got kind of long term relationships with so many nonprofits, we’ll only isolate to year over year performance for the same kinds of campaigns and the same kinds of organizations. So this isn’t just. We started selling, you know, to a lot more organizations who are interested in events.
[00:04:52] This is actual year over year performance. Um, and we saw that revenue from events group 50% year over year. So that’s coming back in a big way. Uh, but it’s not just coming back in person. I think people got really used to virtual. Events then got totally sick of virtual events, but they held onto some of the digital components that feel easier, more elegant, more efficient.
[00:05:15] And so I kind of mentioned these consumer surveys. We did, we actually did a, a fundraiser experience report, which was a survey of donors and they talked about really. Uh, valuing when there are things like digital auctions or, you know, digital fundraisers added on to either hybrid or fully in person events.
[00:05:35] So now we are seeing about half of donors say, yeah, we wanna come back to events. Events are raising a ton of money again, you know, anybody who’s, um, You know, been in this ecosystem or frankly been in an airport, knows that like the in person experience is back, but that digital component is not going away.
[00:05:51] It’s just evolving. Uh, so that, that kind of combination we’re seeing as a, as a real transformer as we go, as we go forward
[00:05:59] George: And just to, to repeat the, what was the year over year increase.
[00:06:03] Soraya: 50%
[00:06:05] George: About a 50%. That’s pretty phenomenal. And again, just the, the sample size, I think, just to confirm is the, the total over, you know, $1.1 billion that transaction, like, so of that has a huge increase. Uh, is the, is the overall amount donated on the platform also increased in that same period of time?
[00:06:24] Or is it like the percent of money coming via? Makes
[00:06:28] Soraya: Yeah, it’s a good question. So we’re definitely, um, growing and that’s both growing through individual organizations who are growing, who are doing kind of really well with all these optimizations and different campaign types. And, you know, we’ll talk about. Um, channel optimization and payments optimization, and then it’s also growing just as our out platform grows and we’re able to support nonprofits, but for events specifically, these are events that were run the year before or organizations that were with us the year before that weren’t running events and what they did the next year.
[00:06:56] So it’s not reflective of just kind of new organizations it’s truly year over year comparison. And we’re seeing, um, a pretty drastic, uh, increase, which we find really encouraging.
[00:07:05] George: Yeah, you read my mind. I’m like, well, wait a minute. You know, the number went up, cuz our number went up and you’re like breaking news.
[00:07:10] Soraya: for it.
[00:07:11] George: organization’s numbers go up because they got bigger. So you kind of controlled for it. Looking at the same organizations. Uh, running these events. I’m curious, are these events I R L or are they a mix?
[00:07:22] Do you have that
[00:07:23] Soraya: Total mix. We it’s, it’s a complete mix and it’s even harder to what we’re seeing is either even the IRL. Very few of them are strictly in person. Now, almost everybody has introduced this digital component. They’ve, you know, really come to understand that. Why place a geographic limitation, if you don’t have to.
[00:07:43] And people in the room are happy to engage online with, you know, again, things like digital auctions, so why restrict it, or even timebound auctions, there’s no need to restrict it. You’re raising more money. If you can kind of open the aperture and it’s so easy to do now, the donors experienced with it.
[00:08:00] They actually prefer it, um, based on our donor surveys. And so, uh, we see very few pure play in real life events happen.
[00:08:07] George: the majority of these are non geofenced.
[00:08:11] Soraya: It’s it’s in person events that have a digital component that has been layered on. That’s a lot of what we’re seeing now.
[00:08:19] George: Gotcha. So there are people hanging out in person, but like, like logo, like, like I’m gonna walk around my block. I’m gonna walk around my block, like, oh, cool.
[00:08:27] Soraya: of that, or even just, we’re gonna have an in person gala, but our auction’s not gonna be a, you know, the paddle race is gonna be ver digital now. And so if you wanna phone it in, you couldn’t make the gala that night, you just really could not get outta your sweatpants. You can actually participate at alongside the people who are in the room.
[00:08:42] That’s a lot of, kind of what we’re seeing.
[00:08:44] George: Yeah, finally sweatpants for a cause I knew it was gonna come.
[00:08:48] Soraya: I am behind that. Cause
[00:08:49] George: What is the weirdest event you think classy has been, been parked to?
[00:08:55] Soraya: Oh man. You know, I need customer permission before I can talk about some of these things. I will say the coolest one was right at the start of COVID. Do you remember, um, that Robin hood telethon in New York that had. Tina Faye crying. It had, I mean, it had everybody coming forward and really like every celebrity you can imagine coming forward to raise money, um, for all kinds of relief efforts that Robin hood was doing just at the start of COVID incredibly powerful.
