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Report on Business ‘Aha’ moment in pitch to Nike took Calgary charitable-giving firm from startup to success

The series: We look at decision makers among Canada’s mid-sized companies who took successful action in a competitive global digital economy.

Everyone is happy to take a meeting when your business model is built around making the world a better place. But whether they actually buy your product – well, that’s a bit more complicated.

It was a lesson that Bryan de Lottinville learned first-hand when he founded Calgary-based Benevity Inc. in 2008. The organization produces software that makes it easy for the staff of client companies to donate time or money to charity.

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Bryan de Lottinville, CEO of Benevity, in the software firm’s Calgary office.

Chris Bolin/The Globe and Mail

But that business model wasn’t always so clear cut. “Not everyone saw a business in what we were doing,” the CEO says of the company’s earlier plans.

At its founding, Mr. de Lottinville and his team envisioned Benevity as an API-driven (application program interface) brand, one that would partner with organizations that would then embed its technology into their own platforms, say, an online banking app or an e-commerce shopping cart.

The tool would allow a bank’s customers to make charitable donations when managing their finances, for example, or enable a retail consumer to give to their favourite charity when making a purchase.

“We had lots of great meetings on that, but with a glacial sales cycle,” Mr. de Lottinville recalls. “If we hadn’t built a cloud-based car for the engine in the area of employee giving and volunteering, which was one of our targeted areas, we’d be long since dead.”

Some of Benevity’s staff at its downtown Calgary office.

Chris Bolin/The Globe and Mail

Benevity’s digital turning point came when it developed the Spark platform. While its API solution had gained some traction, Spark automated the charitable donation process further by making it easier for employees to donate time or money to their charities of choice, added a software-as-a-service (SaaS) element to the product and put an employee-friendly spin on giving that large organizations could leverage to their advantage in the ongoing pursuit to attract and retain top talent.

Spark’s “giving-back” platform helps organizations boost employee engagement and improve staff retention – particularly among millennials. Companies can promote causes that align with their corporate responsibility strategies and match employees’ donations.

At that point, Benevity had been focused on smaller clients, but it wasn’t until they did a technological 360 – and pitched an athletic wear giant in 2011 – that the team had its eureka moment.

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“We thought we’d go after the mid-market assuming that larger companies were already well served, but it wasn’t until we participated in an RFP [a request for a proposal] with Nike and demonstrated the application and they said, ‘Wow,’ that we realized how low the bar was in the space. We realized the opportunity was with enterprise clients.”

The move paid off.

Benevity counts 450 enterprise clients – including iconic brands such as Apple, Google, Microsoft, Hewlett Packard Enterprise, Visa and the Royal Bank of Canada – representing an employee population of about 10-million eligible users. The company now employs more than 420 people across five offices in Canada, the United States and Britain (up from about 90 staff in 2015).

Benevity averages annual compound growth of around 40 per cent, according to the CEO.

The company’s renewed success coincided with a sea change in employers’ perception of corporate social responsibility programs, according to Jarvis Strong, a client development manager with Think Canada, a fundraising consultancy based in Calgary.

Mr. Strong notes that in the past decade, workplace charitable programs have shifted from a focus on supporting a single large charity, such as the United Way, to donating to a wider array of non-profits and service-oriented charitable organizations.

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“Private companies are becoming more aware of building philanthropy and community give-backs into their workplace,” he says. “Many businesses are taking the reins with their corporate social responsibility policies by building [charitable support] into their brand’s culture,” he says.

“Platforms such as Benevity have opened the doors to more flexible forms of workplace giving.”

Benevity aims to change the narrative on charitable giving. “A millennial who has grown up in that democratized, empowered online environment wants accountability, choice, user-centricity, interactivity and a bunch of things that the status quo wasn’t delivering to them,” Mr. de Lottinville explains.

Chris Bolin/The Globe and Mail

As Mr. de Lottinville notes, Benevity did have competition in the market after embarking on its SaaS-oriented transformation – particularly in the United States. But rival platforms were less robust and focused on a handful of local charities instead of the thousands of global charities that donors can support using the Spark platform. Donation and fulfilment processes were also slow and cumbersome.

But superior technology alone wouldn’t ensure Benevity’s success. “Part of our strategy was changing the narrative,” Mr. de Lottinville explains.

Specifically, he points out that most organizations had traditionally focused their corporate social responsibility initiatives on fundraising but hadn’t tied those programs to driving improved employer brand awareness or to boosting talent attraction and retention.

That was until it became apparent that top professionals in the millennial cohort preferred to lend their talents to equally social-conscious employers.

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“A millennial who has grown up in that democratized, empowered online environment wants accountability, choice, user-centricity, interactivity and a bunch of things that the status quo wasn’t delivering to them,” he says of the group’s charitable-giving preferences and desire to work for an employer committed to making a social difference.

“We made a choice to make agents of change within companies that would create a compelling corporate culture and, increasingly, one that companies realize is their most sustainable competitive advantage.”

Staff and their dogs at Benevity headquarters.

Todd Korol/The Globe and Mail

But did those investments in Benevity’s product – organizations pay a monthly fee to use Spark, while the company takes a percentage of donations made through its platform – deliver benefits to its clients?

According to a Benevity survey of 115 of its enterprise-level subscribers, which benchmarked the average employee turnover rate across those companies at 28 per cent, the answer is “yes.”

When employees across those client organizations made donations, that turnover rate declined to 18 per cent, 17 per cent when people volunteered and just 12 per cent when employees did both, according to Benevity data.

“It’s not necessarily causal, but [giving is] highly correlated with engagement and the obvious churn cost savings that flow from [decreased employee] departures,” Mr. de Lottinville says.

What’s his advice to other CEOs on the cusp of a digital transformation that could help to position their company for accelerated growth? Be brave and challenge the status quo.

“Many companies, especially companies of size, have difficulty turning the ship, and yet digital transformation and the speed at which companies can be disintermediated these days requires that we be extremely nimble and embrace innovation and constructive disruption. We need to go out looking for it.”

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