 Hello and welcome another episode of the nonprofit show. Today we are already fired up for our conversation that we're about to have with Jake Wood. Jake is a CEO and founder at grounds well and he joins us thanks to our sponsor staffing boutique Katie Warnick with the referral and introduction he's here to talk to us about the intersection of dafts and corporate philanthropy so I'm excited to have this juicy advice conversation. But before we jump into it we want to remind you our viewers and our listeners who you are looking at or possibly listening to. So hello to Julia Patrick CEO of the American nonprofit Academy. And I'm Jared ransom Julia's personal nonprofit nerd but I can be yours to CEO of the Raven group and really honored to serve alongside Julia for these conversations. I'm going to be here at 721 episodes I looked at the spreadsheet before went live. If it weren't for amazing sponsors so again a huge shout out to our friends over at Bloomerang American nonprofit Academy, your part time controller be generous fundraising Academy and National University. Another shout out for Katie and staffing boutique the nonprofit thought leader as well as nonprofit nerd so these companies keep us going and growing, moving along with our episodes here at the nonprofit show and if you missed any of them. By now you probably know where to find them but it's on all of the fantastic streaming platforms which include Roku YouTube Fire TV Vimeo and podcast so go ahead and queue us up wherever you stream your entertainment and this conversation with Jake would will be on these platforms and just a few couple of hours but until then we're going to go live and our live and having this amazing conversation. So Jake would CEO founder groundswell. Welcome. Hey, thank you for having me. Looking forward to the conversation. You know, you have such a fascinating history, Jake that has led you to this platform. Talk to us about your journey to groundswell. Yeah, you know it's it was not a natural path to becoming a fintech entrepreneur. I started out in the Marine Corps served overseas Iraq and Afghanistan Marine Corps infantry. I accidentally started a nonprofit organization in 2010 called team for the con, you know, really in auspicious beginnings, but it scaled really dramatically and continues to thrive today it's an organization that responds to disasters and humanitarian crises, primarily using military veterans got about 150,000 volunteers around the world, responding to complex disaster and humanitarian scenarios. And so I know a thing or two about the nonprofit journey and the struggles and the opportunities in the space. And that's really what led me to start groundswell I came to the conclusion after 12 years at Team Rubicon that it was time to be an entrepreneur again. I wanted to do something to take the lessons that I learned running a nonprofit and find a way to create impact outside of kind of the narrow space that Team Rubicon operated and came up with this idea for democratizing philanthropy, which I'm sure we'll get into to what that means to us but ultimately our idea was, you know, we think everyone should be able to give like gates, get recognized like Rockefeller and get tax like Buffett and, you know, that's the I love it. I think this is super cool because I think and Jared, we've talked a lot about this. When you work with somebody who's been on the other side of that desk and had to navigate leadership and performance of a nonprofit, and then move into the for profit side. That is magical. And too many too many organizations have never served on that other side of the desk. That's right. I'll tell you one thing I heard from one of actually my investors in groundswell when my early investors she also she runs a her name's Heather Harden human ventures. And she also came from the nonprofit space and she said, you know, joke to me early in the process she goes, Jake you're going to realize that running a nonprofit was like training with ankle weights on. Oh yeah. And the moment you take those ankle weights off you're going to realize just how fast you can run. Yeah, I love that. I and I, I have to agree with that. That is a great analogy. It really, it really is. So let's get into it then. I mean with groundswell's work, give us some background and some kind of context to what the DAF, you know, ecosystem in relationship to corporate philanthropy. Because right now, we're seeing a lot of corporate work pulling back scaling back. And so, you know, we're at even a more interesting time, I think. Yeah, well, you know, so you continue to reference DAF staffs for those kind of curious it stands for donor advised fund, you know, some people are probably familiar with that. What's interesting is that donor advised funds have kind of been the purview of the high net worth class for for decades, you know, if you had a lot of money. Not quite enough to justify having your own personal foundation, you had a wealth advisor that probably created a donor advised fund for you as part of your tax planning strategy and to help to make your philanthropy more efficient. And then average people like us, you know, Julia, you, Jared, myself, we didn't have access to these. And I saw a lot of people giving to team group account through donor advised funds I quickly understood just how effective and efficient they could be. And I always scratched my head at why other people didn't have access to them. Now donor advised funds have gotten a little bit of a bad rap over the last couple of years because there are