[00:09:21] And if you had told me that we were gonna be part of some huge telethon in, in the year, you know, 20, 20, I, I would. I wouldn’t have believed it. Um, but it was a really incredible kind of moment for everybody to come together. And we were really, really proud to work with them.
[00:09:37] George: I’d be so curious. I, I feel like I can just talk about this or parse this out almost in, in a lot of ways. What are the, I don’t know if you have this, but what are the highest yield, um, types of events? Is it, is there a certain center, like, oh, they’re running the, uh, yield walkathon or like, oh my gosh, it’s the, the silent awesome pet grooming Bonanza that like really brings in the dollars.
[00:10:00] Soraya: It’s a great question there. It totally depends on the organization, which is a really unsatisfying answer. The one thing that I will say is completely consistent is I think sometimes event organizers. Feel like the big ask is getting people to the event, getting them to register, getting them to give again, they don’t, they’re, they’re nervous to ask for those participants to also fundraise on their behalf.
[00:10:22] When you do event with fundraising on top of it, you invite somebody to raise additionally either for, you know, uh, run, walk, ride, or even just a gala. Event volume goes through the roof, always encourage your network and your supporters to do more for your cause. It, it, that is a really transformative aspect that takes very little from you.
[00:10:42] You are just activating your supporters network, um, and it’s not used as much as you’d expect. And, and really that has transformative impacts on, on how much you raise.
[00:10:53] George: So as I’m understanding this being explicit, that attend, but you’re also fundraising.
[00:10:59] Soraya: Yes.
[00:11:00] George: Don’t just show up, like
[00:11:02] Soraya: That’s right. And you think about, you know, everybody gets one more donor, you’ve doubled your event revenue. Like it’s not hard stuff. You don’t really have to ask them to become superstar fundraisers, say, Hey mom, I’m going to gala tonight. Do you wanna throw 20 bucks on top of my ticket? Um, for something that I care about your mom will.
[00:11:18] Pitch in 20 bucks. Um, and that, that can really change, right? Yeah. that changes things. Um, and it’s, it’s very low lift. It should be no lift with the right technology. Um, and, and you don’t, and, and suddenly you have all these new donors as well, suddenly mom’s part of your database suddenly you can market to her and get her as a more committed donor in the long term.
[00:11:36] So even outside of the event, you’ve expanded your network in kind of profound ways. Um, so we, we are always encouraging our, our, uh, organizations to consider.
[00:11:45] George: right. Big takeaway. Everybody. Get those mom dollars.
[00:11:48] Soraya: Get mom dollars.
[00:11:50] George: another one we, yeah, hashtag hashtag get mom dollars. Uh, donors give more when they have choices. Can you, yeah. And other news money, money buys things.
[00:12:03] Soraya: yeah, shocking.
[00:12:04] George: I don’t, I don’t mean it that way. What does this actually mean?
[00:12:07] Soraya: Well, well, so we, um, we launched a payments offering a few years ago because we heard that organizations kind of want everything consolidated. They want easier reconciliation. And so we, we launched this, this payments gateway as a, as a way to facilitate easier organization reconciliation and just reporting honestly.
[00:12:28] And then we saw the light on payments and became completely obsessed with how. Offering different payment types can really transform conversion rates, donor retention rates, even dollar amounts that you’re giving. And so as our payments offering expanded, we said, okay, let’s layer in digital wallets, right?
[00:12:46] Apple pay. Yes. You should have apple pay PayPal. Yes. You should have PayPal, Venmo, crypto ACH, which is like digital bank transfer. You start offering all these things and you see individual donation amounts go up, you see conversion rates go up, you see. Um, recurring commitments, go up, you see lifetime value of those recurring commitments extend you start adding all these things up and it starts sounding like comical numbers.
[00:13:10] So I’m not even gonna share kind of some of the things we’re seeing, cuz I am making our team go through and scrub it a hundred more times before I would share it with a public. But we will say, you know, a couple of the stats we saw, one time donations could increase 50% when you have payment options on there.
[00:13:25] And this sounds really profound until you actually take a second and say, how do I behave as a consumer? Oh yeah. If there’s apple pay, I am more likely to complete a checkout, whether it’s on a eCommerce site or a nonprofit donation form. If I don’t have to. Get up while I’m in my sweatpants, you know, watching the gala from home, I don’t have to go up and get my, you know, find my phone and find my credit card and find whatev or sorry, find my credit card, find my laptop, whatever else.
[00:13:49] So it’s really intuitive when you put yourself in the mind of a consumer. Um, and yet we, you know, we still have kind of nonprofit saying, well, I’ve got, you know, I’ve got a credit card form. Like that’s enough. You know, I, I have a means for a donor to check out that’s actually not enough. Um, and. It’s transformative when you have all of these options.
[00:14:09] And it’s also tragic when you think you’ve spent so long, getting the public to know about the cause care about the cause. Find your organization that is trying to address the cause. Get all the way to a donation form, and then still check out. Rates are. Way lower than they should be. Definitely not a hundred percent.
