I was a history teacher for 11 years and finally after a lot of soul searching, I took a leap of faith, burned my ships, and left the profession this past May to start my own business. Something I've always wanted to do but never had success in doing. I saw how popular subscription boxes had become and was introduced to a real need by charities and non-profits to connect with donors that then gave me a simple idea.
How to make charity fun and exciting?
It's been scary (no backup plans) , it's been exciting, it's been nerve-wracking, but after a summer's worth of work I launched my own start up!
Charity Crate is a monthly subscription box devoted to charities. Each box not only comes with a shirt and great swag from a deserving charity, but a 60% donation that goes straight back to them! It's a great way to discover new charities for the causes you are passionate about, but also helps raise social awareness and funds at the same time. Think of it as kinda like a mini Kickstarter for charities!
So yeah, I'm an educator, newbie entrepreneur, single father and Dutch Brothers coffee drinker. Ask me anything!
Proof 1: https://i.imgur.com/JqstLoV.jpg?1
I hope this works out for you and the charities involved. I don't personally get it. Is swag that big a draw to people? I would not personally like a monthly bumper sticker and t-shirt from a charity I don't actively support beyond the blind 60% of the cost of a box. Charity donation just seems too much of a personal values thing to me to accept this concept. But if it works for others, raises awareness of causes, and financially benefits the organisations then fair play.
Charities have a problem in that they struggle to gain donations. Many live and die by what they bring in despite the help they provide.
Charity Crate is designed to make charity fun and social through the appeal of subscription boxes. On signup you can choose to support animal, children, or environmental based charities every month to make sure what you support is personal to you. We do want you to feel connected.
Part of the appeal is discovering new amazing charities monthly. Subscribers can learn about new causes, get some cool stuff from them in return and feel good knowing they helped support something awesome. That's cool. That's a fun feeling.
And if you have a personal charity you are truly passionate about, then by all means give to them! But if you wanted to give a little more, thats where we come in. Charity Crate allows people to give AND get back. Hopefully that appeals to people who might not otherwise give.
Have you done extensive research into the charities you're supporting?
There's a lot of questionable ones out there no doubt, which unfortunately give the rest a bad name. But like anything, if you do your homework you'll see which ones really shine through. First thing we want to do is make sure they are established and have created a legacy of work over time. There's also websites that review and rate organizations that's helpful. And like any business, often just reading the comments and reviews people leave is very telling. That's already helped a few times since we started.
I manage some of the corporate grants for my company in my spare time and one thing i've always wondered about is whether it's more impactful in the end to focus on the larger charities or help out some struggling ones (lesser known ones like you're doing).
One example from the recent past is that there are two nonprofits in my city that focus on helping recent and low income immigrant children with after school education and summer programs. One is large and includes a low income daycare, after school programs, leadership camps, library, etc. One is small and only has after school programs. They are about 4 blocks from each other and serve similar age groups and demographics. They both make a pitch but I ended up deciding to provide the grant to the larger group since they can use economies of scale and their already purchase physical resources (library, daycare, community center) to do more for more people. But the smaller one may have to close if they don't get more donations, which is bad because they do good work, but based on the numbers the bigger one can help 2x the kids with the same money as the smaller one.
Is this something you consider when choosing smaller organizations? Do you compare what other bigger ones might be out there and how they might overlap/do more with the same money with the larger infrastructure? How do you make these calls?
That's a tough call to make. And one that resonates here.
The goal when we started was to put a spotlight on the lesser known charities and make them look like the rockstars they are. Our model doesn't charge them for any of our services beyond the supplying of materials for our crates and even then we have wiggle room with the 60% to fix that if they choose to use it that way.
My feeling is that the bigger charities will more often be able to fend for themselves while we want to work with the underdogs. But there is a balance and I wouldn't be opposed to partnering with more established ones from time to time, if only sporadically and it makes sense.
What benefit does your crate really give over a simple online monthly newsletter highlighting lesser known charities? Do people care that much about getting shirts for random charities they likely have never heard of before, and may never donate directly to in the future?
What happens when people decide to just donate directly to the charities they discover through your crate and cut the unnecessary 40% middleman out after a few months?
"What happens when people decide to just donate directly to the charities they discover through your crate and cut the unnecessary 40% middleman out after a few months?"
Awesome! Then we did our job!
There's a HUGE demographic out there who gives more to charity than anybody else. Can you guess who they are?
Problem is they give less frequently than any other demographic.
