Philanthropy in the U.S. is growing. In 2019, Americans gave almost $450 billion in charitable donations, a 5% increase from the previous year according to the National Philanthropic Trust. And donations from individuals accounted for over half of that amount. That positive growth is likely to continue because over 80% of Millennials donate to charity. However, Millennials also find it difficult to make large donations. As a result, a new model of philanthropy has arisen — giving circles. These are groups of people — circles — who pool their money together in order to make one large donation to a cause they all support. However, issues of organization and coordination can make creating giving circles difficult.

Grapevine is offering a solution through its online community management platform for giving circles. The platform enables groups to create circles, add members, make donations, and more. We spoke with co-founder and CEO Emily Rasmussen about the strength of philanthropy and the fast growth Grapevine has already seen.

Funding Round Details

Grapevine logo
Company: Grapevine
Security Type: SAFE
Valuation: $7,000,000
Min Investment: $100
Platform: Wefunder
Deadline: Nov 18, 2020
View Deal

Can you give us a brief elevator pitch for your company?

Grapevine is the first group giving platform for everyday philanthropists. We help groups of friends, families, and alumni create Giving Circles, where they pool their donations and decide together where to give. We’ve already moved $1.5M by growing donations month over month (MoM) at 67% since launching in March. Our revenue comes from tips that average 5% from our passionate community of 5K donors. We’ve partnered with the Gates-backed national giving circle initiative and are backed by top early stage investors — including the XX Fund, YC alumni, Ground Squirrel Ventures (early Wayfair employees), Cofounder of Human Interest, Cofounder of Caviar, many passionate Grapevine users, and more.

What inspired you to take the leap and build this company?

While working in the nonprofit sector I saw that the philanthropic industry only worked well for the super wealthy. It motivated me to create a solution for the rest of us. The majority of donors are underserved and account for over $140 billion in donations every year, as well as $140 billion in potential donations that are just sitting on the sidelines. This $280 billion opportunity represents a huge gap for everyday philanthropists, like me. So I started exploring concepts for how to make it easy for the rest of us to give with purpose and became excited by the fintech sector and the concept of AngelList Syndicates for giving… That inspired the leap and ultimately, our group giving platform – Grapevine!

What past experiences prepared you to start, build, and lead your company?

My domain expertise comes from being in the microfinance and nonprofit fundraising sectors for 10 years, as well as spending my time at Harvard Business School consulting for Kickstarter and launching a new crowdfunding platform. I’ve also had some great intrapreneurial experiences where I built new brands, teams, and products. At Lincoln Center, I launched a global media initiative and at New York University, I co-founded a new international incubator. I attribute my determination and work ethic to my professional ballet background.

What is your vision for the future of the industry you are operating in?

My vision is a world where purposeful giving is easy and accessible for all of us. We’re doing that by making Giving Circles ubiquitous — and the Grapevine brand synonymous with Giving Circles. I believe a world full of passionate, empowered, diverse individuals giving together collectively and intentionally is going to build a better future for all of us.

Who is on your team and how did you come together?

Our CTO Arrel Gray was the Co-founder & CTO of Wonderschool, an Andreessen-Horowitz-backed company that raised more than $20 million led by a16z. He’s a serial founder/CTO who previously launched two other successful startups: Soldsie (acquired) and 17FEET (acquired by Google). Arrel and I were introduced by Paul Sawaya (YCS’15 and Human Interest Co-founder), who is our mentor and lead investor from the XX Fund.

Other team members include: Emily Schaefer, head of community, who joined us last year when the former Chief Counsel/COO of Kickstarter (who is a Grapevine advisor) introduced us. They had worked together at Teachers Pay Teachers where Emily ran communications for their 5M+ educator community. Grapevine co-founder Jessan Hutchison-Quillian created Google’s Giving Week, led development of their giving platform, and launched their Donate button in search results. And Chloe Moon, a senior engineer and former colleague of Jessan’s at Google, built the V1 version of Grapevine.

Do you have any competition, if so, how do you differentiate?

We’re the first platform for Giving Circles. As one circle leader recently said, “This is revolutionary!” We’re the first mover in a rapidly growing market with significant switching costs and we see what others don’t: 

  • This market is based on recurring gifts, not one-time campaigns, so the long-term value is significant. 
  • This is a grassroots movement that has tripled in the last 10 years and is expected to more than double by 2024. There’s massive potential to extend into new communities as well. 
  • Circle members give much more than average, so there’s a huge opportunity to make Grapevine their home for individual giving too.

There are some nonprofits that provide a basic charitable account for donors to pool and direct donations, but they’re clunky and incomplete solutions. They don’t have a great user experience or modern tools to help people collaborate on where to give and see the results of their collective impact.

What does your business model look like?

Our revenue comes from tips left by our donors at the time of donation. Our average tip is 5%, and we expect to grow that to 7% based on feedback from other high growth companies that have successfully used this model, like IndieGoGo and GoFundMe. We’re already seeing additional revenue opportunities for future expansion, including: premium services for $30K+ annual giving groups, charitable sponsorship as a service, and increased share of donor charitable wallets.

What brought you to equity crowdfunding and how do you intend to use the money you raise this round to scale the business?

We’re on track to break-even later this year, but we’re doing this equity crowdfund for three reasons. First, COVID-19 has created more social need and amplified demand for our support — we want to expand our growth and engineering teams to meet this demand and grow more quickly. Second, we were in the top 1% of the 2,500 startups that applied and were accepted into the WeFunder/ XX Fund “Fight the Virus” program, run by Y-Combinator alumni. After monitoring our progress we were selected from that group for investment and invited to launch a Wefunder campaign for the XX demo day. And third, we’re a community-based platform for giving and thus, we feel it’s fitting to also be a community-supported company.

What do you want potential investors to know about you and/or your company?

We’re at the beginning of a massive growth phase — we have grown donations at nearly 70% MoM for the past six months and that’s with no marketing spend and a skeleton team. Our model of recurring giving is super sticky (we’ve had just one Giving Circle churn over the past six months), which gives us a recurring base of donations and tips (more than 50% of donations are recurring) that are easy to forecast and build on. With additional investments in our engineering and growth teams, we can unlock significantly more growth in the months and years ahead. The investors who come in now are going to benefit from that growth.

As you think about the business 5-10 years down the road, what do you see exit opportunities looking like? Have you set any future goals for the company?

Our exit goal is to IPO. We expect to move more than $1 billion in donations in 2025 alone and to earn $70 million in revenue that same year. We will quickly become a billion dollar company from scaling our current product and business model that are already working. There are also many strategic acquirers in our industry that have purchased online giving platforms with new tools and communities for hundreds of millions of dollars. Ultimately, our focus is on scaling quickly and profitably, which will create attractive exit opportunities.

Our goal as a company is to get you and everyone you know to participate in a Giving Circle, or two or three!

We at KingsCrowd are excited to see where Emily and her team take the company. Grapevine is currently raising on Wefunder.