[00:14:26] And, and you think about how much work you have done to then lose the donor at that last moment. And if it’s kind of tragic, um, and that’s why we’ve become obsessed with payments, cuz you can start bumping that number up in kind of meaningful ways.
[00:14:36] George: Yeah, just to reiterate though, you’re saying that the average one time donation was nearly 1.5 X more just by offering these options all in one place. That’s that’s amazing. I had thought prior. To this, that probably the number one piece that impacted the amount given in that first time, one time amount was the anchoring, what the prefilled amount was,
[00:15:03] Soraya: Yeah. We’re seeing as actual payment options. It’s not just conversion rates that are impacted. It’s actually the dollars that you give.
[00:15:08] George: Wow. And, and you found, so you now accept crypto.
[00:15:13] Soraya: We do we accept
[00:15:14] George: when did that start?
[00:15:16] Soraya: a couple of weeks ago. We just launched it, um, right in the middle of crypto, winter. It’s you know, we’ll we’ll uh,
[00:15:22] George: what are you guys doing? Losing
[00:15:23] Soraya: I I know, come on over. No, I mean, the idea, what we’ve seen is the more offerings you have, we like saying that we know we have more payment options now than Amazon. Um, you know, you just, you wanna come over no matter how you wanna give, we will be there for you.
[00:15:35] We will accept. We will accept any, you know, any form of
[00:15:39] George: You accept all cryptocurrencies, all, all forms of all forms of the, uh, the doge.
[00:15:45] Soraya: Not, not everything, but more every day. I think we just, um, announced that we, we extended to another only 10 currencies just last week. So they keep coming. Um, the capabilities keep extending, um, but very early days.
[00:15:58] And I think, you know, that’s the most exciting thing for us. Um, you know, we, we did. Credit card and ACH. A couple of years ago, we layered in digital wallets about six months after that, about a year ago, no, maybe eight months ago was PayPal. Uh, then Venmos two months after that crypto, you know, was just a couple of weeks ago.
[00:16:16] So, uh, the velocity and the, the focus and the expansion here is, is continuing. And it’s really because of that value, we see the donor engagement and the reactions and the receptivity. um, so, so no plans on, on kind of slowing down, we’re running out of currencies to accept and, and payment methods to accept.
[00:16:32] But, um, as long as there’s more, we’re gonna keep, keep exploring to create, create new things. That’s it? Well, and it’s fun cuz now you get to start getting, uh, really weird about thinking. Okay. What does event, you know, we’re talking about hybrid events, we’re talking about crypto, the future of. Uh, virtual galas where you’re just auctioning NFTs, and suddenly things become really interesting is, is absolutely, you know, there are brainstorming sessions happening with some of our most innovative customers around what this can look like and how we can support it.
[00:17:00] So,
[00:17:01] George: Why did you choose to, uh, why did you choose to accept crypto?
[00:17:04] Soraya: Um, really it’s about kind of donor choice and organization choice. So our job is to be a platform that just says we can enable nonprofits to engage with our donors in any way that is meaningful to donors. And our job is to. Do a lot of kinda market assessment stay on the cutting edge of, you know, eCommerce trends, donor trends, non-profit trends and say, okay, where, where is this going?
[00:17:24] Where can we get more funds to causes that need them? And then we will have, you know, we will pursue offerings in that capacity. So it was, it was kind of an easy choice from that lens.
[00:17:33] George: and do you, uh, Do you have any organizations that are expressed to saying like, no, no, no. Like turn that off or I assume they have to turn on all of these things. It’s not default outta the box. Right? So
[00:17:45] Soraya: We do no, no, no. You have complete control over what you do, how you engage with it, what you turn on. Even at a campaign level, you can decide, you know, this one doesn’t really feel right. We don’t think it’s the right donor base. Um, but here we would like to
[00:17:56] George: But your data seems to suggest that you should check all of the boxes, like land C air, however you wanna get us there.
[00:18:02] Soraya: our data strongly suggested, but this is why we release these reports. It’s like, you know, we’ll do the analysis. You can make the decision. The choice is yours.
[00:18:11] George: I love backed insights that fly in the face of the. Common knowledge is don’t offer too many choices. You’re gonna overwhelm the person, keep it focused. Like, you know, you seem to be betraying the, the imutable laws of UX and, and sort of throwing all this.
[00:18:28] Soraya: I’m really glad you asked that. So, um, The right options are good. And so more options means you have a higher, uh, higher chance of getting to the right one for that donor. But does that mean all the donor? All those options have to be on the table for every single experience. Absolutely not. And so you’re right.
