DonateNZ – The “Who”, “How” and “Why”

September 14, 2009 at 1:15 pm 25 comments

It’s an inevitable question, running DonateNZ, that we get asked “So, how do you guys get funding and make a living?”.  Unfortunately it’s a question I don’t have an answer to presently and what keeps me awake all night.  “How much should I tell them?” I ponder.  Should I tell them my family has essentially donated over $300K to DonateNZ to get it off the ground?  Should I say I don’t earn a wage and my Mum works at a florist shop by herself all day to support both her, Dad’s and my own living?  No no.  They don’t want to hear the whole story.  So I tell them the abridged version, or when someone looks to be in a hurry, I just tell them we have community funding, as we don’t want peoples sympathy or their charity.  We simply want people to believe and participate in the DonateNZ movement we have created.

It is perhaps this stiff upper lip, “we can do anything”, “we don’t need any help” Kiwi attitude which has gotten us to this place we are at now.  As, taking a birds eye view of the situation, we must sound either incredibly crazy or incredibly stupid.  One would assume that we have lots of money to throw around, however I assure you that’s not the case.  We are not crazy, or stupid.  We’re not hippies with an entirely unrealistic dream and we certainly aren’t rich.  My parents and I are simply 3 Kiwi’s who got sick of sitting around complaining about the state of the nation and decided to put a great community idea into action.  That idea was that with an easier method of communicating, we could all contribute a lot more to our community.  Thus began DonateNZ, the website where you can connect what you no longer need with an organisation who can use it.

DonateNZ began with a business model in 2006.  It was not created to make a lot of money, we simply hoped I would be able to earn a living from doing it.  In addition to this, business is all my family has known and when we began exploring the option of being a charity, funding would have taken anywhere up to a year to secure.  “Far too long!” we said, “NZ needs this service now, let’s do it!” we cried.

So after my first meeting with the bank manager, we secured our first loan of $150k against my families business (Roses Are Red) to get DonateNZ started.  Our business model was to earn $100+gst from every Recipient member who signed up and that we said, would make the service sustainable.  We were away!  However, fate was not on our side.  After getting away to a flying start and a couple of months into business, our web developers dropped the ball.  And by “dropped the ball” I mean they kicked it right through the china shop, refusing to pay for damages and then fleeing the scene.   Every business has to deal with website issues, it’s rife in this industry.  However, in our web based business’s infancy, we were essentially crippled.  Services were broken and traffic was exiting as fast as it was coming in.  All and all, we were not able to do anything we were promising in our sales pitch, nor were we any closer to coming up with a solution. (It is noted, despite this and solely due to the overwhelming popularity and support of the DonateNZ idea, we still managed to win “Best Government or Community Site” with that site at the Netguide Awards – beating the IRD and ARC!).

We were screwed, literally.  Alas, we continued to fight with these jokers to fix their mistakes, but it didn’t happen.  We came to a turning point, near the end of 2007.  Either stop now and cut our losses or get another site made.  We could have got out then and returned to our cave and licked our wounds, but we didn’t.  It may have been because we were too stubborn and proud to admit defeat but I truly believe it was because we knew in our heart we were doing a great thing – something that every New Zealander wanted and needed.  So by hook or crook we were going to make it happen.  All the chips were on the table.

We went out there to find a website developer and unfortunately no one would work over the existing site, so we were forced to rebuild a new website from the ground up.  So, off we went to the bank manager again……  The next $150K loan (over the family house this time), financed a whole new website and the next year of running costs.  Our new website built by Terabyte was launched in August 2008 and that’s the awesome version you see now.  It’s not quite finished though, as more work and user driven improvements are needed and you guessed it, more money is needed to make that work possible.  While people think that charities should and do get everything for free, this simply isn’t possible.

As we reached the end of the second $150K loan, we came to the realisation (maybe a little late) that we are not able to do this all ourselves.  We could keep trying, but at the end of the day, my Mum simply can’t work any more hours in the day to provide funds and DonateNZ will not be the best it can be without help from the rest of the country who in the end are the total beneficiaries of the site.  That’s what it’s all about, an awesome service for all New Zealanders, is it not?

