Mitch Stein · CEO, Co-founder, and Chief Impact Officer, Pond | Mitch Stein is the CEO, Co-founder, and Chief Impact Officer of Pond (formerly MPowerUs) a nonprofit-focused community that's challenging the attention economy by centering connections rather than the core systems we currently cling to. In other words, they're making nonprofit tech about the nonprofits!
Today we're talking to a compassionate (former) banker. A guy who shifted to the nonprofit world from Goldman Sachs after fundraising for a cause close to his heart. Someone who can see how much the for-profit world needs to learn from nonprofits... instead of the other way around: Mitch Stein.
In both his capacity as both a nonprofit leader and the founder of a tech startup, Justin Wheeler, Funraise CEO and Co-founder, cheers this viewpoint and explains that it's a major reason that Funraise put so many resources into building a free product in 2020. Nonprofit growth goes hand-in-hand with impact growth, but it's often overlooked—most nonprofit vendors, funders, and yes, donors(!) default to that stubborn idea that nonprofit overhead is impact's ol' ball and chain, holding nonprofits back from great change.
Listen as Mitch puts a financial valuation spin on nonprofit investment, looks at nonprofits through the lens of expected future impact instead of the stigma of overhead, turns donors into equity stake investors clamoring for impact rather than profits, and paints a picture of a future where nonprofits are publicly traded based on their impact potential.
Hello, I'm Justin Wheeler, and welcome to this episode of Nonstop Nonprofit!
Today we’re talking to the nicest, most compassionate (former) banker I’ve ever met. A guy who shifted to the nonprofit world from Goldman Sachs after fundraising for a cause close to his heart. Someone who can see how much the for-profit world needs to learn from nonprofits... instead of the other way around: Mitch Stein.
Mitch is the CEO, Co-founder, and Chief Impact Officer of Pond, formerly MPowerUs, a nonprofit-focused community that’s challenging the attention economy by centering connections rather than the core systems we currently cling to.
In other words, they’re making nonprofit tech about the nonprofits! (Finally!)
As both a nonprofit leader and the founder of a tech startup, I gotta say... this is the way it should be, and a major reason that Funraise put so many resources into building a free product in 2020. Nonprofit growth goes hand-in-hand with impact growth, but it’s often overlooked—most nonprofit vendors, funders, and yes, donors(!) default to that stubborn idea that nonprofit overhead is impact’s ol’ ball and chain, holding nonprofits back from great change.
Listen and prepare to cheer as Mitch puts a financial valuation spin on nonprofit investment, looks at nonprofits through the lens of expected future impact instead of the stigma of overhead, turns donors into equity stake investors clamoring for impact rather than profits, and paints a picture of a future where nonprofits are publicly traded based on their impact potential.
Justin Wheeler Mitch, welcome to the podcast, how are you doing today?
Mitch Stein I'm doing great, thank you. Really glad to be here.
Justin Wheeler Yeah, excited for the conversation that we're going to have, which was inspired through brief chat over LinkedIn, just about how to look at nonprofit impact and how to make the right investments to achieve as much impact as possible. But before we jump into that, if you could just share a little bit about your background. I think it's super interesting, especially as we dig into today's topic, as it will help validate a lot of your thinking. And if you could just give us a little background about yourself and what you're up to.
Mitch Stein Yeah, of course. Hey, everybody. My name is Mitch Stein. My pronouns are he/him. I, before jumping into the startup world was in the nonprofit space, was an investment banker for seven years. So I worked at Goldman Sachs in New York City, a number of different jobs. I worked in the capital markets for four years for a lot of power and utility businesses, natural resources companies doing all kinds of debt financing and derivative instruments. Did a year and a half stints in the middle where I was actually working directly for the CEO, spent time working for Lloyd Blankfein, running his client strategy. So that was very nonmarket focused, but very got a good sense of the broader company and just all the different components that go into the banking sector. And then from there went into the tech and media business where I was working on mergers and acquisitions and IPOs for primarily software and Internet businesses. So all and all seven years and much different areas of the bank, that just gave me a lot of perspective on financial markets. But I think markets and marketplaces more broadly, which I think we can dig into more today, just super relevant to the nonprofit sector, which is so fragmented in so many ways and lacking in a really good market structure and infrastructure that we see the benefits from in the finance world. And I think would be really cool to bring some into the nonprofit space.