[00:18:45] We actually are working on how do you get more insights around who’s landing on the page and maybe you cater those options. To that person. So you can have the full suite enabled for every campaign, but based on what you know about a particular donor visitor, you can say, you know what, we’re only gonna show these three options.
[00:19:02] We really don’t see any indication that this person would be interested in option X. So we’ll just hide it on that page. So it’s not, it’s not live yet, but you’re absolutely right. Those are, those are things we’re exploring right now.
[00:19:12] George: be curious. Cause you just turned this on of putting all of those together. It seems that they are they’re additive and it’s like in addition to not, instead of, and I wonder with something. Like crypto, which has, uh, a polarizing effect, I think in its current cycle of adoption, which is a fancy way of saying doesn’t this piss off some folks potentially that are looking at ways to give, and they’re like, wait a minute.
[00:19:37] This organization accepts, you know, you know, climate destroying cryptocurrency,
[00:19:43] Soraya: Yeah,
[00:19:44] George: you all. I’m not giving to this organization. I, I wonder if that’s a thought or concern.
[00:19:49] Soraya: Yeah, well, the, the, the crypto argument aside, we do have kind of off offsets enabled if you want as an organization to sign up for some kind of offset program. So we do have that kind of, um, integrated as well. And then, um, I think it ends up being the, the organizations know their donor base really well, and they say, okay, um, are you choosing kind of greener crypto, you know, offerings, things like that.
[00:20:12] George: Yeah. I don’t know the right answer, but I do know that more is different.
[00:20:16] Soraya: more, more is different, more so far is really. Um, paying off and we are testing the heck out of it. Uh, and seeing, because the second it starts not paying off we’ll, you know, we’ll, we’ll publish that as well and, and give control to kind of moderate.
[00:20:32] George: Yeah. The irony to me of also the, like the crypto argument, then we’ll move on. Cuz I love rabbit holes is, is the fact that I assume that on donation. The acid is liquidated so you’re not holding it. You’re technically getting it outta the system and switching back to Fiat. So it’s, it’s kind of funny to me being like, how dare you, you know, not go green.
[00:20:51] You’re like, you know what we’re doing? Right. We’re removing liquidity from the system. You don’t like, you know how this works,
[00:20:57] Soraya: love, I love that we haven’t even pursued that angle, but, um,
[00:21:01] George: Yeah. Yeah.
[00:21:03] Soraya: It is, it is, it is early days though, and you’re right. And the, the, the thinking around it and just the, the process of producing it, everything is evolving so quickly. And so I think for us, it’s always, how do we, how do we stay on leading edge?
[00:21:16] How do we make sure that. You know, so I started my, my career in the social sector and moved into e-commerce and customer loyalty and customer engagement for the, for profit sector. And so this is kind of the best of both worlds, where I get to say, you know, I ki I have familiarity with what the sector needs and what they encounter, and I know about e-commerce and it was always, you just try to go where the, where the donor, the consumer is.
[00:21:37] You try to make it as easy for them. If you just, if the goal. Make it easy for them to spend money with you, then you have to figure out that psychology and that experience, and that is your job. And so for us, that is our job on behalf of the sector that we think needs the most. And so wherever that goes, we will, we will be there.
[00:21:54] George: Of working with, and also like talking to folks that have experience in the e-commerce sector, moving into the nonprofit sector. You’re like, yeah, go get that money. That’s how this works. That’s how all of this
[00:22:04] Soraya: that’s it. That’s the,
[00:22:05] George: get the
[00:22:05] Soraya: the job. That’s the
[00:22:07] George: overthink it.
[00:22:08] Soraya: Yeah. And you have to do that in really sophisticated ways. You know, how do you do that when you’re not, um, you know, how do you do that when you’re talking about impact, where you’re talking about long term relationships, where, you know, you have a fraction of the budget, you’ve gotta get even more creative and thoughtful and personalized and all these things.
[00:22:24] Um, it it’s so much more important. You can’t just say, okay, we’re running a flash sale on something and you don’t have those levers. Um, and so I just, I completely love it.
[00:22:31] George: We have a final point in here that fundraising among peers thrives on social media and you have this number that peer tope raise on average 3.8 times more than other time based campaigns. Can you help me parse this out?
[00:22:46] Soraya: Yeah. So, um, this is really around, you know, focusing on. Campaigns that say, okay, we’ve got, you know, we’ve got an end date. If that’s an event, you know, you’re leading up to an event you’re trying to raise money or we’re raising for a particular fund. Um, this actually goes back to the events conversation we had earlier, which is just activate your donors and your supporters networks offer a way for them to fundraise on your behalf and for time-based campaigns specifically, you see almost four times more raised when you allow people to fundraise and extend what their own wallet can do, what their own contributions can do.
[00:23:19] And then suddenly you also get all these new donors. Um, so I, there’s no reason not to allow people to do more than what you know, they’re willing to spend in that moment. Cuz they have networks who are going to listen to them. You know, this is important to you and I care about you and I feel aligned to your values and I want to support the things that you support.
