JustGiving

Matchmaking Model






JustGiving

JustGiving operates a matchmaking business model. It provides a global online social marketplace for giving, connecting donors and charitable organisations. The firm's headquarters are located in Bankside, London. The online marketplace provides tools and processing services to pay and receive charitable donations. The company's website allows people to donate to charities registered with the site with a debit or credit card online. It also offers people doing sponsored events the chance to build their own page to collect sponsorship from supporters. JustGiving charges a fee for each transaction.

HISTORY

In 2001, Zarine Kharas and Anne-Marie Huby founded JustGiving. Justgiving is considered as a “Tech for good” company, founded on the principle of: “For profit and for good.” JustGiving achieved profitability in 2006. In June 2011, JustGiving claimed that it had provided its service to more than 9,000 UK registered charities and 1.9 million fundraising pages for users, collecting over £770 million since launch. The cumulative total passed £1 billion in March 2012.

JustGiving operates worldwide, and so far the company has facilitated transactions in 164 countries, worth a total of over $3.3 billion.

In 2014, JustGiving's income was £14 million, from raising around £250 million for charities. JustGiving employs 65 staff, 42 in London, the rest in the US where they opened in 2003.

CUSTOMERS – WHO THEY ARE:

The business model represented by JustGiving connects two groups of customers:

People (consumers) who want to donate with (2) available Charities/causes on the website.

The business model also connects (1) people doing sponsored events with (2) supporters doing sponsorship.

ENGAGEMENT – VALUE CREATION PROPOSITION:

The value proposition is to let fundraisers collect and transfer money to their chosen charities online. In return, the charities receive an efficient, instant service. Also, the numbers that can be reached on the internet via JustGiving tend to be far higher than organisations or individuals could achieve through their own networks alone.

DELIVERY – THE VALUE CHAIN:

The use of the website is pretty straightforward. Charities and donors register for free with an email address and a password. Users then choose between 3 choices: “fundraising for a registered charity” or “raise money for something else” and create a JustGiving croud funding page or “you work for a charity” in which case users will then create their own campaign on Justgiving for causes. JustGiving creates its matchmaking software in-house, and uses Hadoop to manage its services in the cloud.

MONETIZATION – VALUE CAPTURE:

JustGiving charges a 5% fee on each donation. The fee is only taken after the gift is received by JustGiving. JustGiving also charges charities £15 per month for the service + VAT. JustGiving also participates in and facilitates transactions with the UK Government’s Gift Aid – where the UK government donates an extra 25% on top of donations to an eligible charity. Here’s how it works: Let’s say a person donates £10. Justgiving will send the £10 to the charity the same week. Than JustGiving reclaims a Gift Aid from the government (which takes a month), adding £2.50 to the donation. JustGiving charges the 5% fee from the Gift Aid and sends the rest to charity. So for every £10 donated, the charity gets 11.74£ and they get it faster. Currently, over 80% of donations operated through JustGiving are eligible for this scheme.

Sources:

JustGiving website: www.justgiving.com

JustGiving Wikipedia Entry: https://en.wikipedia.org/wiki/Justgiving

Disclaimer:

Written by Nadim-Laurent Berro and edited by James Knuckles under the direction of Prof Charles Baden-Fuller, Cass Business School. This case is designed to illustrate a business model category. It leverages public sources and is written to further management understanding, and it is not meant to suggest individuals made either correct or incorrect decisions. © 2016

Published 20 April 2016



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