Justin Wheeler Absolutely. And I'm excited to dig into that. But I have to ask IPOs, mergers, acquisitions, banks, how did that bring you into the nonprofit sector? Would love to hear that story.
Mitch Stein Yeah. So outside of work in my "free time" as always have to put air quotes around, I was and is getting really involved in the nonprofit space in New York City. So I was on the board or I am on the board of the LGBT center in New York. It's the second-largest LGBT center in the world and they see over six thousand LGBT folks in the community every week. My dad and I joined an event with them called Cycle for the Cause, which is the Northeast AIDS ride from Boston to New York. We had lost my Uncle Marlin to AIDS in the 90s and had the opportunity to kind of reprise his memory and revive his legacy in a really cool way by joining the ride together in 2016. I'd never done any real major fundraising in the past before that, so no real expectations, but ended up raising over four hundred thousand dollars for the center over the past five years on the ride and so really got the bug of fundraising. So despite never having worked at a nonprofit, I just fell in love with that dual like that dual sense of spreading the word and bringing the cause to people, and especially something that a lot of people aren't very educated about, like, oh, I didn't realize AIDS is still an epidemic. I thought that was in the eighties. Why does that still matter? Oh, I didn't realize it was still ravaging communities of color at disproportionate rates and trans women of color fifty times more likely to contract HIV than other parts segment of the population. So it's still a massive issue. And so it was really gratifying to not only bring awareness to that, but then also know that we're able to really command a lot of resources to that cause area in such need. And so I think with getting the bug I, as so many other people do in the fundraising space, I started making spreadsheets. I started writing one on one emails. I started doing all the manual things. And I had like I was just abusing the Goldman Sachs email system. Like surprised I still was able to send mass emails through it. And just had, like I said, like these long models and spreadsheets, I would be like as if I was building a financial model. But to track like year over year donor performance by category and state and country. And we had like thousand donor records. So it's just like manually doing it all kind of for fun. But it just made me appreciate how hard it is to scale that type of impact with fundraising, without good tech. And then I was a part of the center's kind of advisor, encourage them to look around at other tools and things they were using around the event. And that was my first insight into just how I mean, I would describe it as chaos. And I don't say that is disparaging to the center at all and came to find that that was they were probably one of the most organized and most diligent and most thoughtful around how they searched their deck. And I knew that an organization with so much so many resources and staff and everything that. Just wasn't even accessible for small organizations in so many instances, like it's the search for tech and that process of accessing, implementing it, having the resources to maintain it was inefficient at best, at the best organizations and just downright inaccessible at the smallest organizations.
Justin Wheeler And so that that led you to start, I believe, what your current company is. You want to talk about that? Pond, is that right?