[00:23:39] It doesn’t have to be, you know, their entire network to, for it, to be really meaningful for non.
[00:23:43] George: What does this actually look like? Are you saying the organization creates this peer-to-peer fundraising campaign and then sort of enables a certain feature for social share? Explicitly says it puts it in the flow. What, what does this
[00:23:56] Soraya: Yeah, what, what we are, what we are looking at. So we have, um, peer to peer capabilities, you know, like separate campaigns and we have events where you’ve got fundraising on top of it. Uh, so those two event types where you can say. I allow I going to enable you to set up your own fundraising page. That’s what we’re talking about versus just an event where you buy a ticket or just a campaign where you individually donate.
[00:24:19] So we’re not talking about social sharing here. That definitely has power, but when you actually encourage people to set up their own fundraising page, we see almost four times more raised. That’s right.
[00:24:29] George: So the individual is creating a page that they have their, like their fingerprint on under the banner of the organization. And then they’re encouraged to share that page on social, check out my fundraising page, and then they post it.
[00:24:41] Soraya: That’s right. That’s right.
[00:24:44] George: Yeah. That
[00:24:44] Soraya: they don’t have to be great at it. You know, that’s the, I think that’s the compelling thing is people say, like, I don’t know that I’ve got these power fundraisers. I think that was the point. That was really exciting to me. You don’t have to have a network of pseudo development staff at your disposal.
[00:24:59] You just ask your, your committed fundraisers to open up a page. They get a couple of donations and you think about right there, that’s four times as much donations, you know, four times as much volume. It doesn’t take long for the math to get there. And yet it feels really profound. When you say four times the amount of volume as any other campaign type.
[00:25:17] Yeah. Just, just allow people to kinda help.
[00:25:20] George: Yeah, it seems like in some ways you’re unlocking the power law even more so where clearly. 10% of your followers, donors supporters have 90% of the potential following. There’s gonna be one person in there. Who’s just happens to be hyper connected. And by allowing that person encouraging that person to leverage that social network, you’re, you’re, uh, you’re dancing in the right side of the power law.
[00:25:45] Soraya: That that’s it. And you, it, it really doesn’t, you know, if you have really sophisticated peer to peer and event with fundraising, keep, you know, um, campaigns absolutely. That exists, but they don’t always have to be that you, you know, with the right tooling, you just say, yes, this is an option. They will take it from there.
[00:26:01] Um, so I, I also recognize that we’re talking to development officers and development managers who are saying, I don’t have a huge staff to launch all these complex campaigns. You actually don’t necessarily need it. You know, tech can help you. Tech can fill in the gaps of what, you know, your staff can’t do manually.
[00:26:17] It should be doing that. It should help you scale. And this is one of those areas.
[00:26:20] George: I love it. Anything else about the report we should
[00:26:23] Soraya: So there’s one piece that is a really unintuitive. Stat. And so it takes a second to parse it, but I think it’s, it’s fascinating when you think about it. So recurring capture rate, when you are, um, donating and you decide to become a sustaining member as opposed to a one time member. Um, let’s say that’s a, you know, 10 percent-ish capture rate over time.
[00:26:45] When you, as a development officer, look at your transactions, this is platform wide for us. You look at all of your transactions in a month. 58% of those transactions were recurring donations. That means that they were decided to give before that month. So it’s not that there’s, you know, 58% of the people who come in on any given month are making a recurring gift.
[00:27:04] It’s that the transactions that are processed in that month, 58% of them end up being recurring gifts that have been decided before that. And so if you think about your donor outreach strategy and your engagement strategy, know that. More than half of the transactions in given month have already been committed to how are you engaging that audience?
[00:27:24] So back to like the e-commerce days, we think a lot about, are you talking to your recurring donors? Are you making sure that you’re, you’re letting them know that ongoing impact? Are you making sure that they have opportunities to give again? Are you treating them like gym members where you’re hoping they set it and forget it and you never talk to them and they just let it go forever?
[00:27:41] Or are you saying we wanna make sure you understand the value of this dollar because it. It’s the, it’s the predominant number of transactions, even if it’s not the predominant number of donors you see every month. And so we just don’t want ’em to, we don’t want it to become like the silent majority that you forget about and take for granted and take, you know, just assume they’ll always be there.
[00:28:01] They require some cultivation they require talking to, and we actually see that about a quarter of recurring donors end up giving one time gifts on top of their monthly commitment. You should absolutely be engaging with this cohort. So it it’s, I know it’s a little bit of a confusing stat when you say it this way, but I just think about, you know, you look at a report and you see this many times a credit card was charged in this month.
