We are very excited to announce GiveForward has raised $500,000 in its first round of funding.
After meeting some fantastic people during our participation in Excelerate, we were able to do some creative fundraising and are now ready to expand on the services we currently provide. With this backing we will now be able to grow our team and bring on additional fundraising coaches so we can continue to provide the best service possible to our fundraisers.
Feel free to check out the story featured in the Chicago Tribune, TechCrunch and FastCompany:
By Wailin Wong
Posted today at 8:45 a.m.
GiveForward, a Chicago-based startup that helps people raise money for out-of-pocket medical expenses, has raised $500,000 in its first round of funding.
Desiree Vargas Wrigley and Ethan Austin started GiveForward in 2008 and had looked for some funding at that time, but “what we kept hearing from investors is: ‘You should be a non-profit,’” Vargas Wrigley said. She and Austin funded the company themselves, with Vargas Wrigley waiting tables at Cafe Ba Ba Reeba in Lincoln Park in the meantime.
The GiveForward platform allows people to create personalized fundraising pages and share their cause through social media such as Facebook and Twitter. GiveForward collects the donations, which can be done through credit or debit cards, and passes them along to the beneficiary after deducting 7 percent for processing fees. The company said its users have raised $3.5 million since the company’s inception and about 10,000 users have joined the site, with almost half of them signing up in the last six months.
In 2010, GiveForward was one of 10 companies chosen for the inaugural class of Excelerate, a Chicago-based program that awards funding to startups and provides mentorship from experienced investors and entrepreneurs. Through the Excelerate program, Vargas Wrigley and Austin connected with Tim Krauskopf, a serial entrepreneur and former Motorola Inc. executive who had co-founded Spyglass Inc., the software firm that developed the basis for Microsoft’s Internet Explorer browser.
Krauskopf gave the GiveForward team advice and cultivated a group of investors behind the scenes. He became the lead investor for the company’s fundraising round, which also includes several angel investors and New World Ventures, the Chicago venture capital firm that invests on behalf of the Pritzker family.
“There are a lot of fantastic new tech ventures coming out of Chicago right now and GiveForward is one of the best,” Krauskopf said in a statement. “It is a truly viral service that leverages social networking for a real, productive purpose.”
The $500,000 will allow GiveForward to expand its staff. Austin and Vargas Wrigley drew their first paychecks in January and recently hired a marketing employee and an in-house developer. Vargas Wrigley said the startup plans to hire another five to seven people this year, with most of them serving as fundraising coaches that work one-on-one with the site’s users.
GiveForward also plans to work more closely with hospitals and private clinics so doctors and nurses can recommend GiveForward to the families of patients that might be struggling financially or could benefit from the support of an online community, Vargas Wrigley said.
Vargas Wrigley said her startup’s success in getting funding speaks to how “the funding climate is changing in Chicago.”
“Companies really can be mission-driven or social ventures and still produce return,” she said.
GiveForward Raises $500K To Be The Kickstarter For Medical Expenses
By Leena Rao
Posted today at 2:40 p.m.
GiveForward, an online fundraising tool for medical expenses, has raised $500,000 in funding from Tim Krauskopf, New World Ventures, David Cohen, Ed Chandler, Social Leverage and Excelerate Labs.
GiveForward, which was incubated in Chicago’s Excelerate Labs, wants to become the Kickstarter for medical expenses. The platform allows anyone to create customizable fundraising pages where friends and family from across the world can donate online.
To make money, GiveForward deducts 7 percent of all donations. Since 2008, 10,000 users have joined GiveForward with the startup helping families raise nearly $3.5 million for their loved ones’ out-of-pocket medical expenses. GiveForward also gives users tips on fundraising, allows them to socialize their pages on Facebook and Twitter and more.
BY Ariel SchwartzMon Feb 14, 2011
Regardless of your stance on the health care debate, it’s hard to deny that treatment can be scarily expensive for the uninsured. GiveForward, a Kickstarter-like site for medical expenses, tries to relieve the monetary burden for patients by giving them a fundraising platform. And now GiveForward has raised $500,000 in its first round of funding.
Since its inception in 2008, GiveForward claims that it has collected 10,000 members who have raised a total of $3.5 million for various medical causes, according to Chicago Breaking Business. A quick search of the site yields some impressive findings. One member raised $31,000 for medical expenses related to a brain tumor; another raised $11,295 for lung cancer treatment.
There’s just one problem with GiveForward: the site docks 7% of all donations to make cash (as a comparison, Kickstarter takes 5% and passes on the Amazon credit card processing fee of 3% to 5% to the end user). Surely the company (and Kickstarter, for that matter) can find a more workable business model.
“We’ve had people raise up to $88,000 using the site and most of them realize that this is money that they would never have been able to raise without GiveForward. Of the thousands of families we have helped over the past 3 years maybe a handful have told us that our fees were too high.,” explains co-founder Ethan Austin in an email. “The reality is that we didn’t start the business because we wanted to get uber-rich. We started this business because we LOVE helping people. I lost my father and grandfather to cancer as a child and my co-founder, Desiree Vargas lost her grandfather to cancer. It is something we are both very passionate about and creating GiveForward was our way of being able to give back.”
Regardless of motivations, the site is continuing to grow. GiveForward’s cash infusion will go toward hiring fundraising coaches to work with site members, as well as toward efforts to work more with clinics and hospitals on connecting patients with the site.
Follow Fast Company on Twitter. Ariel Schwartz can be reached by email.