Thus, we incorporated the Donate Charitable Trust.  Given the changes with the charities register, it took another 7 months from the date of our registration to get our application processed.  When our registration came through, we began to “sort out and close the business books” so to speak.  It wasn’t fun, trust me.  There is no rule book on how to turn from a business into a charity but the objectives have stayed the same throughout, but the paperwork, oh my!

As well as incorporating a charitable trust, we also made the decision to make the service completely free to community organisations, from the 1/4/09.  While a risky move, this has seen the number increase by 500% in the past 6 months as well as prompted a higher success rate of donations and wishes being filled.  All round, this has resulted in allowing the site to serve its  purpose better, as well as allowing us to leverage more promotion and partnership angles given a larger database.

Now, DonateNZ (run by the Donate Charitable Trust) is able to seek funding from local government, gaming trusts, private foundations and others who wish to donate.  We are IRD tax exempt and have our “charitable wings” so to speak.  But how on earth could we get funding?  I started by checking myself into everyone funding application course I could find (rather like rehab!) and  I came out of this starry eyed, thinking in order to obtain any of the millions of funding dollars which are out there, you just needed to fill the forms in properly.  Alas, it’s not that easy.  Funding it seems, is not going to happen overnight, or even in a few months.  I’m hoping, like Pantene says, that it will happen!   We are now onto our 21st funding application, none of which have been approved thus far.  In our case, based on off the record comments from funders, our problem seems to be that we do not seem high-priority.  Websites (despite how much good they do), I suspect, never will be.  We were told we don’t seem needy enough and we are also too professional!  Both things that I have never regretted until now, when the fate of DonateNZ literally hangs in the balance.  I take some comfort in the fact it isn’t just us however, organisations from right across every sector are struggling to secure funding.

Not content to just sit back and wait for funding to come our way, in June of this year the Trust started planning its own fundraiser; a raffle whereby all our members sold tickets and received 50% of the sale price.  Having secured a massive prize pool, ordered 75,000 tickets and just awaiting what we thought to be a formality; our raffle license, we were discouraged to hear that this raffle is prohibited by the Gambling Act rules.  It seems you are not able to pay a commission to members selling tickets, therefore making it impossible in any way to have a large number of organizations participating and get reimbursed proportionately for their efforts.  A fact which has essentially blown the whole campaign out of the water and we are back to square one.

We want to become an organisation which is able to sustain itself and at the end of the day, the largest stakeholder, our customers, should be contributing something if the service is working for them.  Therefore, we want to build into the website a system which prompts people to donate when they have used the site a certain amount.  Again, in order to make this money, money needs to be spent on development to put the procedures in place.

So, as you can see, we are somewhat in a limbo. We do not have funds. What we have is a extremely large mortgage, good will, running costs (kept to as minimal as possible) still being covered by Roses Are Red and an even larger commitment to make DonateNZ work.  I shall continue sending funding application after funding application and I will take every denial letter in my stride.  I will think outside the box and approach ever possible angle for funding I can think of and is suggested to me.  I know each day we win small victories and that these will add up and eventually we will succeed in securing sustainable funding for our venture.  We know we’re doing the right thing and that every person and organisation in New Zealand can and will benefit from the system we have built.  I just hope at some point that New Zealand will get on board and return the support we have given it, so we don’t go belly-up from doing this.

So that’s it, that’s the full story laid bare for better or for worse.  Feel free to share your opinions, thoughts and feedback.  As you can imagine, I’d especially love to hear from anyone who wishes to help us, in whatever capacity that may be. Or if you feel significantly moved enough to make a donation, please do so here.

Claire Sawyers
Creator, CEO and only staff member

Donate Charitable Trust (aka Donate NZ)
www.donatenz.com

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Entry filed under: Business Talk, DonateNZ, Uncategorized. Tags: .

Why use Twitter? Changing DonateNZ; who decides

25 Comments Add your own

  • 1. Jared  |  September 14, 2009 at 1:56 pm

    Claire

    What an honest post, you certainly are living the transparent life and I applaud you for it! It’s encouraging to read that in spite of your struggles you are still in there, fighting the fight. It will be worth it. What’s the quote, it’s always darkest before the dawn, something like that anyway. Kia Kaha.

    Personally, we are going down the charitable trust route for our venture, any tips to share in that area?

