Speaker 1: You're listening to Bloomberg Business Week with Carol mess Here
Speaker 1: and Tim Stenebek on Bloomberg Radio.
Speaker 2: So when I was a kid, Carol, Yes, and I
Speaker 2: needed to raise money for you know something at school.
Speaker 2: We did walk a thon's for charity. We did school trips.
Speaker 2: I did it the old fashioned way. Okay, this was
Speaker 2: the nineties. Keep that in mind.
Speaker 1: Okay, yep.
Speaker 2: I went door to door with a clipboard. I ranked doorbells.
Speaker 2: Actually wore rollerblades so I could do it.
Speaker 1: Quicker, so I could go to the nineteen nineties.
Speaker 2: So southern California, nineteen nineties. I should have skateboarded. Actually, well,
Speaker 2: it was, of course before smartphones. Kids these days have
Speaker 2: other options, such as the one developed by our next guest,
Speaker 2: Cole Morgan, the founder and CEO of snap Mobile. It's
Speaker 2: a digital fundraising tool that high schoolers can use to
Speaker 2: raise money for schools, teams, clubs, and more. Colds here
Speaker 2: with us in the Bloomberg Interactive Brokers studio. Cole, good
Speaker 2: to have you with us this afternoon. I should note
Speaker 2: you raised seven hundred million dollars for one hundred thousand
Speaker 2: plus groups and teams a lot.
Speaker 1: It's a lot of money.
Speaker 2: Yeah, we're talking about some serious money here. Talk to
Speaker 2: us a little bit about the platform. And also I'm
Speaker 2: interested in the business model here and they take great.
Speaker 3: Yeah, so we h. So I would just say thank
Speaker 3: you for having me wuck. When I called my mom
Speaker 3: and told her the idea for the business, I told
Speaker 3: her we were going to raise a million dollars for schools.
Speaker 1: How old were you?
Speaker 3: I was twenty eight at the time, thirty eight now
Speaker 3: and now and I we're actually approaching about eight hundred
Speaker 3: million dollars giving back to school so far.
Speaker 2: Wow.
Speaker 3: So yeah. So we've we started a few years, started
Speaker 3: ten years ago. We're in about half the schools in
Speaker 3: the United States. We focus on financial transparency in schools
Speaker 3: and helping groups of people raise money for a common cause.
Speaker 3: Where a lot of the crowdfunding platforms online focus on
Speaker 3: individuals raising money come in quickly sign up. We help
Speaker 3: groups of people with that require oversight. So the school,
Speaker 3: you're a club organization, you know, where somebody actually needs
Speaker 3: to oversee the final antles of the of the group.
Speaker 3: We helped that group raise money and so the money
Speaker 3: goes directly to the organization or to the school, or
Speaker 3: to the nonprofit or whatever it is, rather than the individual.
Speaker 1: So how does it work?
Speaker 3: Kids log in, they send send out emails, text message,
Speaker 3: social media. January first, we're launching mobile apps. We'll have
Speaker 3: over a million kids download our mobile app next year.
Speaker 2: So there's no mobile app up to now.
Speaker 3: No, it's all been a web app. Wow, because of
Speaker 3: web apps. Really a web app was faster. But we
Speaker 3: had we actually had a mobile app and we very
Speaker 3: first started. But it would show up. You'd try to
Speaker 3: get all these kids to download a mobile app. It
Speaker 3: would take too long. But that was ten years ago,
Speaker 3: and kids weren't.
Speaker 2: They kept thinking they were down Snapchat.
Speaker 3: That had happened. That's happened. Yes, yeah, so they so
Speaker 3: they now they log in, they download the mobile app,
Speaker 3: and they go through the flow. You know, they send
Speaker 3: out their emails to friends and family. I'm sure you
Speaker 3: guys have actually probably gotten an email from a niece
Speaker 3: or nephew to donate to a a Finity program.
Speaker 2: No, no, So it'll take you to a site that
Speaker 2: shows you that it is Snap Mobile.