Mitch Stein Yeah. Yeah. So Pond, we just launched two weeks ago, rebranded from MPowerUs, if you'd heard of that before. But the whole goal of Pond is to shrink the ocean. I think for so many people as I got to speak with hundreds of nonprofits in the past year, all during the pandemic, isolated and at home. And it just got this overwhelming sentiment of like, I'm overwhelmed, I need help. Everyone's asking the world of me. And then yet I feel expendable like that sentiment from people of like I'm expected to use all find and use all this great tech to advance our job as we move virtual and digital and completely change everything we do for fundraising in my entire job function changes in my salary go up, then my hours go down. No, actually, most people's had their wages curtailed or were furloughed for a period of time and their demands and expectations went up. And so I just felt this like added need to make something easier for folks and make tech more accessible, because that was really, I really viewed as the key someone who worked with so many different tech companies in my prior job. I can see the value it unlocks for people when it's accessible. And I just think if we can stop yelling to say, use better tech, find better tech, do this, do that and just say like, what do you need? Like what do you want? And I trust you to actually be able to express what you need and want. And so that's what Pond does. A nonprofit can create a listing in their own words, say what they need or what their problem is, and leave it up to the tech provider and the vendor to say, oh, yeah, that's the right type of customer for me. And I'm willing to pay for that because I didn't have to go searching and making cold calls and spam emailing and chasing people. I'm going to connect with you on your terms and we're going to be in a meeting where everybody wants to be there. So the outcomes are just so much more efficient and productive. And that money, instead of us extracting that from the system, one hundred dollars goes directly to the nonprofit's account to spend on tech. And so, like, say, you had ten calls. If you're evaluating serum's and you heard from fundraise and you heard from a bunch of competitors and obviously fundraisers are going to have the best pitch. And so then at the end of all that, when they're ready to make a decision at any time, they can say, OK, well, I've got a thousand dollars to knock off my Funraise bill to get started. And for a lot of folks, that could be six months, nine months, a year to give them the chance to ramp up and not even have to worry about the whole ROI discussion. They've got time to prove it.
Justin Wheeler Yeah. So that's awesome. It's you know, there's lots of conversations in marketing about how do you find buyers with intent, lots of things that really don't work or you have to spend a lot of money to find that intent. And it sounds like what Pond is doing is it's aligning the intent with the vendor and then to have a more honest, transparent conversation. So, it's fascinating. Congratulations on what's been accomplished so far. Excited to dig in and definitely excited from a business perspective to use your site as well as I imagine it's going to be super productive for us.
Mitch Stein Thanks. Yeah.
Justin Wheeler Maybe the last question on this, then we'll jump into sort of what we were talking about the other day on LinkedIn. How big of a market do you think it is? Obviously, you've done a lot of research within the industry. What are sort of the goals and how does that connect back to what the opportunity market size is for the business you've started?
Mitch Stein Yeah, so the nonprofit market is fascinating. The number one piece of advice I got and we're going to start a startup, which is plenty of people leave Goldman to go try to do their own thing and have kind of illusions of grandeur. And I had the number one piece of advice I got was, well, don't go make a company for nonprofits. They're terrible customers. And I was like, but what if we made a company that made them better customers? And by the way, that doesn't mean we need to change them. We actually need to change the way the system works around them, which I'm saying this from a place of like learning that over the course of a year I started in the place of like, oh, we need to inform and educate and that's how we're going to make change. And it's just not you've got to, like, meet people where they are. So your question about the market size, I mean, the numbers, I'm sure you've heard in general, like 5% of GDP is spent by nonprofits. It's a lot of big universities and hospitals, but a huge part of the economy, one in seven employees over one and a half million individual organizations, the largest tech provider to the space, as you know, is Blackbaud. And this number is directional. So don't quote me on it. But their total number of customers, do you have a guess of what their total customer number is?
Justin Wheeler I mean, I did some research on this as when we were raising capital to understand sort of like what sort of market penetration we would need to get. And I was actually surprised at the time I saw something like twenty five or thirty thousand nonprofits, which when you're looking at 1.5M, is nothing.
Mitch Stein Exactly. So I don't know the exact number either. I think it's like forty five thousand, but they have seventy five to 80 percent of the market like those numbers should absolutely floor you. If you're just thinking about the market itself. And so when you say what's the market size? And I go back to my original example of any nonprofit that wants to use tech and wants to talk to you about it, like let's just use Funraise as an example. All of a sudden. It doesn't need to be a free product because every single organization can have buying power just by virtue of spending their time on it. And so this is where I think you start to unlock, like, OK, at a bare minimum, let's say an average number of calls someone does over the course of a year is ten. And by the way, I think that hundred dollars amount could probably go up. And I think there will be other ways to have value, like doing a survey or a market research other than just listening to sales calls, which is the most exciting for our members, but critical at the point in time. They're looking for tech. So let's say it's like an average thousand dollars a year times 1.5M, and that's like spend no one had to go raise money for. That's a $1.5B Market that's created by funneling money that you could have been spending on Facebook ads or LinkedIn ads or Instagram ads and put into the pocket of the nonprofit. That doesn't have to go through the revolving door of the donation through the front door, because then it has to go through their whole budgeting process. And I know we could have a whole nother conversation on the overhead tax, which is like a massive issue that systematically lowers tech investment, which is the only way to which we get into this later, but that's the only way if you don't invest, nothing's going to happen. It's just that you're just sitting in a poverty cycle.