    Thanks
    Jared

    Reply
    • 2. clairednz  |  September 14, 2009 at 2:03 pm

      Hi Jared, thanks heaps. Will keep fighting!
      In terms of your charitable trust, I don’t know if I’m the best person to talk to, since I haven’t managed to secure any funding myself! However I am pretty well versed on how to apply, where you can apply and how to get trained to apply, if you need help in that area. Also have a bunch of books and resources on it. The ladies at Exult Fundraising http://www.exult.co.nz are a wealth of knowledge too, as well as that the Councils run free seminars, just need to contact your local Councils Community Development Officer. Hope that helps, let me know if I can help you out more,
      Claire

      Reply
      • 3. Jared  |  September 14, 2009 at 3:33 pm

        I should’ve been more explicit, we are still in the process of setting up the trust with a lawyer, so I meant any tips from the setting up side like in the trust deed or trustees. Anything really, but if there’s nothing that’s fine!

        Will make note of the tips you did give also.

        Cheers
        Jared

  • 4. JadE Tang  |  September 14, 2009 at 2:22 pm

    WOW Claire…

    Very inspirational! My respect for you and your family has increased 10 fold.

    If it’s any consolation, we’re in the same boat… people think that we have a lot of ‘funds’ backing us because of the big sponsor names that are associated with the challenge… little do they know the full story.

    In saying that, we are incredibly appreciative of ALL the support (financial, physical, mental), no matter how big or small, people have vested into yMedia the past few years and are forever grateful.

    But in terms of coming up with a self-sustainable model that is lies true to its key values and doesn’t commercialise it to the point we all lose our souls… THAT we’re still working on.

    Claire, if we can help in any way shape or form. PLEASE let us know. (I understand there was a bit of mis-understanding/communication around our processes earlier this year. So would really appreciate any constructive feedback you might have in and around this if you have any.)

    Anyway, I think what you’re doing is truly amazing and courageous, I’m confident it’ll pay off at the end of the day. Til then, wishing you the VERY best with DonateNZ. You have my whole hearted support…. now, if only I had some money.

    Best,
    JadE Tang
    (Art Director & Connector)

    Reply
    • 5. clairednz  |  September 15, 2009 at 7:09 pm

      Hi there Jade,
      Thanks for your kind feedback, yes it is a hard slog isn’t it! It is frustrating the misimpressions people get in regards to sponsorship, it was partly comments like that; “Oh I thought you just got given your website for free” which prompted me to realise that until we educated people about what it took to get where we are, that we may never get the support we need in future. As I say to our members “If you don’t ask, you don’t receive”.
      Perhaps there might be an opportunity to get together and bounce ideas around about how we can work together/help each other in future, I love what YMedia does and vice versa! What do you think?
      – Claire

      Reply
  • […] DonateNZ – The “Who”, “How” and “Why” […]

    Reply
  • 7. Ruth from slynkey.com  |  September 14, 2009 at 3:04 pm

    Hey Claire,

    Great honest post!

    I totally relate to what you are saying when you mention not knowing how much to tell people! While I want to be realistic and honest about what it’s like to start and run a business, I don’t want to seem like a failure or scare people with the reality of it all! 🙂

    I will try and do whatever we can to help through slynkey, Keep up the good work. I have to believe if we work hard, be honest and do something that we are passionate about it will all work out in the end…

    R xx

    Reply
    • 8. clairednz  |  September 14, 2009 at 5:55 pm

      Hi there Ruth. Thanks for your kind comments and support.
      In terms of what to tell people, as a small business it was essential to keep most information under lock and key, to project a professional image and ensure credibility and to be considered alongside the big players. No one wants to work with a fly-by-nighter and more often than not, people don’t want to advertise on a new site till it proves its worth.
      Now that we are a charity the tables have changed a little bit; we must be very open with everything publicly; a change which has/will take some getting used to; as I too, do not want to seem like a failure!
      I hold out hope though that if you keep battling away we will eventually both make it through to a success! (whatever that/they is). For me, in the short term, it would be when I can securely earn a wage running DonateNZ, so I can pay the mortgage!
      – Claire