[00:28:22] More than half of those cards, those donors didn’t come to your site necessarily that month they had already committed. And are you thinking about them as actively as you would any other kind of cohort of donors that month and you should be? Um, so I think a lot about donor segmentation and engagement and ongoing communication, um, and how important it is.
[00:28:40] George: think the only thing that stuck to my brain there was that we have reoccurring donors as a nonprofit.
[00:28:46] Soraya: Yes.
[00:28:46] George: According to your data. Literally one out of four of those folks will just write an extra check. If I reach out to them,
[00:28:55] Soraya: Yes.
[00:28:55] George: I feel like that is something that would scare the, the fundraising pants off.
[00:29:01] Somebody be like, oh my gosh, don’t disrupt. Leave them. Be let the money come in. Don’t like piss off anybody being like, how dare you ask me for more money. I already give you the money,
[00:29:12] Soraya: Yeah, no,
[00:29:13] George: no, the data suggests other.
[00:29:15] Soraya: the data suggests otherwise. And, and again, I think we’re, we’re scared because we feel like we got away with something when we got that recurring gift and like, oh my
[00:29:22] George: did, you got the
[00:29:23] Soraya: money. For however long. Um, but people wanna validate their decision to invest in you. They’re investing in your organization and your cause and the impact you can have.
[00:29:33] So the ways that you communicate that was a good investment, the way you should validate that investment and the ways that you can communicate, how much more you can do with a little kind of extra on top, that all speaks to their values and why they’re with you. So it definitely shouldn’t be something scary.
[00:29:47] It’s really powerful. Uh, donors.
[00:29:50] George: That’s interesting. I’m wondering, do you know your average retention for a reoccurring donor? Like that, that gift amount? I’m always. Do you get more in the one time where that, uh, that cutoff and that trade off is it depends on, you know, who, which data source you’re talking to
[00:30:05] Soraya: Um, I do, and I’ve got fresher data. That’s like hot off the press as of yesterday that I won’t share yet. So a few years ago we pulled it maybe two or three years ago and we found a recurring donor is five times more valuable than a one time donor. Um, we have seen that go up meaningfully, um, almost.
[00:30:22] I, I shouldn’t dare you, but something like almost double it’s almost, it’s almost, it’s almost double
[00:30:27] George: More.
[00:30:27] Soraya: And it’s because of some of the, um, capabilities that we’ve enhanced along those lines of, you know, through, through our payments offering, which is, you know, recurring, retry, recurring capture.
[00:30:38] Automatic card. Updater the ability to engage with donors before cards expire. If, you know, if we don’t think we’re gonna be able to update them, there’s all kinds of capabilities to allow you to extend the life of a donor. Because more often than not, you lose a recurring donor because of a payment failure, not because they’re canceling.
[00:30:55] And so if you can address all of those, all of those reasons, or as, you know, as much as you can, you can extend the life of a donor, um, substantially.
[00:31:03] George: That makes sense. And there’s also just been like technical shifts in the way some credit cards operate that even when you cancel it, if it’s a preexisting payment system already in place that they maintain that while canceling any new charge. So there’s like just sort of happy accident of fate
[00:31:17] Soraya: Yes. That’s right. Well, and the thing that I’ll add is if you really can get 25% of these donors to give a gift again, why would you ever say, I want the one time, because I’m scared that this is gonna be a lower donation amount over time. Like they’ll come back because you’ve got that consistent relationship with them.
[00:31:32] And so there’s just, there’s all kinds of reasons why no recurring is still. Still the way to go.
[00:31:38] George: Like you’re living on the positive end of the hedonic treadmill,
[00:31:41] Soraya: Yeah, there we go.
[00:31:42] George: fancy way of saying people just get real used to what they’ve been doing. Right. And like, oh, you know, like life could be as good as you want, and then you get used to it. And you’re like, this sucks. I want something new. So on the positive side of that, I’m used to giving my 25 or 50 bucks, whatever the number is a month.
[00:31:56] Like that’s what status quo is. But is that good enough? The hedonic treadmill says no.
[00:32:01] Soraya: We can do more and back to payments offerings. Um, I think we saw that for ACH. Let me see it. Oh yeah. Recurring gifts. When you have all these payment offerings, recurring gifts on ACH, which is kinda direct bank transfer are 30% higher than credit card. So even that number of what
[00:32:15] George: Can you say that again? I
[00:32:16] Soraya: yeah.
[00:32:17] A AC recurring gifts made on ACH versus credit card. It’s it’s like a direct bank transfer
[00:32:24] George: Gotcha. So I connect my bank and then like, I’m, I’m locked in.
[00:32:27] Soraya: That’s right. That’s about 30% larger than those made on credit card. And so back to payment offerings, when you’re engaging with kind of sophisticated donors and you can actually nudge them on, you know, if you’re giving, you know, these might be like, these are options for you.