Justin Wheeler So, yeah, we're actually getting into that right now because I think it's it's super interesting and I love your perspective on it. But just to kind of bring up listeners up to speed on on the conversation you and I had briefly last week, we were talking about investing, like nonprofits, they only have a few levers for growth that they can invest in. And oftentimes those those levers are caught up in overhead expense. Right. And we know that if nonprofits overhead expense, their financial ratios look different than the industry, average red flags go up. Maybe donors pull out, donors don't give and so forth. These financial ratios are incredibly crippling for nonprofit organizations because it doesn't allow them to invest in future growth in the future. In fact, they really created this whole ecosystem in the nonprofit community to really survive year by year. And when you're trying to survive, you're not growing, you're not thinking about the future. You're not investing in R&D, you're not investing in the things that are actually going to generate more revenue and therefore significantly more impact. And you mentioned in a response to that post that I posted on LinkedIn, he talked about, you know, the way I'm going to have you say in your own words, you talked about if we looked at future impacts of nonprofits, like we look at future growth in public markets, there could be something really interesting that happens. And so I want to open the floor for you to maybe expand upon that concept a bit more because it was absolutely thought-provoking. And I'd love to have some discussion around that.
Mitch Stein Yeah, absolutely. And I. I might get a little, I'll be very candid. So probably not a lot of stuff you'd expect to hear from a lifelong Goldman Sachs investment banker. But let's start with the overhead ratio, OK? Because nonprofits are dependent upon market surplus. So they're like a leftover of the normal market. What you're willing to donate beyond what you consume for yourself for a profit that you make as a company or what you leave behind, which is obviously a huge source of funding for the space through foundations. So it's a result of market surplus. And yet the funders want to treat nonprofits like they look at investments. So so when I make an investment in an equity, they make their quarterly report and they get audited. And everyone's really focused on one of those numbers. Are you spending wisely? You're not wasting you're making money. OK, great. Your future earnings look good. Share price goes up because this is valuable. People bring that same mindset and expectation to how they fund a nonprofit with none of the upside. And there's no tangible, linear way to capture their impact. So it's like I, as the nonprofit leader, don't have a leg to stand on in that system with the current structure. And what? That ultimately does in how you see this play out is people are like, OK, yes, I want you to have this money. If you come to me on hands and knees over broken glass to fill out this grant application next to hundreds of other people who are begging for my largesse because someone rich died one hundred years ago and left this money to be like administered to people. And so it's like that whole construct is so bizarre to think about when you just take a step back. And with that I say, OK, I'm giving this money. But like, was that gift for you or for me if I still am in charge of how it spent? So who is the serving? And, you know, by me making some requirements about how it spent even something as simple as like overhead, I'm telling you, as a nonprofit leader, I don't trust you. I don't trust you, even though you're the one on the ground doing the work every day, I'm just not really sure that you're going to you don't have a financial background. So, like, how could you possibly spend this money wisely on where it's really needed? Right. And so with that, you just make sort of like with a blunt instrument, say 80% needs to go to your programs to prevent you from bad acting, because that's my biggest problem as the foundation or the major donor. I'm worried about bad acting on your behalf. Yeah. And so with that 20% left, you say, OK, well, shit, I got to cover my staff. I kind of cover my building, my utilities, my my supplies, whatever, depending on what your organization type is, how much is left for tech, right? The actual and the reason you know how powerful those percentages are to people is the percentage spent on tech is the same no matter the organization size. Right. So it's somewhere between one to two percent. This was pre-pandemic, so I'm hoping it's a little bit higher than the ones that have the new tools, but one to two percent no matter the size. And you think about that in the context of a company, private or public, but a profit earning company. If you are spending one to two percent of investment in your infrastructure as a brand new company, you're just never going to exist because you have to figure out a way to sustain yourself. You aren't receiving that largesse, that surplus.
