Asking for Giveness

giveness.pngGiveness is a nifty-named Longmont based startup that quietly launched in March of this year as “a social network for philanthropy.” The site has managed to sign up about 90 charities thus far. The flash intro full of marketing speak doesn’t do much to explain how it actually works, but it’s worth a look anyway as you do get to see the girl in the foreground with the freakishly large head.

What happens here is that a charity can register, and then promote items for sale. They can also use the site as a presence for their community by adding such features as blog syndication, videos, photos, commenting, friending, and more. The charity can then promote the site and ask folks to buy items from their Giveness profile. Giveness then directs 100% of the commissions from those sales back to the charity.

Basically, Giveness is simply claiming otherwise non-existent commissions on behalf of the charities that refer traffic to them. Here’s how it works for the Rochester County JCC, for example.

I asked the obvious question – why not skim those commissions as a business model while still returning most of the value to the charity?

“Our model is interesting in that we have a potential revenue stream coming from the commissions generated through the purchases made through our site. We’ve made a conscious and ethical decision not treat these commissions as a revenue stream for Giveness. We look at the work involved in generating, managing and distributing these commissions to our charities similar to the bandwidth expenses incurred if we were developing a free video streaming service like YouTube.” – Founder, Richard Waldvogel

Richard went on to explain that Giveness is for profit, but hopes to create a “win, win, win” for organizations, merchants, and individuals interested in these charities.

“We view the concept behind Giveness as a different way to think about how you can conduct business. We’ve all worked at jobs where our only goal was to make a profit. We’ve all volunteered our time during our personal lives where we’ve tried to make a difference. The ideal situation is to “mash up” these 2 philosophies where you can make a living and make a difference at the same time.” Founder, Richard Waldvogel

When I asked Richard about the number of users on the site so far, he explained that they have created a zero friction process by which the people who want to help the charity simply need to click through to the merchant with no registration required. To Giveness, it’s not about the number of registered users. It’s about the number of purchases they can drive through the site that would otherwise occur from natural traffic to these same merchants.

So how does the company plan to make money? Through sponsorships and advertising and premium upgrades. The Web 2.0 way, of course.

The company is currently angel funded and plans to seek additional investment in the future.

The trick here is obviously going to be to land some charities with large existing communities that can be the target of promotion. Then Giveness will have to provide the tools to distribute the profile links in interesting ways across those user bases. I smell a social widget in their future.

file under: Blog, Startups