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A Crowdfunding App for the Homeless, HandUp Raises $850,000

posted Jul 17, 2014, 5:19 PM by Siamak Ebarhimi

A startup that’s been called “a Kickstarter for the homeless,” HandUp Pbc, has raised $850,000 in seed funding,  co-founder and Chief Executive Rose Broome told Venture Capital Dispatch.

The funding came from Version One Ventures, Jason Calacanis’ Launch Fund, SV Angel, individual angel investors including Marc Benioff, Eric Ries and Golden Seeds’ Managing Director Kathy Salmanowitz, and the incubators Tumml, 1776 and

Unlike giving cash to needy people on the streets, HandUp helps donors give money to homeless people who commit to using it to fulfill specific needs like rent, security deposits, food or health bills.CrowdFunding advertizing

Homeless advocates, or case managers who work in shelters,on behalf of the homeless, accept donations via HandUp, then ensure the money is spent on what that person said he or she needed.

To generate revenue, HandUp asks donors to pay an optional “support fee” of five dollars each time they make a contribution on the platform. If a donor doesn’t opt-in to pay that fee, the entirety of what they donate goes to the homeless person in need, and HandUp makes no revenue.

The startup will even cover credit card processing fees for donors who don’t opt-in to cover administrative costs, Ms. Broome said.CrowdFunding marketing

Professionals within the shelters and non-profits set up profiles for the homeless on HandUp, initially.

Working with shelters and other advocates for the homeless may sound like a form of gatekeeping. But in reality, Ms. Broome said, most homeless people do not or cannot maintain an online bank account or consistent Internet access. So HandUp’s approach helps them get access to online fundraising when they wouldn’t otherwise have the option.Indiegogo Marketing

It also has the effect of helping non-profits and shelters validate that their clients’ needs are being met fully, and with transparency for donors.

Version One Ventures’ founder Boris Wertz said his firm is backing HandUp because the company has found a way to “make sure money reaches its destination in the most efficient way, while providing accountability and transparency that wasn’t there before in a very fragmented system that meant well, but didn’t work well.”

According to data from the National Alliance to End Homelessness, more than 610,000 people experience homelessness on any given night in the U.S. And at least 380,000 unaccompanied youth under the age of 18 experience homelessness for more than one week every year domestically.Kickstarter Marketing

1776 co-founder and HandUp investor Evan Burfield noted that while HandUp is a public benefit corporation, the company faces a “massive market opportunity.”

About $35 billion in private donations go to human service organizations like homeless shelters and food banks, which doesn’t include giving on the street and within families, he said. All of this can be processed more efficiently through a platform like HandUp and there’s no the reason the company can’t expand to help government programs distribute funding to help the homeless.

With the seed funding, Ms. Broome says HandUp plans to grow its five-employee team, scale beyond San Francisco to help the homeless, and develop partnerships with shelters and non-profits in New York, Washington and other areas with a large or growing homeless population.crowdfunding websites

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By David Khorram