some I guess you can call them loopholes right they don't have minimum distribution requirements like personal foundations do and and frankly like I'm highly supportive of legislation to close those loopholes and make minimum minimum mandatory distribution requirements and frankly I think it should be higher than 5% intend to build our product to support that. But what we knew was that a lot of companies think they're really good at giving away money. They're not. And I saw that as well and I raised a lot of money from from corporations you know I raised $350 million worth while I was running team Rubicon a lot of it from corporate America. And you know what I realized was a lot of those decisions were very centrally driven. I was able to convince a CEO to give us that money and you know that decision while it really benefited team Rubicon was not really reflective of, you know the broader employee base in all instances and so that was kind of one motivation the second thing was in an era of you know increasing inequality why is it that only the executives of these companies have access to efficient you know philanthropy tools. So, you know to cut to the chase what team, I'm sorry, what hard to break old habits, what Brown swell has done is we've built a platform, the world's most modern and inclusive corporate giving platform that provides each employee at a company with their own donor fund and then allows companies to either directly gift or match funds into those deaths. And so we've provided this this modern giving tool for employees that they can centralize all their personal philanthropy through. We've made corporate matching programs, nearly administration free. You introduced privacy into that process because now employees get that money in their DAF, without having to disclose to their employer where they're going to give it. And that's really important in a hyper polarized world where your philanthropy might be deeply personal. And you may not feel like you can actually get involved in your company's matching program if you have to tell them where you're giving. A lot of organizations do have that disclosure aspect or an approved matching gift list. And so I love this component. This must be when you look at the landscape of your competitors and you're not you don't have any like direct competitors per se but but the concept of this, this has to be one of the more unique functions of what your what groundswell is doing right. Yeah, absolutely there are some companies out there that have been around Benevity, you know is a kind of a well known name Fortune 500, you know player. But they've really only automated a process, they've made it easier to automate getting the match and frankly they're not even really good at automating it. What we've done is we've made philanthropy and employee benefit, right. The donor advice when we give you is like a 401k or HSA for charity is your personal giving account and you can take it with you if you leave your company. And so really just reimagining how philanthropy plays into a total compensation approach. When you think about you know you talked about a drawback in corporate social responsibility. And maybe that's inevitable if this recession hits and you know smart minds are in disagreement about that. But you know I think one of the things we're seeing is that the war for talent is as fierce as ever. And so if you take your philanthropy benefit or I'm sorry your philanthropy budget that you already have and kind of like subtly repurpose it as a real retention strategy. That's just a smart business tactic. I love that. I love that concept. And I haven't heard anyone talk about a direct link to their labor, you know, protecting their labor force in terms of philanthropy like that that's super cool. Well, I want to poke the bear a little bit because I know top of philanthropy today and many other news, you know, media right now they're really talking they we we even talked about it as soon as we jumped on today's conversation is about. Let's just call it out right Amazon smile ending. What have you seen for this space Jake I'm curious because I'm poking like I want to hear it. My my response to Amazon smile going kaput is you know if a tree falls in the woods and nobody's around to hear it doesn't even make a sound I mean Amazon smile was frankly a little gimmicky. You know in the history of Team Rubicon, you know $300 million $350 million raised we probably got $50,000 from Amazon smile. And I don't think we're alone. I mean, listen, it's free money like we didn't have to do any work on it, but it's pretty immaterial I would imagine to almost every nonprofit out there. And frankly, I mean, if Amazon's looking for places to cut costs I can't imagine that this was a real cost center for them. So, you know, while it while I think it's immaterial to the nonprofit space I also am left scratching my head is to say like, Why do you think that this was the right move for you to keep your shareholder value high just didn't make sense to me. Yeah, it makes me want to go like to definitely shop somewhere else not on that platform but I am curious. So many people will be bombed of the discontinuation of Amazon smile are you seeing that grounds well will be a great alternative and will pick up these opportunities of individuals saying hey, I want to daft and I want to like be able to advise where these dollars go are you seeing that coming to fruition now. I don't know that the closure of Amazon smile directly impacts our business I think you know I think what