IGive.com founder Robert Grosshandler was easy to spot during the dot-com boom.
He was a tall guy in a navy blue iGive shirt, talking about how the Internet would revolutionize charity by giving online shoppers a chance to earmark a percentage of every purchase for their favorite causes.
With one eye on 50-odd competitors–online charity malls were big in 2000–and the other on iGive subscribers, Grosshandler and his 60 employees believed it was possible to have fun, make money and do good–at the same time.
Today, Grosshandler still wears his iGive shirt, though the color is fading. Most of iGive’s competitors have folded or morphed into software firms.
Nearly all of iGive’s employees have found other jobs. They were laid off before Grosshandler moved the Evanston business back into his home 13 months ago and began sleeping with a laptop beside his bed, listening for a beep that warned him of trouble on the network.
Even so, the 6-foot-5-inch entrepreneur, one of five remaining employees, says he’s having fun.
He’s also doing some good and making some money, though not as much as he and his investors envisioned.
As a vehicle for reinventing philanthropy, iGive is a dud. The for-profit venture spent more than $7 million of investors’ money since 1998 while giving less than $1 million to charity. (“These are the things that keep me up at night,” Grosshandler says.)
But as a going concern–a survivor in a landscape littered with failure–it’s succeeding.
IGive got pumped up with money during an extravagant time when greed and idealism mingled in equal measure. Now it’s back to its roots as a growing small business with a passionate, 46-year-old founder who believes that charity is a powerful motivator for customer loyalty–and that people care most deeply about causes close to home.
Grosshandler, a successful software entrepreneur, started a business in the mid-1990s broadcasting messages to conventioneers about the cities in which they were meeting.
That business–sold in 1996–got him thinking about using interactive advertising on the Web.
At the time, plenty of Web sites were giving away free services to attract large numbers of subscribers who, it was presumed, would make these sites more valuable to advertisers.
Grosshandler figured the model was flawed. How valuable are customers who sign up for freebies?
On the other hand, when his daughter started kindergarten, he witnessed the time parents devote to their local PTAs. Ditto his actor wife’s never-ending efforts to raise money for local theater productions. Now that was loyalty.
It was a short leap to iGive, which he started with his own money in November 1997.
Online shoppers interested in donating register at iGive, which lists 336 participating retailers as varied as Best Buy and Enterprise Rent-a-Car.
When a shopper makes a purchase, the merchant pays iGive a prenegotiated commission. After taking its cut, iGive forwards the amount posted on its site–generally between 2 percent and 8 percent of the purchase price–to any cause designated by the shopper.
Animal welfare groups are popular among the more active of iGive’s 175,000 subscribers.
Grace Konosky, who runs a no-kill shelter for German shepherds in Burbank, Calif., has been a beneficiary. She recently got a check for $781.42.
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“I had no idea where this came from,” she said, as a dog barked in the background, “but it’s very, very appreciated.”
With online shopping finally taking off, iGive’s biggest remaining problem was that shoppers didn’t always visit the site before purchasing.
Grosshandler solved the problem last year with a technical fix. Shoppers who download iGive’s software now can go directly to retailers’ sites, where a box pops up to remind them part of their purchase goes to charity.
IGive’s commission revenue is growing about 15 percent a month. Ditto, of course, the money flowing to about 8,000 causes, from Carolina Cats Adopt-A-Kitty in South Carolina to the Kentucky Humanities Council.
Next on Grosshandler’s agenda?
Make more money, do more good.