How Donatekart is driving need-based donations and making NGOs more effective
Wednesday April 04, 2018,
5 min Read
The crowdfunding platform aims to bridge the demand-supply gap in charity by helping donors know what products the NGOs require. This makes giving more efficient and transparent.
At a glance
Founders: Anil Reddy, Sandeep Sharma
Founded in: 2016
Based out of: Mumbai
Services: Crowdfunding platform connecting NGOs, donors and products
Sector: Social enterprise
Funding raised: Bootstrapped
While volunteering for a Goonj relief camp during the 2015 Chennai floods, it struck Anil Reddy that there was a mismatch between what victims required and what they received from donors. Anil, then an undergrad student at NIT Nagpur, was entrusted with the delivery and distribution of relief packages to the flood victims.
There was no dearth of donors, who’d generously given food, water and clothing. But the victims were in desperate need of things like tarpaulins, mosquito repellents, blankets, bleaching powder, medicines, and so on. Anil realised that NGOs (like Goonj and several others) that organised these relief camps did not get the desired products because donors were largely unaware of the specific needs of an area or a calamity.
The “specific idea” of Donatekart was born right there, says Anil who, along with his batchmate Sandeep Sharma, co-founded the startup in late-2016.
Donatekart started in Nagpur but soon moved to Mumbai, where several large and small NGOs are headquartered. It was incubated by Zone Startups India (part of the Ryerson Futures network, which operates accelerator programmes around the world). Donatekart presently works out of Zone Startups' facility at the Bombay Stock Exchange building.
Anil says, “Nagpur did not have a startup ecosystem like Mumbai which gives a kickstart to a social enterprise like us.”
So, how did Mumbai and Zone Startups come in handy?
Ajay Ramasubramaniam, Director, Zone Startups India tells YourStory:
“The Donatekart team approached Zone Startups for acceleration support at their early stage when they started facing scaling issues... Through our industry connect programme and access to professional services provider, we were able to guide the company in structuring their legal entity, specifically setting up an offshore office that made it easier for them to accept international transactions.”
What Donatekart does
On the Donatekart platform, NGOs can create campaigns for their ongoing projects. They can display the products they are in immediate need of. Donors, meanwhile, can choose the NGO or cause they wish to support and donate the products they want to. Donations can range from Rs 3 to Rs 3 lakh.
Once the orders are placed and payments processed, Donatekart fulfills the delivery (via its vendors) at the end of the campaign. A typical campaign on the platform lasts for 30 to 45 days. Donatekart has tied up with several offline vendors to fulfill product deliveries. Partnerships with online retailers like Amazon, Flipkart, BigBasket might also be on the anvil.
Donors are able to track their donations and product utilisation in a transparent manner. They get regular updates about campaigns they are supporting. NGOs, on the other hand, are provided tools to manage their donors smoothly, and improve retention.
“Our vision is to help people donate better and make NGOs more efficient. There are over two million NGOs in India, and many of them lack transparency. Lot of donations do not reach the desired location, and donors are often reluctant to give. We are trying to improve that.”
Impact so far
Donatekart has hosted nearly 350 campaigns on its platform. Over 200 NGOs are using it, with 8,000-plus donors having supported causes. It has distributed Rs 1.5 crore worth of products in a little more than a year across major Indian cities, and even difficult areas like tribal Maharashtra, Jammu and Kashmir, and the northeast.
“Most of the work has been in the area of education, children, animal welfare, old age homes, and disaster relief. The average donation size is Rs 2,500, which is higher than the industry average. There are 2,000-plus options to choose from.”
Interestingly, 35 percent of donors on Donatekart are from the US, UK and 30 other international locations. That perhaps explains the impressive ticket size. The startup, without revealing exact numbers, says it is growing 20 percent month-on-month. It is also recording about 17 percent repeat donors.
In February, Donatekart won the NASSCOM Social Innovation Forum Award in the financial inclusion category. Prior to that, in March 2017, it secured the second spot out of 100 in the prestigious Azim Premji Social Enterprise Challenge held in Bengaluru.
Donatekart does not charge NGOs who are allowed to list their campaigns for free. It takes a 10 to 15 percent cut of vendor revenues. This model has allowed the startup to pay the salaries of the six people it employs.
“We’re helping create a market for our offline vendors. It includes large manufacturers to small suppliers. We also make their products available at a lesser price for donors who usually have to pay more if they buy it on other platforms.”
Because Donatekart does bulk orders, vendors are content to give a bit of a cost relief to customers (donors). “Last month we did Rs 20 lakh in orders. We’ll take that up,” Anil adds.
Bootstrapped so far, Donatekart is eyeing seed funding in the next three to four months. The goal is to increase its reach among NGOs and ramp up the vendor network across more locations. The startup aims to raise over Rs 100 crore worth of donations over the next three years.
Anil says, “We are in the crowdfunding market with a clear differentiation. We hope to make a difference by facilitating need-based donations.”