what does impact our business is that people are looking to give like gates right like I you know I kind of said that at the beginning I think people are quickly understanding that that high net worth individuals they they they use different strategies and tactics for everything that they do. You know some of the advantages of a donor advised fund is that you don't have to just donate cash like that's how normal people donate rich people don't donate with cash they donate with appreciated assets. So advised funds make it really easy for you to do things like, you know, contribute appreciated stock. Take the full market value of that appreciated asset, as a deduction for your taxes but not pay capital gains taxes on it. So going back to Amazon, like that stock, you know, over the last six months has gotten beaten up but if you if you bought stock in Amazon five years ago you've you've 10x the price. If you want to donate $1,000 to charity. Don't go swipe your credit card online and send $1,000 transfer for shares of Amazon into your groundswell account. And you're not paying any taxes on I mean it's just getting like that's how rich people give. Yeah, we want everybody to be able to give like that. Sorry, Julie you talk about the digital tools and this is really empowering now these individuals all individuals as you said like the average Joe the three of us you know. And then so how is this empire empowering really these donors to have this this ability. Yeah, well you know we just one of the other things that we observed with existing competitors out there like Benevity is that you know it's a web based platform, and you know we believe that you know one today's generation, you know they are whether good for better or worse they're slave to their to their phone and, and they do their banking on their phone they do they do everything on their phone. And so if you're not a mobile first platform, you're, you're losing out right. So we've we've launched as the only mobile first employee giving solution out there, and we've built a beautiful mobile app that looks and feels like like Venmo or Robin Hood for giving. But you know it unlocks even more because the truth is people are inspired to give in moments right they're inspired to give when they pass a homeless person on the street or they turn on CNN over their morning coffee and they see the war in Ukraine. And it not when they're sitting at their desk logged in through single sign on working in you know an Excel spreadsheet like that's not when people are inspired to give so why are you requiring them to give in that way through their corporate platform. Talk to me about the size of an organization that would be an appropriate fit for groundswell I mean, is this the sort of thing that smaller businesses can get engaged with or individuals or right now are you kind of seated more with that larger larger organization. Well it's interesting because you know the existing platforms out there I keep talking about and you know this isn't to poke them like they've done a great job they've pioneered the space. Let's be honest like they can only serve an enterprise customer. You know that's they can't play in the mid market or SMB space so we saw that as an opportunity. You know we want, you know a small tech startup to be able to give like Google. We want a small law firm to be able to give like, you know, Paul Weiss. And so, you know we have some enterprise customers we just took a great accounting and tax advisory firm called Wipfleet live 3000 employees. But you know we've got customers that are 30 employees. Okay, cool is the tech is built to be nimble enough to support that. I love it. Kind of ask you this question do you ever see a time when maybe you have nonprofits and some of the larger nonprofit organizations. I'm engaging this. It's interesting that you asked that so we have, I think, two opportunities within the nonprofit space so one, you know there's plenty of nonprofits out there that are one large enough and fiercely competing to retain their talent and also because they have a fee for service model they can more easily justify taking some of their revenue and giving it to their employees to give to different charities. I think hospital systems museums, things like that. But absolutely we, we intend to build a full suite of functionality for nonprofits within the next 18 to 24 months. We want this to become a marketplace. Now we have to earn the right to build that and by that I mean, you know, we could build all the great these great tools in the world for nonprofits but they don't they don't have enough incentive to come on to groundswell yet we're not moving enough money we have to be moving, you know, north of $100 million a year in order for them to say oh I want a piece of that pie so I'm going to go create an account with groundswell and try to attract the donations flowing through this platform. But ultimately when we do build that what we'll create is is the most cost effective donor acquisition marketplace on the planet. Think about what we'll have we'll have donors that have capital set aside to give. We'll have data on exactly the types of things that they're interested in and we can help connect donors to nonprofits, more efficiently, so that we can move that capital better. I ran a nonprofit I know how hard it is and expensive it is to find donors. Yeah, I want to solve for that. I love it. I love it. Talk to us about how long you've been engaged in this. Is this the sort of thing that you know you with your amazing backstory