What are some interesting non-tech startups

Tech & Nature

Startups and large companies work together on innovations - this is now a well-tried concept. On the other hand, the partnership between non-profit organizations and startups is less established, but there is great untapped potential here to make the world a bit better. Jörg Reschke and Claudia Winkler dedicate a separate chapter to this area in their book "Online Fundraising" published by Springer Verlag, which Tech & Nature is allowed to publish here in excerpts:

Digitization in the non-profit sector can be expanded

There seems to be a fundamental willingness to implement digital technologies in the non-profit sector in Germany, Austria and Switzerland. In many discussions it becomes clear that the digital change is seen as necessary in order to react to the increasing competitive pressure in the market and to secure opportunities for efficiency and increasing donations. Decision-makers in the non-profit sector, however, face the same challenges as numerous small and medium-sized companies: for example, compliance with data protection and the renewal of the IT infrastructure with a low investment budget. In addition, the skills of employees in dealing with digital technologies must be further developed. This partly leads to the fact that the degree of maturity of the technologies and their actual application in practice diverge and that the NPO sector lags behind in terms of digitization.

COVID brought digitization

For example, the donation market in Austria has hardly been digitized. New Austrian digital-only solutions from startups but also from NPOs (if available) have not yet been able to establish themselves on a large scale, even if the COVID crisis has given the sector a boost to digitization. According to the 2019 Altruja study, organizations identified online fundraising as the most important donation channel of the future. In terms of donation income, however, those from the online area are currently only in the lower range: A large number of NPOs (40.65%) indicate that online donations currently make up 1-4% of the total donation volume. 12.3% of the organizations already achieve a volume of over 16% of the total volume. (Source donation report 2019 Fundraising Association) This number applies to the entire DACH region, according to experts, the digital share in Austria is far below this number.

Digital social businesses often fail because of scaling

Tech-affine impact startups have technological know-how but have a "cold start problem". They only manage to market their innovative solutions at great expense and encounter hurdles in attracting NPOs as communication partners, as they often do not know the real problems and processes of NPOs. The impact of charity tech startups such as impactory, goood mobile and NPO's own digital solutions is currently still manageable in Austria. The most established digital fundraising innovation in Austria in the last 10 years is aufrunden.at which, according to the latest press release, has generated EUR 1 million in donations in 7 years in cooperation with Caritas. According to information on the website, Respekt.net has achieved EUR 2.5 million since it was founded. The solutions are constantly growing. In general, the success of digital solutions in Austria is still very manageable compared to conventional channels. With the exception of Ecosia, share the meal and the German platform Betterplace, hardly any solution has been able to achieve product / market fit and grow massively and thus become a social innovation that affects society as a whole.

Collaboration as a solution

But it is precisely these scaling digital social innovations that we will need in our society in the future in order to meet global challenges such as climate change and increasing inequality.

The big question for many organizations, large and small, is how to successfully allow and scale innovations so that real social change can occur. From our point of view, one key to this is cross-sectoral collaboration. Three collaboration approaches from the field of digital fundraising show how this can be achieved.

1. Collaboration in product development

The key to innovation is overcoming organizational and disciplinary boundaries. Innovations tend to be new combinations or hybrids of existing elements rather than being completely new. Cooperation and systems thinking can help to implement new approaches for digital impact innovations with less effort. This works better than if they are only developed within your own organization.

It takes courage to step out of your own organization and find partners with whom you can work towards a more sustainable future. As part of skill-based corporate volunteering, companies with digital know-how are often ready to provide support with their specialist knowledge. Nonprofits can also involve supporters in the same way. They have the advantage over traditional companies that they basically have a very loyal support base who are happy to participate in the further development of the organization. These supporters are the target group when it comes to surveys to generate ideas or feedback on new digital prototypes.

An often neglected approach to cooperation is partnerships with social entrepreneurs from the digital sector. They are very promising and are already being implemented by the first leading organizations such as Caritas Vienna or SOS Kinderdorf, which actively work together with social businesses. But the cooperation is mostly driven by social businesses. The donation platform faimittlerei is an example of how innovation is made accessible to NPOs from the social business sector. It solicits donations in kind that are as good as new and mediates them to non-profit organizations. It acts as an interface between industry and organizations and is open to partnerships.