Speaker 3: It's yeah, we'll show you that so that that part
Speaker 3: of the platform is called Snap Raise, and it'll take
Speaker 3: you to that. It'll actually take you to that kid's
Speaker 3: fundraising page, because what we know is that people want
Speaker 3: to support kids and the causes that the kids care about.
Speaker 3: So it's not about supporting the actual football team directly,
Speaker 3: it's about supporting the kid who's a part of the
Speaker 3: football team. So it actually will take you to when
Speaker 3: my son starts using the platform, he's only two, it'll
Speaker 3: take you to Luke Preston Morgan's you know football page,
Speaker 3: and you'll Luke will have a goal, and then the
Speaker 3: team will have a goal above that. So it's a
Speaker 3: hierarchical structure that allows the team to raise money. So
Speaker 3: all one hundred kids on the football team are raising
Speaker 3: money at the same time for the same cost.
Speaker 2: You do live in Texas. You're already thinking about football
Speaker 2: and your kids only two.
Speaker 3: Yeah, yeah, well I played football. We live in Texas.
Speaker 3: This is the whole company is surrounded by it.
Speaker 1: It seems so logical. So what was it that what
Speaker 1: was the idea initially that you said, Okay, we've got
Speaker 1: something here.
Speaker 3: Yes, it's very simple ideas. It looks more simple on
Speaker 3: the surface than it actually is underneath. So we have
Speaker 3: an entire organizational database that connects school administration all the
Speaker 3: way to the communities in which they live and that
Speaker 3: support them. So there's a lot of data and infrastructure,
Speaker 3: financial transparency, oversight, security compliance. But on the surface, it
Speaker 3: was really simple. I was selling discount cards and cookie
Speaker 3: dough in schools after I got done playing football, and
Speaker 3: a coach said to me, we love that you're here,
Speaker 3: but we hate why you're here. So there's got to
Speaker 3: be a better way. This is the honest to goodness story.
Speaker 3: It's on our website. I said, what do you mean,
Speaker 3: He said, our kids. You know we need help. We
Speaker 3: need to raise money, but we don't want to do
Speaker 3: the things that you're making us do, which is sell
Speaker 3: these things. The school doesn't like that we take cash.
Speaker 3: The kids don't want to sell things, the parents don't
Speaker 3: want to buy things. They just want to support. So
Speaker 3: I said, okay, just like my whole life, have taken coaching.
Speaker 3: It's like what do I do? So I looked around
Speaker 3: the school and I saw every kid on their phone,
Speaker 3: and I started asking friends and family and people at
Speaker 3: bars and restaurants. I said, do you care about supporting kids?
Speaker 3: And they would say yes, And then I would say,
Speaker 3: do you have cash in your wallet? And they would
Speaker 3: say no, and I would say do you have your phone?
Speaker 3: And they would say yes. And I would say you
Speaker 3: have your credit card and they would say yes. And
Speaker 3: so I just put together the idea of the phone,
Speaker 3: the credit card, and kids asking politely for community and
Speaker 3: family support.
Speaker 2: So what's your take rate?
Speaker 3: Our take rate is twenty percent?
Speaker 2: Wow, Yeah, that's very high. That's much higher than I
Speaker 2: thought it would be. So of every dollar that is donated, Yeah,
Speaker 2: your platform takes twenty percent. Yeah, I was expecting two
Speaker 2: or three percent.
Speaker 3: Yeah, it's a it's a high take rate for what
Speaker 3: we'd for, you know, what you think of in the
Speaker 3: world of crowdfunding. But if you look at, you know,
Speaker 3: some of the other individual platforms, they just tacking on
Speaker 3: in a different way. We don't do that. There's a
Speaker 3: service based model for us. So we help organize, coordinate, promote, maintain,
Speaker 3: and manage the entire online fundraising event. So we're not
Speaker 3: the cheapest thing in fundraising, but we are the cheapest
Speaker 3: thing in school based fundraising, which is a very different
Speaker 3: thing because when you sell discount cards and cookies, you're
Speaker 3: only making fifty percent.
Speaker 2: That's one hundred and sixty million. I was just doing
Speaker 2: some calculations here, one hundred and sixty million dollars.
