This Entrepreneur Is Proving Philanthropy and Profit Can CoexistThe founder and CEO of GVNG shares how he defied conventional business practices to build a SaaS company helping people donate millions of dollars to charity while also generating revenue and value for its shareholders.
ByJessica Abo•
Dominic Kalms never had any interest in becoming an entrepreneur. "For 30 years, my father asked me what I wanted to do and I always said doctor or lawyer, engineer, something with a little bit more stability in my life," he toldJessica Abo。“但最终我成为一个企业家,因为狗万官方I saw a critical problem and there was simply no solution. And the problem was not an insignificant problem. It was a problem about accessing philanthropic capital and generating philanthropic capital, which is a massive industry in the United States, and more importantly, there's a massive need for it."
Kalms慈善事业部门工作private consultant when he realized he could do something to fix this issue. "Shortly thereafter, I found myself having raised several million dollars and with a staff of 25 people under me, and it was an absolute whirlwind, but I really never had an intention of becoming an entrepreneur. It was just seeing a problem, wanting to solve a problem, and finding the right solution to that problem." Kalms talked with Abo about how his philanthropy technology platform works, how he's trying to help those in need and what you need to know when you're raising capital and building a venture-backed business.
Jessica Abo: Dominic, what is GVNG?
Dominic Kalms:GVNG is a proprietary SaaS platform, a software as a service platform, that essentially reduces 98% of the cost, labor, and time of starting, running and operating a 501(c)(3) nonprofit vehicle. Nonprofits are extraordinarily expensive to start, very time consuming and very labor-intensive. In fact, the average cost of starting a nonprofit can run you upwards of $25,000. That's just in the first year. Not only that, but there are hundreds of documents which have to be filed at the federal state and local level and require tens to hundreds of hours of man hours, lawyers, accountants and compliance officers. I mean, it's extraordinary that we make it this difficult to start a nonprofit charitable vehicle. And so what we did with GVNG is we created this proprietary software and we work with our partner GVNG.org as a backend philanthropic vehicle in essence creating what is a nonprofit in a box.
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That's how we originally started out and we've had extraordinary success in creating thousands of nonprofit projects that are bringing in millions of dollars a year in philanthropic capital. And now we've pivoted more to the B2B side, where we're working with banks and credit unions to provide instant charitable accounts that they can then offer to their employees and their customers and consumers as well. Imagine next time you go to your bank and the bank says to you, 'Okay, you opened up your checking account, you've opened up your savings account. We're going to offer you a charitable account.' And you can actually take a portion of each paycheck for example or every deposit you make and put a portion of that into your charitable account, get an immediate tax deduction and the funds are sitting there and ready to be used to be distributed out in the form of a grant whenever you'd like to do that, and supporting hospitals, schools, other causes, humanitarian relief organizations or even just your local library.
What's unique about GVNG is that we have the ability to allow crowdfunding as well in a tax- efficient infrastructure. On GVNG, the donor is making a donation so they get a tax receipt and the recipient organization actually doesn't pay federal or state income tax. You can imagine at scale that you can raise billions of dollars in a tax-efficient way and create philanthropic capital that would not exist if not for the infrastructure that GVNG provides which allows this to be done virtually instantly. We're cutting down on average 98% of the cost, labor, and time of starting these types of organizations.
How have you used GVNG to respond to COVID?
Kalms:When COVID hit in early March and April when it got quite bad, we noticed that there were so many organizations springing up all over the place and it was very disparate and completely disorganized. One of the things that was a critical need was PPE. As you might remember, there was a national PPE shortage. What I did is I spun up my own nonprofit project on GVNG called EndCovid-19.org and I called up a bunch of my celebrity friends with my partner Israel from CharityBids. And what we did is we had this big celebrity auction campaign that we partnered with Charity Buzz on. Then we had all these celebrities basically auction off 15-minute private videos for their fans. People would basically go and they would bid on these videos and then whoever would win would have a private one-on-one conversation with their favorite star. And we were able to raise over a hundred thousand dollars in about, I would say, four weeks for this campaign. And then we took those funds and we purchased tens and ultimately hundreds of thousands of units worth of N95 respirator masks, face shields and gloves and we donated them to the hardest hit areas throughout the country.
What advice do you have for someone who is about to start raising capital?
Kalms:The biggest advice that I would give to somebody who's just starting a company or starting to raise capital is truly only start that venture if you are absolutely, uncompromisingly passionate about what you're doing. When it's 4:00 AM on a Saturday night and all your friends and family are out there partying and having a good time and you're sitting alone in your basement or in your bedroom typing on a computer, and there's nobody there to encourage you, the only thing that's going to drive you is passion.
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My second piece of advice is never, ever accept other people's limitations. People will tell you, 'Hey, this can't be done,' or 'That can't be done.' In fact, there's a famous quote by Nelson Mandela, 'It always seems impossible until it's done.' And I can assure you there have been people that have persevered for much worse things and much harder things. People have lost more than you. There's always someone who's gone through something harder. And at the end of the day, I think one of the primary things that separates human beings from all the other species on the earth, is an uncompromising indefatigable spirit of perseverance.
How do you think businesses and entrepreneurial ventures can create a social impact while making a profit?
Kalms:Businesses can achieve impact while also generating a profit fairly easily. I think it's actually imperative that they do so. I could go on and talk about cause marketing and how it benefits the bottom line of corporations. But I think the reality is, this country and the world are in desperate need of fundamental systematic change. And if you look at where this country has been going over the last forty or fifty years, you look at the wealth inequality, you look at the lack of resources for millions of people, the number of people on food stamps, the number of people in poverty, it's absolutely extraordinary. We have the means to solve these problems. It's not a question of do we have the means. We have the means.
If you listen to the Intergovernmental Panel on Climate Change, they say it's about $13 trillion to reverse climate change. If you listen to Jeffrey Sachs, he said global poverty can be cured with $175 billion investment over a 10-year period. I think it's imperative that companies put in a social impact ethos into their brands, not as a nominal exercise, not as an exercise to brag and use it as a cause marketing ploy, but actually because they care about their communities.