Charity Crate was built to appeal exactly to that group. What if we could make charity something fun that you looked forward to every month? It doesn't cost a lot, but it gives a lot back AND you get cool stuff delivered to you in the mail? Millennials can give and get back. And why that may not be appealing to everybody, I think we can agree to a lot of people, it does.
It's really a different approach to giving that we hope takes off. Dont think of it just as a "subscription box" or just as a "donation". The concept behind it is really more akin to crowdfunding. But for charities.
How has the response been? Has it been successful so far?
I am not sure about people wanting to give 60% to get a crate, versus simply giving 100% to the charity.
Thank you for doing this and for your 11 years of service!
We just launched last week so we are dealing with the growing pains of early marketing.
But, 100%, every charity I've personally talked to loves the idea. It's really a never ending struggle on their end to raise money. Not only do they get a large donation from us, they get a chance to personally share their work with caring people and receive a huge boost of social awareness when boxes are shared with family and friends. The goal from the start was to make charity a fun and social experience and that's something that appeals to everyone so far. They want to look hip lol.
Do you pay the charities for cost of them shipping and distributing their “swag” to you?
Since you are a for-profit company, taking 40% of the monthly subscription to “keep the lights on”, it concerns me that charities are having a significant portion of their 60% of donations allocated to shipping costs.
From an ethical standpoint, allocating 40% of a donation to a 501(c) organization in order to support a for-profit company seems a bit ludicrous. I understand that you support people donating 100% of their contributions directly to charities, but unless you subscribe and pay a monthly fee to your for-profit company, non-subscribers have no access to see which charities you are supporting each month.
Totally understand your comment.
However, subscribers are not sending a donation when they enroll. They are purchasing a charity themed subscription box. That box just happens to send 60% back to each partnering charity as an added perk. The model is not to "take" 40% away, it's about giving the 60%.
There are actually a ton of other subscription boxes out there that look to help out and give back. Most though only donate around 10% back. Keeping 90% for yourself is a business model I'd love, but not one that I'd feel good about boasting about if I claimed to help out others.
What do you miss about teaching? And what don’t you miss?
I won't say all of the kids, but most of em, lol. Friends on staff of course.
I knew the moment I left I'd miss the open routine of it all. As a teacher of course there are standards and requirements you have to cover, but the freedom you have to essentially be your own boss and teach them how you saw fit was a freedom I knew I'd miss.
When I had to teach the Constitutional Convention I'd divide the class into groups big and small then have them argue over how to best vote for class privileges like early release or extra credit. The class quickly saw the problem when the bigger table kept voting to keep the extra credit for itself. Or when I taught McCarthysim I'd make a big deal during notes that I found "evidence" of cheaters on our last test in a big manila folder I'd wave around to scare em. Only at the end of class would I reveal it was just a joke. (I did have one student confess out of guilt once)
What I wont miss? Lesson planning. Emailing. Grading. Endless meetings. Teaching is such a bureaucracy these days but don't get me started. It's really what's killing our classroom and kids I'd argue.
In line with the last comment, do you think that taking a 40% cut from charities is reasonable? I get that you need to make money to be sustainable, but do you think some customers would be put off by that?
When I started it was originally 75% at concept.
If I was asking for straight donations with nothing in return it would be quite unreasonable to subtract 40% of the gift. But subscribers also get back when they give and that makes a huge difference. Don't think of Charity Crate's concept as a donation as it really isn't. It's a fun subscription box you get that happens to give a heck of a lot back.
Also, like any business there are fees to keeping the lights on while still maintaining profitability.
And keep in mind, there are big organizations out there where only 10% of what people give actually makes it to the stated purpose. That's the real crime if you ask me.
What kind of due diligence do you do regarding the charities financials? Do you keep track of how much of donations go towards the cause vs operational expenses? etc.
edit: or use a watchdog service.
This is the million dollar question when it comes to giving to any charity isn't it?
I don't run their organizations, nor do we don't dictate where the money donated goes. But that's all part of doing our due diligence and partnering with organizations that have proven they do what they say.
That’s a cool idea I’m not sure if I really see a long term plan for it. I pay a subscription to you, you choose a charity it goes to and then 60% of what I pay goes to the charity as a donation. Do people get options of what charities they want to get? There’s a lot of pretty predatory charities that run as a business looking for profit first and a charity second. I’d imagine even if you do serious research and make sure the charities you pick are good, eventually you’d end up grasping at straws to find the next one. I don’t know if I’d let that be my main job/income. Again, it’s a cool idea but maybe better as kind of something on the side that isn’t going to hurt when it dries up
Thanks! We think it is a cool idea too!