[00:32:42] These are recurring donors who want to give in these other, in these other ways. Uh, you can actually nudge that number up as well. And so then. You start, you start compounding all of the impacts of these little benefits and it starts to be really, um, meaningful relative to let’s say a one time gift where you only have one, you know, payment offering and, um,
[00:33:01] George: You also can dance. You also can dance with the fact that you don’t have to pay the credit card processing fee when you use ACH. Cuz
[00:33:06] Soraya: That’s right. It’s cheaper for the organizations. That’s right. A hundred percent. Yeah.
[00:33:10] George: well, awesome. I’m glad you, I’m glad you added that. That’s a, another counterintuitive, but look at the data and, you know, file that away.
[00:33:17] There’s some real, there’s some real good gems in here. Thank you for sharing
[00:33:20] Soraya: we think so. Yeah. Yeah, absolutely. We’re happy to do it.
[00:33:24] George: Yeah. Rather than just keeping it inside. You’re like, oh, here are our secrets. You you’ve decided to share it. I, I do. I do genuinely appreciate that. Alrighty. Are you ready for rapid fire?
[00:33:35] Soraya: now let’s go.
[00:33:36] George: Okay. I don’t know if you have much of a choice, but I always
[00:33:39] Soraya: I
[00:33:39] George: that because, you know, uh, you know, ask, ask permission.
[00:33:44] Okay. So let’s kick this off. What is one tech tool or website that you have, or your organization has started using in the last year?
[00:33:51] Soraya: The calm app. It helps me at work. It helps me with everything. I know you think that’s a, that’s a, that’s a cheating answer, but it’s not mental state is everything
[00:33:59] George: That’s great mind achieves with the mind achieves with the body believes and strike that reverse it. Tech issues. What tech issues are you currently battling with?
[00:34:08] Soraya: Data availability everywhere. And as completely as I want all the time, I don’t know anybody who won’t an won’t have that in their answer somewhere on their list.
[00:34:16] George: Yeah. What is coming in the next year that has you the most excited?
[00:34:20] Soraya: we just joined forces with GoFundMe and there are.
[00:34:24] George: about that.
[00:34:25] Soraya: Uh, I am so excited because there are a hundred million donors on that platform who are activated and engaged and not actually affiliated with nonprofits. It’s all individual acute cause giving. And if we can connect those donors who are responding in a moment to a human and say, there’s also organizations fixing this issue at scale and structurally, would you like to meet them and continue this relationship?
[00:34:48] I think there is so much power for organizations and that is why we did it. And I cannot wait cuz we are working on it. Right.
[00:34:54] George: Might have another podcast in the future. I’m always curious about companies that, that get acquired and then I’m always watching.
[00:35:02] Soraya: Uh, I am so enthralled about it. It is like the most exciting area of how do you fundamentally change the game for nonprofits operating at a very competitive market? And I think this is a really exciting one, so I would love to talk about it.
[00:35:17] George: All right. We’ll put, put a pin in that one.
[00:35:19] Soraya: Yeah. Great.
[00:35:19] George: Talk about a, can you talk about a mistake that you made earlier in your career that shapes the way you do things now?
[00:35:25] Soraya: No, I never made a mistake. I’m just kidding. Um, so, uh, I have so many, um, I think one of the earlier ones was, um, I was, I was, when you’re early in your career, you were kind of insecure about how little experience you have. And so you try to overcompensate with confidence and demonstrating mastery, and then you get nowhere cuz you can’t actually have honest conversations.
[00:35:46] You’re not in a position to learn and everybody sees through it anyways. Uh, so I’ve completely overcome that. Like I just wanna get to good answers and better insights and I don’t care who has them. It’s probably not gonna be me. That sounds like such a cheesy thing to say, like once you’re management, but it’s absolutely true.
[00:36:00] And. The faster you get over that. And you’re willing to say you’re willing to like really get into learning mode. Uh, the better, the better your life is the better outcomes. There are, the faster you get ahead. All the things.
[00:36:10] George: believe that nonprofits can successfully go out of business.
[00:36:13] Soraya: Uh, I used to work at PBS and worked at Lincoln center for a hot second. So I hope not.
[00:36:17] George: If I were to throw you in the hot tub time machine, back to your start at classy, what advice would you give yourself?
[00:36:25] Soraya: The impatience to be great because the sector needs it. um, just be really unapologetic about that. I think at first you’re trying to kind of navigate and make sure you don’t rock the boat. I’m all about rocking the boat. If it means it’s better outcomes for this sector. And we are really unapologetic about that now, but it took me a little, you know, it took me a second to really own that position.
[00:36:46] Um, and I would just, I would just start even faster.
[00:36:48] George: is something you think you or your organization should stop doing?