      Reply
    • 9. clairednz  |  September 15, 2009 at 7:01 pm

      Thanks Ruth, yes it is a hard line knowing what to share as a small business. Generally you keep it to yourself in order to seem professional and compete with the big players. It’s even more difficult going from being like that, to becoming a charity, where everything must be open. I think I have been guilty of keeping this all to myself and labouring away endlessly, but I’ve realised recently it is vital for us now in order for people to understand DonateNZ and support it, that we must be completely open and up front about what we’ve done to get this far. It leaves me feeling quite vulnerable, but hopefully people will recognise and support us for what we’re doing! Thanks for your offers to help and the same goes for you, happy to help wherever I can!
      – Claire

      Reply
  • 10. Jane  |  September 14, 2009 at 4:14 pm

    Your story is inspirational and incredible Claire and an example to all. Here at the R.Tucker Thompson we have been through struggles and challenges, nearly going under in May this year. We firmly believed in what we were doing, and we knew what we were doing was changing the lives of young people, particularly those who might well have gone down the wrong path. We were incredibly fortunate to come to the attention of someone with a trust to invest in these types of activities who was will give us a help up and provide a bit of financial assistance. It’s still really tough, don’t get me wrong, but it’s taken the terror out of the day to day and has allowed us to go foward with some confidence. We firmly believe in Karma, and the wheel will come around to you and you will be rewarded in some way, perhaps not financially. Shame on the website developers though. Their turn will come as well.

    Reply
    • 11. clairednz  |  September 14, 2009 at 5:38 pm

      Thanks Jane, we will keep soldiering on. It is inspirational to hear of others who have triumphed over disaster, as some days it gets very tough. Yes those web designers were scalliwags, but the web developers we have now Terabyte are amazing and we wouldn’t be where we are today without them. If only I could get funding so we can make the system perfect and add in the new areas people are requesting. Soon, I hope!

      Reply
  • 12. Jane  |  September 14, 2009 at 5:56 pm

    Oh, I know Terrabyte from my days @ CLEAR, they are excellent. You’ve got a good crowd there 🙂 I’m sure you’ve been through all the funding avenues but if I can help in any way with advice of what we’ve been through and learned, just email. We’re still learning too but happy to share if it is any help.

    Reply
  • 13. shashi  |  September 14, 2009 at 6:07 pm

    I had a good read. You have very noble intentions but unless a business is geared to make money whatever the cause it cannot because that is not its intention. Just to quote from your log “DonateNZ began with a business model in 2006. It was not created to make a lot of money, we simply hoped I would be able to earn a living from doing it”
    I feel a charitable organisation should make money and then do charity. The funds then start pouring in. In your case they will because the cause is so noble and selfless. One of the biggest business houses in India called TATA ( multi billion dollar) was set up as a charitable trust. So the cause drives the money.
    I met the CEO of ASB trust fund only last week and she seems to be very switched on person. Have you tried her.
    My good wishes are with you you will succeed.

    Reply
    • 14. clairednz  |  September 15, 2009 at 6:55 pm

      Hi there Shashi,
      Thanks for your feedback and opinions. I think with any charity I think it is an essential component to make funds to sustain itself, in addition to this I think that it should also be supported by donations too. We hope too to have both aspects, as I have mentioned, but it takes funds to make funds, which in terms of our own reserves is not possible as the are completely depleted. Hopefully with some support from another source/s (tbc…working on it!) we can get to a position where this is possible again.
      Thanks,
      Claire

      Reply
      • 15. shashi  |  September 15, 2009 at 9:31 pm

        You will. The CEO of ASB Trust fund mentioned the other day that if you can raise the initial 50% then they can help you with the other part. In your case you have already done that. It may be worth approaching them. Nobody ever gets anything without asking. ( Alladin Factor is a good book to read on this aspect of asking)
        Good luck

      • 16. clairednz  |  September 16, 2009 at 12:22 pm

        Thanks for the heads up, I will get in touch with them.

  • 17. Hayley  |  September 15, 2009 at 4:59 pm

    Hey Claire

    You need corporate sponsorship. My tip – have a think about which large corporate in NZ needs to be associated with something as positive as DonateNZ.

    Sponsorships are definitely a two way relationship – they will require lots from you, it won’t be just a donation, but they will get lots back in return, ie leverage from their support of your work.