Speaker 1: But that's a big difference because you think about yeah,
Speaker 1: you know, whether it's girls scout cookies or what have
Speaker 1: you. You're saying that the kids only get fifty percent, Yeah,
Speaker 1: sometimes less, sometimes less?
Speaker 2: Yeah, are you because there's a product involved?
Speaker 3: Sometimes yeah, But you can hide behind the you can
Speaker 3: hide behind the fact that the product is there.
Speaker 1: But I'll be honest with you, having done that for
Speaker 1: nieces and nephews and buying wrapping paper and stuff that
Speaker 1: I really don't want, I'd rather have just given them money.
Speaker 1: But that's not the way it was set up. Are
Speaker 1: you going to only stay with schools?
Speaker 3: I don't mean only, but no, we were were I
Speaker 3: mean we are the largest, you know, youth organization fundraising
Speaker 3: platform as well. Yeah, it's just our main focus is schools,
Speaker 3: but we grow into the We grow into the youth
Speaker 3: side as well. One of the other things that we
Speaker 3: provide for the twenty percent take rate is financial oversight
Speaker 3: and compliance for every dollar that comes into your school.
Speaker 3: So there's a school actually locally that an athletic secretary
Speaker 3: absconded with some of the money and because they were
Speaker 3: a Snap client. This just happened a few weeks ago.
Speaker 3: Because they were a Snap client, they were actually going
Speaker 3: and have a full audit trail of every one of
Speaker 3: the donations and the dollars that came in, and they
Speaker 3: were able to, you know, help find out that what
Speaker 3: that athletic secretary had done, what happened?
Speaker 2: Are you profitable?
Speaker 3: We are not.
Speaker 2: Where are you spending all the money you've raised eight
Speaker 2: hundred million. I've eight hundred million dollars has gone to schools,
Speaker 2: which means one hundred and sixty million dollars has come
Speaker 2: to you. Guys, if we're getting you in twenty percent,
Speaker 2: where's the money.
Speaker 3: Going investment into the technology. We've acquired a couple companies
Speaker 3: as well. We've acquired three businesses, so are We've also
Speaker 3: raised capital as well.
Speaker 2: Ninety million dollars in a series B led by the
Speaker 2: investment group that owns the La Dodgers. Yes, Algrige twenty
Speaker 2: twenty one.
Speaker 3: Yep, yeah, yeah. So we've we've hired, we invest in
Speaker 3: hiring outside salespeople. So our salesforce we have one hundred
Speaker 3: and fifty boots on the ground that actually serve the
Speaker 3: communities in which they live.
Speaker 1: So is that your highest overhead or is it that
Speaker 1: in technology?
Speaker 3: It's that in technologies. We've also scaled up our technology
Speaker 3: team as well.
Speaker 1: Thirty seconds left. Here's the what's the endgame? Is it
Speaker 1: to go public?
Speaker 3: The endgame is to build the transformative platform that supports
Speaker 3: teachers and students. It's teachers and athletic directors and coaches
Speaker 3: the way that they support their kids. You know football
Speaker 3: background with me, so I focus on the process. If
Speaker 3: we build a great company that serves the needs of
Speaker 3: all of our customers, then who knows what happens.
Speaker 1: But you say you're going to stay within like helping
Speaker 1: for the US part schools or kenn it expands.
Speaker 3: Schools, youth organizations, colleges. Yep, yeah, it can grow quite
Speaker 3: a bit.
Speaker 1: There's a little bit of a growth runway there.
Speaker 3: It's a big market for us.
Speaker 2: And imagine a mode too with getting the schools signed on.
Speaker 2: That's a hard party.
Speaker 3: It's incredibly hard, and it's one of the reasons you
Speaker 3: have to invest the way that we're investing.
Speaker 1: Come back and let us know how things are going.
Speaker 1: I promise really interesting. Cole Morgan, founder and ceof Snapmobile,
Speaker 1: joining us here in our Bloomberg Interactor Broker Studio. Good
Speaker 1: Luck'll talk to you soon again.
Speaker 3: Thank you.