[00:36:52] Soraya: I have a million things I should stop doing. One of the things I’m really proud of with our organization is we definitely have a culture of, if you see something stupid and you elevate it and there’s discussion and we agree it’s stupid, we just stop it. We are actually like very unattached to anything because it’s always been done that way.
[00:37:07] Um, so I can’t think of anything, not cause we haven’t done stupid things, but because anything that I know about, I think we’ve been pretty, uh, aggressive about stopping. I think it’s an important skill for any company to have. I will say that or any organization
[00:37:19] George: like.
[00:37:20] Soraya: it’s just, it’s just impatient for inefficiency and in, and, and impatience to be great. Like, I really think it comes that that seeps through the, the DNA of, of everyone. So it’s not that we can fix it overnight, but if we see something we should, we need to fix or we see something dumb. Yeah. We, we, we try to jump on it.
[00:37:35] George: If you had a magic wand to wave across the social impact sector, what would it do? And you can’t say just generate a whole bunch of new classy users. Like I’m taking that ability off the wand and no more wishing for more wishes. I’m tired of it. We can’t have it.
[00:37:47] Soraya: Come on
[00:37:48] George: inflation and I won’t have it.
[00:37:49] Hmm.
[00:37:50] Soraya: um,
[00:37:51] George: What is your donor
[00:37:52] Soraya: Donor retention, fixed donor retention. We’re trying in absence of, in absence of a magic wand, we’re trying with tech, but fix the donor retention problem, because I also think that talks about are people engaged in the cause. So it’s so much more than dollars. It’s also about like public engagement with these causes and these missions that is required right.
[00:38:09] Alongside the dollars.
[00:38:11] George: right now on average 54.
[00:38:12] Soraya: Um, our, you know, like our recurring donation or
[00:38:15] George: No, just like overall, like, yeah, reoccurring, like I gave this year next year. What percent am I likely?
[00:38:20] Soraya: Donor retention across. So there’s like a bunch of ways to cut it. It’s it’s lower than that. Going up fast. If you adopt all of these capabilities, it kind of depends on what you adopt. Um, and it’s for the base organization.
[00:38:32] I think industrywide not just on classy. It’s something like a fifth. I mean, it’s something abysmally low. I don’t know. Remember the reports are out there. Um, all of these tools we have seen kind of meaningfully increase that long lifetime value, a long retention, um, still lower than I think anybody would like it to.
[00:38:49] George: Yeah. So hovers around 20% for you all,
[00:38:51] Soraya: Well, not with, not with our recurring and our classy pay customers. So no that’s much higher, but, um, yeah. Yeah. Mm-hmm,
[00:38:57] George: Gotcha. Appreciate the sidebar. How did you get started in the social impact sector?
[00:39:02] Soraya: I took a semester in college and went and worked full time at amnesty international and the refugee department in DC and loved it. And then started at a strategy communications digital agency for the social sector right after college. So early, as early as you get in my career.
[00:39:18] George: What advice would you give college grads looking to enter this sector?
[00:39:22] Soraya: Most entry level jobs kind of suck, but. There is always something to be learned. If you really lean in and you try to figure out who is doing interesting things, how can I be of value? How can I work a little harder? Because you get exposure to do interesting things and your job for most of your career is to gain as many experiences as you can.
[00:39:40] That doesn’t mean job hop. That means whatever you’re doing. Try to involve yourself in as much as you can and do it really well. And it will all start coming together into something that looks like a linear career. It just takes a second. So be patient and really lean.
[00:39:52] George: What advice did your parents give you that you either followed or didn’t
[00:39:56] Soraya: Um, I am, uh, I am a little bit intense and I am always trying to like, You know, work really hard to prepare for the next thing to, to, um, set myself up. Well, and I think when I was 15, my mom looked at me and said, you know, you’re not gearing up so you can get ready. So your life starts like, this is it. This is your life.
[00:40:14] And so it didn’t really sit with me. Yeah, that’s it. I didn’t really sit with me until I had kids, but now I think about it a lot. Like this is it. If I’m not living in the moment, What am I doing back to the com app? the, the grounding efforts are, are, uh, are a dominant part of how I, how I try to operate now.
[00:40:31] George: Brilliant. Last hardball question. How do people find you? How do people help you?
[00:40:36] Soraya: Uh, come find me on LinkedIn. I am, uh, I am there. I would love, love to connect, go to classy.org. You can contact us there and it’s still, um, you know, very accessible team. I would love to chat with anybody who is listening, who wants to learn more, definitely check out the report. But yes, I would love, um, LinkedIn is a, is a great place.
[00:40:55] George: thanks for the work you do really excited also about the headways that you’re making in the, the GoFundMe and helping nonprofits claim, a larger stake of that, that audience. That’s
[00:41:07] Soraya: Thank you so much and thanks for the work you do. Um, and I’m so happy to be here. Thanks again.