    Think about it – every big corporate has their entity they support through sponsorship, and we, as consumers, know who they are.

    I would encourage you to put some real thought into which large NZ organisation your values align with, and who could use the publicity from sponsoring you. Put together a plan, and approach them.

    Just a thought. Drop me a line if you would like to discuss – I could put you in touch with some people I know that are in to the corporate sponsorship game.

    Love your work

    Hayley

    Reply
    • 18. clairednz  |  September 15, 2009 at 6:12 pm

      Thanks Hayley for your feedback and offer to help – have done a bit in regards to this – will send you a message about
      Claire :o)

      Reply
  • 19. Derry Brown  |  September 15, 2009 at 5:29 pm

    Much respect Claire. I know that you will get there.

    “More than five hundred of the most successful men this country has ever known, told the author their greatest success came just one step beyond the point at which defeat had overtaken them. Failure is a trickster with a keen sense of irony and cunning. It takes great delight in tripping one when success is almost within reach.” – p6 Think and Grow Rich by Napoleon Hill

    Reply
    • 21. clairednz  |  September 16, 2009 at 12:22 pm

      Yup have already registered for that. Are you going?

      Reply
  • 22. Melanie  |  September 17, 2009 at 9:46 am

    Hey Claire,

    The team at Good Water totally respects your honesty and transparency and we completely understand what you’re going through. The Donate NZ story resonates very strongly with the Good Water story. We have also been ripped off at the very early stages and have accrued a mountain of debt. It’s also been a very long time since we last paid ourselves a wage!

    But we believe it’s all about the journey and we know that our committment to sustainable packaging will bring us financial rewards eventually. Honesty, transparency and ethics is the only was to conduct business and we are proud of our achievements. You should be proud too. We know everything will work out for you and your family and Donate NZ.

    Reply
    • 23. clairednz  |  September 17, 2009 at 11:25 am

      Thanks Mel, we will keep battling on eh and help each other wherever possible! Love what you guys are doing over there at Good Water. Just sent you an email with an idea how we might be able to work together – Claire

      Reply
  • 24. Annette  |  September 17, 2009 at 9:50 am

    Hi Claire

    Thanks for your candour. I can very much empathise with your situation. Feelings like ‘vulnerability’ become an every day reality and it feels like shaky ground when the every day focus shifts to “where can we get the next dollar to survive another month” instead of “how can I help the next person”.

    In my experience starting up a new charity in NZ can be overwhelming and isolating and yes, running things “professionally” can be a twin-edged sword – credibility on one side and a veneer of financial independence on the other.

    I don’t have the answers for you. We are trying to diversify our funding, but have found that:
    1. endometriosis is common but not sexy
    2. there is only so much money available regionally and it’s under a lot of pressure
    3. everyone expects health-related causes should be entirely government funded

    As someone else suggested, Corporate Sponsorship would seem to offer you the best opportunity. I agree, it’s figuring out which nationwide corporates are a good match. You have the advantage of credibility and a growing profile and being a national organisation with wide appeal(compared with us where there are few regional corporates with an interest in women’s health – and endometriosis is not something that businesses want to snuggle up to!). You have fantastic warm fuzzies to offer as well as solid business nouse which is a valuable selling point.

    It would help if you could find someone to help you locate or introduce you to a corporate looking for a good cause. When they’ve helped you, can you get them to come and see us!

    I would love to offer money but frankly we’re all flat broke around here! Ican offer oodles of moral support and I’m more than happy to be an ear on the end of a phone (or keyboard!) for you if you just want to sound off or run some ideas past someone, as someone who can completely relate to where you’re coming from!

    Continue to believe in your cause – the country needs you – and otherwise you’ll go nuts!

    Reply
  • 25. Virin  |  September 18, 2009 at 9:46 am

    Hi Claire
    It all seems an uphill struggle for you, as it is usually with every noble idea. But with determination and courage (and some funds too !!) you’re able to overcome any obstacle.

    Hopefully, sometime in the near future you will look back at this period and smile at all the hard work with satisfaction, when DonateNZ will touch every New Zealander’s life.

    We all need to realise that we get back multifold whatever we give to the world. So, we all need to spread this message to donate as much as we can comfortably.

    Good luck and best wishes!

    Reply

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