which is truly remarkable moving through to being becoming a tech entrepreneur and creating this intersection. What is that time span? What does that look like? Well, it looks like hiring a lot of people smarter than me. So Team Groupicon, you know how to reputation for a few things one of the things that had developed a reputation for was its ability to lean into technology to execute its mission. So we were a very tech forward organization did some really incredible things in partnership with companies like Microsoft. And it's not like I wrote was writing the code I didn't I still don't know how to write code, but I understood how some of those elements worked. So we were fortunate enough to go out and raise pre substantial amount of venture capital money gave me the opportunity to go out and hire some really smart product leaders and engineers. What I brought to the table was, you know, my understanding of how to build and scale teams but also just my understanding of how companies give away money how people think about philanthropy at an individual level to to really inform that that product roadmap and strategy so it's been an interesting journey. The product just came out and came out of beta back in June so we haven't been out that long but really excited about the growth that we're seeing and the companies that are going live and democratizing their corporate philanthropy. I have a question from one of our viewers Jake and I'd love to pose it to you, really to help better understand, you know, regular donations are tax deductible. So what is the advantage of giving in stocks if you can help us understand why there might be a the difference and how that benefits us. Yeah, absolutely so I'll start by saying I'm not a tax advisor you should seek tax advice from a professional. Yeah. So, you know, not all assets are the same so your, you know, if you have $1,000 sitting in your bank account, and you have $1,000 of stock, which one is it better in that stock maybe had a cost basis of $500 so it's a it's it's more than value. You will always want to give that stock instead of that cash now that the write off is the same but the difference is when you give that cash, you then have to later sell the stock to pay for other expenses right and when you sell that stock, you're going to pay 20% capital gains on that $500 of appreciation that that stock had achieved. But if you donate that stock instead you still take the $1,000 right off, but you don't have to pay the capital gains tax because the nonprofit in this case the donor advised fund receives that stock, it liquidates it. And because it's a nonprofit it doesn't have a tax obligation. So, you basically evaporate the capital gains tax in that and that's, you know, that's not a, you know, that's not a loophole that's not a, you know, this this is this is a part of the tax. It's the function, it's the function of it. Yeah, yeah, absolutely. You know, one of these things that this conversation has gone by so quickly and and one of the things that we really want to get you to share with us is your your concept of and it's not your concept but I think it's one of the foundational principles maybe the trust based philanthropy trend and how you are pulling this into your ecosystem and and moving this forward if you could talk about that a little bit and share with us how you came to this. Yeah, we were you know we've been talking about trust based philanthropy at Team Rubicon for a decade and you know we we in the nature of our work responding to disasters around the globe so much uncertainty and instability and that type of environment donor restrictions were not just so generous from a bookkeeping perspective but but really restricted our ability to plan and be nimble in the face of like, we don't know where we're going to have to respond next. And so very early on, we, we were trying to convince our donors to trust us. We don't know what what this year is going to hold and maybe it's got major hurricanes maybe it's only an international earthquake maybe it's a civil war in Ukraine. We're investing this these dollars to disaster response in Kansas, Kansas doesn't have a flutter tornado this year, like that's just sitting on our books and doesn't unlock any impact, you know in the community and so we really relied on effective storytelling, effective reporting analytics, and it really encouraged people to just begin unlocking those dollars in trust us. And in, you know, I'd say six or seven years ago we started to see that tide turn where a lot of our major donors moved from these highly restricted annual grants to the same sized annual grants with zero restrictions. And that's really when you saw the organization, like hockey stick, like they talk about in startup organizations because we had the flexibility to take advantage of opportunities without having to delay 3060 90 days to go find new restricted funding for it or go back and beg existing funders to release restrictions and speed is of the essence. Now you've started to see this become a trend in one that we welcome, you know, Mackenzie Scott is, you know, the queen of this, you know, unlocking. So what's the number at now how many, however many tens of billions of dollars she's given away. And, you know, thankfully, Team Rubicon was a recipient of one of her very very generous grants, entirely unrestricted. So it's, you know, it's just a remarkable trend in the space I think it's the the era of restrictions I think was highly paternalistic. And, and frankly, I actually yelled at a