2. Collaboration in the area of ​​transparency

People want to be involved in different ways. Successful organizations recognize this and communicate little things that people can do in their lives to make an impact. They help supporters track the impacts they are contributing. In doing so, they turn their sponsors into ambassadors for a good cause and at the same time strengthen the bond with the non-professional organization. The trend towards greater involvement also explains the increasing popularity of peer-o-peer fundraisers.

A lack of transparency and traceability is a major barrier for supporters of social organizations. Up until now, creating transparency was time-consuming and expensive for NPOS. New technologies open up new possibilities, e.g. the greatest potential of blockchain technology in the NPO fundraising area lies in the chance to build trust in the use of donations and thus to address more donors. Thanks to blockchain technology, donors can always clearly track the path of their donation. A well-known example from Austria is the Token4Hope project. The system was developed by the startup Collective Energy together with the Viennese aid organization. It is a cashless, transparent and tamper-proof donation system with anonymized data based on the blockchain. The system brings donors and recipients closer together and can in future make peer-to-peer, i.e. direct, transactions possible.

3. Collaboration in the field of "sustainable consumption"

Nobody will doubt that we are living in a time of upheaval. Climate change requires a significant rethinking of our consumer behavior, the advancing digitalization is not only changing the world of work, but also determines the buying behavior of entire generations. The importance of social media, especially for the younger generation, has fundamentally changed information behavior and makes this target group extremely difficult to reach for traditional communication channels such as the daily newspaper TV news.

New economic models are emerging in which an ever larger group of people prioritize community and sustainability over rapid growth. According to a study by Polycore and Spiegel, 89% of those surveyed state that they want to live more sustainably in the future. Circular economy concepts are booming: local, organic farming, crowdfarming and the like.

Offers from purpose companies that also gear their products towards social commitment are becoming increasingly popular. Share is an example of this. With the purchase of a product of this brand in partner supermarkets like REWE and DM you help a person in need: Each organic nut bar donates a portion of food, each hand soap dispenses a bar of soap and each bottle of water dispenses drinking water for a day. It is essential that the products are about the same price as comparable products. Offers from purpose companies can now be found in many industries: One euro of the proceeds from the Soulbottle glass bottles is donated to water projects, as is the case with Viva con agua. The social mobile communications provider goood mobile is following a similar path in the mobile communications industry by donating ten percent of the monthly basic fee to a non-profit organization that the customer selects individually.

Social projects and nonproft organizations can see this economic change as an opportunity. You can either diversify your portfolio yourself with social products through non-purely altruistic offers, or you can work with companies that are active here with the same values.

Change together

The great fear of many established NPO organizations is that digitization projects are too large and expensive for the organization. Fearing that the effort will be too great and that one could fail, some organizations stay on the safe side and only do the bare minimum. However, NPOs are under pressure because they are inferior to other organizations in terms of digitization. The development of technical know-how and interest in digital trends is an important prerequisite for established organizations in order to be able to survive in the long term. Digital offers have to be continuously adapted and optimized.

However, this requires a basic digital understanding and an agile management style, which often still has to be developed in many non-professional organizations and social projects. The battle for digital talent in the job market is great and it is high time for non-proft organizations to position themselves in this field. The management of innovations is not a one-time expense. Digitization, the testing of prototypes and constant optimization of the measures are the new day-to-day business also for NPOs, which often reach their limits here.

At the core of its mission, the social business community is geared towards collaboration and can test and introduce digital social innovations in cooperation with established organizations. This offers NPOs opportunities for innovations that often cannot be carried out themselves within existing organizational structures due to a lack of digital know-how, and social businesses the opportunity to more easily scale their digital approaches in cooperation with established organizations. The social entrepreneurship networks SEND in Germany, SENA in Austria and CooperativeSuisse are contact points to get a feel for the possibilities of the sector.

This article contains excerpts from the book "Onlinefundraising- How you successfully finance social projects and organizations" (Ed. Jörg Reschke), published by Springer Verlag in early December 2020. Comprehensive information about the book here: https://www.digitales-fundraising.de/

About the authors:

Jörg Reschke and Claudia Winkler are co-authors of the book Online Fundraising recently published by Springer Verlag. They are passionate digital-social innovators and entrepreneurs. With their diverse projects such as goood mobile or good deeeds in the DACH region, they contribute to a more sustainable world. Both are very interested in exchange and collaboration.