What we offer is first and foremost a subscription box first. That is what you sign up for. That is what you purchase. Yes you can choose to support new animal, child, or environmental charities each month depending on what you matters to you. We vet seriously the organizations we work with to make sure we promote charities that have earned it. You discover new charities, get a shirt and fun stuff mailed to you monthly, and we send a sizable donation back for every crate shipped.
It's really more like a monthly Kickstarter for deserving charities in need than anything else. You get perks, they get help.
Above all we want to see they contribute something good back to our three focuses, which are animal, environmental, or children based charities.
Second, that they have an established line of work that shows they do what they say.
Then the conversation becomes one of what can they offer for our boxes. Some organizations were happy to participate but didn't have enough materials at the moment to fill a box. That doesn't mean we won't work with them later, but for right now as we are growing, our flexibility is small.
The charities you choose - is there any criterion for it, geographical location or otherwise?
As long as they are based in the US, have a proven track record and reputation, want to partner with us and have enough items to donate for boxes we are good to go!
And they must fit with our current selection of causes which are supporting environmental, children, and animal based charities.
There's more to it of course, but those are the major areas.
Just curious. If you had to pick one of those 3 to support, which would you and why?
Where are you based out of?
We are in Phoenix AZ.
It's 101 outside today so I appreciate the excuse to stay indoors and answer questions on here. Muchas gracias!
Why is only 60% of the funds going back to the charities?
That’s on the lower end.
Maybe I’m comparing apples to oranges, but the charities I like all spend at least 90% of the donations on their direct causes (marketing, admin, overhead etc make up the rest).
Charity Crate, (despite having charity in it's name) is not a charity or nonprofit in itself. We only work with charities and nonprofits to promote and advertise their work.
What sort of swag will be in the boxes? Is it what the charities offer? Does it have their names on it?
I love this idea. I love the idea of subscription boxes and I love the idea about learning about reputable charities. Good luck in your endeavor! I'm full of questions. I'll post them separately.
Every box every month comes with a shirt no matter what, and then the items the charity can provide. So it does change. But yeah it would have their name on it. Our first charity really knocked it out of the park with what they put in their crate. You'll have to wait to they get unboxed but damn, super cool organization and super cool swag.
Charity Crate is like a box of chocolates i guess! Ooh, that's a good ad!
No. Interacting and answering questions like this is invaluable. And I appreciate all the input, positive and negative.
Know your market!
How do you envisage the risk going with this?
Two scenarios spring to mind:
1) a charity takes a bold decision (as they should) to speak out about a controversial topic in between you shopping boxes and them arriving. Half of your customer base object to the moral stance and cancel. What happens to the business and how exposed are charities that have already invested.
2) Similar but on the other end of the scale, a charity gets embroiled in a scandal, and the public turn en masse. Meanwhile your boxes land on doorsteps and enrage your customers. Again, if you have significant unplanned attrition, how protected are other charities both in terms of their financial outlay and association with brand?
Additionally, how do you reconcile scale? Are you floating costs or are charities having to provide excess stock based on your projections? If you have a deal with a hospice, and you’re subscriptions blow up, how many more T-shirts are they now under pressure to produce or does your model allow for this?
It’s an interesting model and I think as long as it doesn’t cannibalize existing donors it could do well at opening up new markets. I do worry about how quickly you run out of charities that just don’t get it though. It’s a famously not commercially savvy business and the 40% margin might prove a significant barrier to entry regardless of actual success of the model.
The biggest risk right now is that the idea is terrible and nobody wants to subscribe lol. It's a different approach to both subscription boxes and charitable donations and it may take some time to catch on.
With regards to your worries, that is a real concern. However, we mitigate that by choosing to work only with established, if yet relatively unknown, charities. Nothing political or controversial. If that's your thing then more power to you and by all means we encourage people to give personally to those entities they connect with.
I don't see any children's cancer research organizations all the sudden coming out against Chinese tax tariffs if that's what you mean. But never say never right? :)
Scale? We have our monthly projections on how many items are needed for each box. (Ssssh! Right now those projections are low) but as we grow I think we can stay on top of it. If a box was ever to blow up we'd have to have more product supplied and unfortunately that results in late shipping. Loot Crate is famous for this I've heard. Not ideal, but a good problem to have right?
So you're putting the profit back in non-profit?
Collecting taxable funds so that you can turn around and donate them to a charity and write the whole thing off?
How does this help reduce the already excessive administrative expenses that most nonprofits are already paying?