room full of venture capitalists. When I was starting groundswell. I was on a panel, somebody asked me the question in it, you know, it related to how having been a nonprofit CEO did or did not prepare me to be for profit CEO. And I think that's how it was teed up but I looked at this room full of VCs and I said, all of you are more than willing to cut a $20 million check to an 18 year old that's never built anything and his or her entire life. Sight unseen for an idea, but you want to write a $20,000 check to a nonprofit entrepreneur who's been slugging it out for two decades in this mission and tell her how to spend it. And I don't think they'd ever been spoken to that way. But they got it, they got it and they kind of chuckled, they kind of digest and they chuckle and they're like, you're right, that's like, we don't invest that way so why would we donate that way. I think I think this is a trend that's a long time coming. In fact, it makes me think of your ankle weight analogy that you had shared earlier with us and I do hope that it's here to stay I know a lot of donors and funders really said, you know, hey do what what you need to with our money that we gave you pre pandemic. Now, you know, it, everything is hit the fan we don't know which way is up right now so you have our money use it for whatever you need and I like you Jake I hope it's here to stay because, you know, I'm still filling out grant applications that are for like, what is someone salary and defend that why are they getting paid that and I'm like are you kidding me this is still happening today. And these hoops that the funders asked nonprofits to go through are so asinine sometimes and it's like, it's this obstacle course that God if you can even make it to the end like you've done, you just did the American Ninja Warrior course. You know, I do hope that it's here to stay and I would love love love to have more conversations about this trust based philanthropy philosophy, that's a mouthful, and, and to hear more about it. So, thank you for waving that flag too. The big part of it is education, you know, educating the donor, and the corporate partners to saying, actually, this is a better way to invest your money. Then, you know, if you if you come to, you know, the table and saying we're only going to put X number of dollars a certain way in our business that's not a good way to run a business. We need to understand, you know, that that nonprofit piece of it. Well, this has been really an exciting opportunity for us, Jake, to have you on the nonprofit show to really see the beginning of the story journey that you've been on. Obviously, your work and your leadership with Team Rubicon has informed so many other nonprofits and so many donors, frankly. So, to see you navigating this concept, we're going to really be excited to see how you grow and how it moves forward. And I'm telling you, I really love the idea of engaging nonprofits with teams and having this become part of their ecosystem for to, you know, retain and protect their labor. I love this concept. Awesome. Well, thanks for having me on. It was a quick 30 minutes. I hope I didn't say anything that keeps me from getting invited back. It goes fast. In fact, we had one of our viewers right in and say in quotes, that's not the way you invest. So why would it be the way you donate I'm going to be quoting that so you definitely landed for a lot of our viewers and our listeners today live and I'm going to be able to tell you a little bit more about what's going on in the field, even more so in the recording. So Katie Warnock knew what she was doing when she said, Hey, you got to talk to Jake make sure you get Jake on so thank you. Of course, thanks Katie for making the recommendation. Yeah, it's been great. Hey, check out. ground swell.io and learn about not only his product in the service, but the philanthropy and the philosophical side behind it. I think it's a great way to engage more sustainable relationships with those individuals. And it's, I feel like Jake, this is, you're writing a tide of change that is so needed and so exciting in the nonprofit sector. And so, you know, we like to remind everybody that approximately 15 million Americans go to work every Monday to a nonprofit. And hopefully Tuesday and Wednesday and Thursday and Friday. Yeah, this is true. This is true. But you know, that's a hell of a lot of people. That's a hell of what your guns and more than 5% of our GDP is invested, you know, or is circles the nonprofit sector and so this is a super cool thing to be talking to you about and definitely we'll want to have you come back. Again, I'm Julia Patrick, CEO of the American Nonprofit Academy, been joined today by the nonprofit nerd, Jared R. Ransom. She's actually my nonprofit nerd first, but like she said, we can share. There's plenty. Yeah, plenty to go around. Hey, we want to thank all of our prevent presenting sponsors from Blumerang American Nonprofit Academy, your part time controller, be generous fundraising Academy at National University, staffing boutique, nonprofit thought leader and the nonprofit nerd. These are the folks that allow us to have these amazing conversations like we've had with Jake Wood and groundswell each and every day. So Jake, I'm really looking forward to what's going on with you. And to see this business of yours grow and flourish and help our sector. I appreciate that. Thanks for having me on. Wish us luck. I got a lot of work out of us. Anyway, hey everybody, have a great day. We'll see you back here tomorrow. Thanks.