DonorDrive Announces Support for Donor Advised Fund Payments with Chariot Collaboration
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Insights
The collaboration between DonorDrive and Chariot to integrate DAFpay™️ into DonorDrive's platform represents a strategic move within the philanthropic sector, particularly for enterprise nonprofits. This integration is expected to streamline the donation process, making it easier and more efficient for donors to contribute through Donor Advised Funds (DAFs). By simplifying the giving process, DonorDrive is likely to see an increase in donor engagement and retention, which could translate into higher donation volumes and, consequently, increased revenue for their clients.
From a market perspective, this enhancement in donation processing technology could position EngageSmart, DonorDrive's parent company, favorably among investors. The ability to capture a larger share of the growing DAF market—where an average gift is significantly higher than individual donations—could be a compelling value proposition. As DAFs continue to gain popularity, with a 9.1% growth in giving as per the National Philanthropic Trust's 2023 report, this move by DonorDrive may set a precedent for similar platforms looking to tap into this lucrative segment.
Furthermore, the integration of DAFpay™️ aligns with broader industry trends towards digitalization and could serve as a differentiator in a competitive market. Nonprofits that leverage this technology may gain a competitive edge in fundraising efficiency and donor satisfaction. The impact of such innovations on the stock market can be multifaceted, potentially affecting EngageSmart's stock performance as investors may view this as an indication of the company's adaptability and growth potential in an evolving philanthropic landscape.
Analyzing the financial implications of the collaboration between DonorDrive and Chariot requires a consideration of the potential for increased donation processing efficiency and the subsequent cost savings for nonprofits. The integration of DAFpay™️ is likely to reduce administrative burdens and costs associated with manual donation processing. This efficiency gain could free up resources within nonprofit organizations, allowing for a reallocation towards other mission-critical activities, potentially improving their overall financial health.
For EngageSmart, the parent company of DonorDrive, the anticipated increase in platform adoption and usage could lead to higher recurring revenue streams from subscription fees or transaction-based pricing models. As nonprofits increasingly rely on digital solutions for fundraising, EngageSmart's financial performance may improve if the company successfully capitalizes on this trend. Investors will likely monitor the adoption rate of the new feature and its impact on EngageSmart's top-line growth.
It is also important to consider the scale of the DAF market. With billions of dollars held in DAFs, the ability to effectively tap into this pool of funds could represent a significant growth opportunity for EngageSmart. The financial performance of the company post-integration will be a critical indicator of the strategic move's success, potentially influencing investor sentiment and stock market performance.
The integration of DAFpay™️ into DonorDrive's donation forms is poised to have a substantial impact on the operational aspects of nonprofit fundraising. Nonprofits are under constant pressure to innovate and find new revenue streams, especially in light of the reported decline in individual giving. The ability to accept DAF payments directly online addresses a critical need for efficiency and donor convenience, which is paramount in maintaining and growing donor bases.
By offering a seamless donation experience for DAF contributors, nonprofits can potentially unlock new funding sources and engage with a demographic of donors who are both capable and willing to make substantial contributions. The immediate access to donation details and donor information can significantly enhance relationship management and donor stewardship strategies. This level of data integration and accessibility is crucial for nonprofits to effectively communicate with their donors, personalize their outreach and foster long-term donor relationships.
The anticipated improvements in donor retention and increased frequency of donations due to the ease of use introduced by DAFpay™️ could be transformative for nonprofit organizations. As a consultant, the focus would be on advising nonprofits on how to best integrate and promote this new payment option to maximize its potential benefits, thereby strengthening their financial stability and expanding their impact.
Individual giving experienced a
Many DonorDrive clients already accept DAF gifts, but processing these donations is tedious and time-consuming for both internal staff and donors. With DAFpay™️ by Chariot, donors can grant directly from their DAF account to a nonprofit’s DonorDrive fundraising campaign or event. The benefiting organization will receive immediate access to details including the gift amount, donation status, and the donor’s contact information in the DonorDrive platform. With all of this information saved in one place, nonprofits will have a simpler way to engage donors and help drive donor retention. The organization will also receive all these DAF gifts electronically, saving meaningful staff time while reducing the risk of lost or stolen checks.
DAFpay™️ will be an available payment option for all DonorDrive donation experiences, including DonorDrive’s newly released Embedded Donation Forms. In addition to DAFpay™️, DonorDrive offers a variety of donor payment options: all major credit cards, multi-currency, ACH, and digital wallet options PayPal, Apple Pay, and Venmo.
“Across the philanthropy industry, nonprofits are searching for expanded and creative ways to increase funds raised as individual giving declines significantly,” said Kasey Cuppoletti, Senior Vice President, Product at DonorDrive. “At DonorDrive, we’re constantly looking for innovative ways to help our clients combat those trends and acquire more donors. Through our collaboration with Chariot, Donor Advised Funds provide a great opportunity for our clients to increase revenue, reduce friction in the donation process, and improve efficiency for their internal teams.”
“Having a Donor Advised Fund payment option superpowers fundraising efforts and creates a more streamlined experience for donors," said Aaron Kahane, Co-Founder and COO of Chariot. "By collaborating with DonorDrive, we’re making it easy for donors to contribute directly to the organization of their choice, especially as part of high impact peer-to-peer campaigns. We estimate more than 3 million donors have access to Donor Advised Funds. DAFpay™️ by Chariot simplifies the DAF donor giving experience, increasing conversion rates and donation frequency, and helping nonprofits steward their donors by enhancing the ability to thank and connect with donors immediately after a donation is made.”
About DonorDrive:
DonorDrive, an EngageSmart solution, is an advanced digital fundraising platform for nonprofits that turns everyday people into powerful fundraisers. Drive more revenue for your cause with the most immersive, connected, and well-designed fundraising experience ever made. For more than 20 years, DonorDrive has helped hundreds of nonprofits like Children's Miracle Network Hospitals, American Foundation for Suicide Prevention, Covenant House, Doctors Without Borders, Muscular Dystrophy Association, World Vision and hundreds more to raise billions of dollars. To learn more about DonorDrive, visit www.donordrive.com.
About EngageSmart:
EngageSmart is a leading provider of vertically tailored customer engagement software and integrated payments solutions. At EngageSmart, our mission is to simplify customer and client engagement to allow our customers to focus resources on initiatives that improve their businesses and better serve their communities. EngageSmart offers single instance, multi-tenant, true Software-as-a-Service (“SaaS”) vertical solutions, including SimplePractice, InvoiceCloud, and DonorDrive, that are designed to simplify our customers’ engagement with their clients by driving digital adoption and self-service. As of September 30, 2023, EngageSmart serves 116,200 customers in the SMB Solutions segment and 3,400 customers in the Enterprise Solutions segment across several core verticals: Health & Wellness, Government, Utilities, Financial Services, and Giving. For more information, visit www.engagesmart.com and follow us on LinkedIn.
About Chariot:
Chariot is the only Donor Advised Fund (DAF) fundraising solution for nonprofits. DAFs are the fastest growing funding source in philanthropy and hold
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View source version on businesswire.com: https://www.businesswire.com/news/home/20240123518531/en/
Media:
Nicole Bestard
Quarter Horse PR
donordrive@qh-pr.com
Investor Relations:
Josh Schmidt
EngageSmart, Inc.
IR@engagesmart.com
Source: EngageSmart
FAQ
What is the collaboration announced by DonorDrive and Chariot?
When is the new feature expected to be available?
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What percentage of decline in individual giving was recorded in 2022?
How much is the average DAF gift?
How much is held in Donor Advised Funds waiting to be donated to qualified organizations?
What are the expected benefits of the collaboration?