I was advised by more than 1 accountant to actually donate LESS so Charity Crate wouldn't get killed by taxes at the end of the year as there is a maximum charitable donation one can make before getting dinged.
But doing any less defeats the purpose of what Charity Crate was designed to do.
I will say this, if we gave any more, we would not last long. There is a reason other subscription boxes only give back about 10% I quickly learned, lol. But they have a different cost structure than ours to be sure.
What makes you finally take that leap of faith after 11 years?
Failure and fear of failing.
I've tried before to work on little projects while juggling my job and fatherhood. They all sputtered out as I'd get burnt out from working a demanding job then coming home to try and be productive still. Everything felt half-assed as I was being pulled in too many directions.
Teaching is a TIRING job. I'd joke it's mental gymnastics all day long. Who's out in the bathroom? How long have they been gone? What studenst are currently working on task? Which ones need a little extra help or motivation. New email? Do I have time to check it? I need to tell Timmy to put his cell-phone away. Yes the pencil sharpener still works. Is that kid back from the bathroom yet? How much time until class ends? Do they need 5 more minutes to work or should we move on? Tell Sally to sit down. Also be ready to answer ANY question that comes up at ANY time and also teach an engaging well prepared lesson on top of it all. Phew! You do get a 5 min break between classes if that helps though, lol.
How much money are you making personally from running a charity?
We are not a charity.
And how much money have I made so far? Somewhere around -$2,000 so far and counting, lol.
"Don't quit your day job!" Opps. Too late!
How many boxes/charities do you have lined up so far?
Right now, since we just started 4, with a bunch of others waiting with interest. We only started selling like 2 weeks ago. We're subscription box newbs lol.
Doesn't attempting to profit from middle-manning for cash-starved charities leave a bad taste in your mouth?
You have to realize that these smaller charities are STRUGGLING to compete and get their name out there for donations.
Charity Crate provides a welcome service to promote their cause in a fun and sociable way that also gives back. I've talked to a bunch of PR and marketing heads at a lot of charities these past two months and not one was against the concept. On the contrary, nearly everybody was super excited and one even said it was genius.
I actually got the idea after listening to some of my kids participate in an Apprentice/Shark Tank style contest where they were tasked by local nonprofits to find a way to connect with younger generations. Cause they just couldn't connect but knew there was a market out there they had to work with.
Interesting idea - who is your target customer?
Studies have shown they care more and give more than any other demographic. But for understandable reasons they give less frequently. If charity could be something fun and appealing then maybe we can reach them better and in turn generate more help for these deserving causes. It's a market that is really being undeserved if you think about it.
My wife recently quit teaching elementary ed down here in Broward County to open her own hand-made jewelry business. What pitfalls can you point out for someone in your/her/our situation that you wish you'd known from the get-go?
Good for her! I used to teach an entrepreneurship class as well as my beloved history and one thing I always wanted to ingrain in my kids was to get out there and JUST DO IT!
The biggest pitfall? Patience, lol. We all want success. But it takes time to build and grow. You need to preserve, stay steady, don't get too high or too low.
I wish her luck and success!
Are you a non profit?
No. We are a for profit that works with nonprofits.
My accountant has suggested we look into one day maybe becoming a nonprofit, but that would require some restructuring and we're not that far yet. Is there a possibility one day we may be? Perhaps.
Many questions, sorry 😐.
You’ve mentioned the boxes came with a shirt. Do you ask the client their shirt size?
Do you keep stock or ask charities to send you on demand?
Do you charge separately for shipping?
Do you support only local organizations?
Yes, we ask for shirt size upon order.
Currently orders are set up to demand. If we have 70 animals boxes to ship by next month we ask for 70 boxes worth of supplies. No extra waste on their part or ours.
Yes, you pay separately for shipping. Damn shipping!
No, we currently support organizations based in the US only.
In a world of Susan G Komen's and Wounded Warriors raking in massive profits, I gotta ask: what's percentage of the donation goes to administrative costs?
Exactly! Those big corporate style nonprofits are what we want to be the opposite of. They have huge administrative overhead so it only makes sense a fraction of what is donated goes towards helping out. I get it. It makes sense. People still give to them in huge amounts and they do great help.
But think of all the other charities that suffer cause the big boys suck out all the oxygen from the room? When you see it that way, you understand why Charity Crate was founded. Give those those little engines that could the push and recognition they deserve!
Also, smaller charities have less administrative costs so keep that i mind. What they do with the money we send is up to them. But that goes hand in hand with vetting them first to make sure they do legit work.