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Sunday, 16 February 2014 22:33

New app provides schools, nonprofits with digital fundraising platform

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Grand Rapids-based Benefit offers a digital card platform that allows organizations to raise funds quickly in a manner similar to the SCRIP fundraising model. With the Benefit app, people can buy and redeem the digital cards from their mobile phones. Grand Rapids-based Benefit offers a digital card platform that allows organizations to raise funds quickly in a manner similar to the SCRIP fundraising model. With the Benefit app, people can buy and redeem the digital cards from their mobile phones. COURTESY PHOTO

Derik Lolli has developed an app designed to make it easier to participate in nonprofit fundraising and tuition reimbursement programs at private and parochial schools.

Lolli is the founder and chief executive officer of Benefit, a Grand Rapids-based digital card platform that enables schools and organizations to raise funds quickly and with minimal effort. It is similar to the SCRIP fundraising model where donations are made by purchasing retailer gift cards and using them for everyday shopping.

With the free Benefit app, people have the ability to buy and redeem cards within the actual stores from their mobile phones.

“When people download the app, they have access to about 80 national retailers,” Lolli said. “They simply shop like they normally do and that results in a percentage donation to whatever they are supporting.”

The app could eliminate the need for schools to carry inventory and schedule individuals to distribute the gift cards and collect the money for them, as is the case with the majority of SCRIP programs.

Lolli said he got the idea for developing a mobile app after his son came home with a piece of paper from his school inviting the family to join a SCRIP program. He said participating in such a program is a challenge for parents who don’t have time or are unable to pick up cards each week within a certain window of time.

Lolli previously worked in web and mobile development at Universal Mind, whose clients included Sony Music and Apple.

“This has taken the whole model and removed the physical aspects from it,” Lolli said.

The app was launched in January after a three-month trial run at Holland Christian and Grand Rapids Christian schools.

“We have seen an incredible amount of interest from our families who are very eager to be able to make SCRIP purchases from their mobile phones,” Dave Zimmer, director of finance at Holland Christian Schools, said in a statement. “The revenue earning potential for each student is substantial. We expect Benefit to significantly reshape the way Holland Christian does tuition reimbursement as well as provide opportunities for other fundraising activities.”

However, Jane Leeuw, whose company provides the cards to organizations and schools including Hackett Catholic Central High School in Kalamazoo, said she thinks there will always be SCRIP customers who want the face-to-face contact and actual cards to give as gifts.

Leeuw, chief operating officer for Scrip Pro based in South Bend, Ind., said she is meeting with Lolli to get a better idea of how the app might benefit her company and its customers, mainly tuition-based schools and schools looking to raise money to maintain athletic and arts programs that have been impacted by budget cuts. The issue is close to home for Scrip Pro, whose owner had 11 children he put through Catholic school, she said.

“We’re really in it for the nonprofits. Younger families probably do want to be more mobile,” Leeuw said. “From our standpoint, it would help us, too, because we wouldn’t have to ship as many orders out.”

Benefit has no inventory and very little overhead, Lolli said. He said he works with third-party card processors who provide the digital cards. Benefit makes money by taking a small percentage, normally 1 percent, from the dollar value of the cards. As an example, a Banana Republic gift card valued at $100 would be sold to Benefit at an 11 percent discount with 10 percent going directly back to the school or organization and 1 percent going to Benefit. The company currently has agreements with more than 70 national retailers, including, Gap, Banana Republic, American Eagle, Barnes & Noble, CVS, Foot Locker, JCPenney, Logan’s Roadhouse, Papa John’s, Home Depot and Zappos, among others.

“With every transaction we’re trying to take 1 percent,” Lolli said.

Vendors who sell the cards to Scrip Pro are pushing the use of codes instead of actual cards, Leeuw said. The cards have numbers on them representing codes loaded with the dollar amount that can be entered into a cellphone and scanned by a cashier.

“The vendor has to be able to accept the codes,” Leeuw said. “So do you hand the phone to the cashier and let them scan it in? It is a learning curve, and I think there’s something about that face-to-face contact. I think there’s always going to be a need for plastic.

“You don’t want to give your kids a code. You want to give them an actual card.”

Lolli said he knows it will take time for people to get used to the app.

Within the first week of the Benefit app launch, about 20 organizations signed on to use it and he and his staff of two are hoping to bring on 1,000 schools at a time into the app program.

He said a nonprofit organization in Pennsylvania that supports orphanages overseas and another one that supports North Korean refugees are already using it.

Despite SCRIP being a $1.5 billion industry nationally, Lolli said for every one person who uses it, there are two or three who do not. His company’s app opens new opportunities for organizations to raise funds in ways that are convenient for many consumers, he said.

“It’s very national. We’re focusing on schools and can sign up nonprofits. This is what I refer to as low-hanging fruit,” Lolli said. “There’s an engaged audience already participating and they’re looking for a painkiller. This is for any nonprofit looking for another way to raise money, and it’s turning everyday consumers into donors.”

Read 5742 times Last modified on Sunday, 16 February 2014 18:22

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