Justin Wheeler Right.
Mitch Stein And so that's the negative consequence of trying like trying to control how the money is spent and how it reaches impact. And when you think about that from the for-profit side of things, I mentioned that a little bit. But there's an expectation that you're going to invest. There is a need for a company to set up their systems and tools and ways of operating and their business model and their products like R&D. With research, they have to innovate. By hiring. They have to hire really good people in order to deliver that service and be superior in achieving their goal, which is profit. And there just needs to be more of that mentality. I mean, I can get into, like a futurist kind of thought about how this could work in the future. But that is the problem in a nutshell. It's like if you're focused on control, then they're not. Then you're going. It's a poverty cycle. It's like leaving somebody in the you know, the company store in the company town. They don't there's nowhere else for them to go.
Justin Wheeler Right. You know, there's a couple of things I'd like to kind of unpack that that you brought up and also provide some comments. I think sort of the problem that you just laid out, it's really true across all different types right now. It's not just like foundations and corporations, but you see I mean, you see this in individual donors who want every single dollar to go to the program. And it's because we've and I think this is the, in regards to why this problem has persisted for so long, I think the responsibility is both in the nonprofit and for-profit side of things because we try to create new programs and marketing messaging around the one hundred percent model. I mean, I'm pretty vocal about this. Like I'm not a huge fan of 100% model because it perpetuates this, hey, programs are good, overheads bad. We've got to find different donors to fund different things because overhead is not connected to programs. The reality is the stronger your operations, the more efficient, the more effective, the more that you will be able to prove on the program side of things. And so what is it? What do you think it's going to take to to move the conference? Because we've we've been having this conversation for years. And so what does it actually take?
Mitch Stein Again, I'll be very candid. We had a conversation on our team. We're thinking about our own, like, you know, where I think we're new. We've just taken this big step releasing Pond two weeks ago, and I'm really excited about it. But there's so many places to go. And one idea we had was like, OK, charity: water was incredible at activating people with really amazing marketing, feeling like they were having the ultimate impact and difference, like the, you're talking about the one hundred percent model. So I don't want this to come across as disparaging of charity: water whatsoever because they've obviously done an amazing job and amazing work. But our thought was like, what if we could from a marketing perspective, try to be like the anti-charity: water? What if we made, like tech investment the sexy thing you could do for a nonprofit? Like what if you want it? Can we get individual donors? As you said, they're a reflection of the same thing. I was using foundations as an example, but you're totally right. It's a reflection of the same system because, by the way, it's their surplus, it's their personal like what they took away from their job. And so it's the same mindset of like, OK, I'll part with this money. But I have an expectation about it's not really charity. Even though I got a tax write-off for it, I still have an expectation of control and power in that dynamic.
Justin Wheeler Yeah.
Mitch Stein I don't know. Could we, could there be a marketing push that's like tools are sexy for a nonprofit like if they are, you want them, you should start asking, like, why aren't you spending more on your tech as a donor? And if we can't do that within the current construct because you can't get away from your annual Charity Navigator rating and it doesn't matter if one donor thinks that way, you need everybody at once. OK, what about could you put money in their Pond account? And it's separate from the normal budget. I don't know where this is total brainstorming, but it just feels like there's something we need to do, something outside of the system like the current. You can't really get away from it in the current system because they're so tied that year in number every year, regardless of if one funder is down with the way things actually need to be.
Justin Wheeler Totally. You know, what could be interesting is and this kind of piggybacks off of your comment to the to the original post about how value is created by looking at sort of future earnings. And so we give these multiples to companies based on that know, thinking about from a from a donor perspective. Right. If a donor invests, call it a thousand dollars into a nonprofit and there's a period of time, maybe it's five years for that gift to actually grow based on the organization's growth, the value it's creating, the impact it's creating, and the way the donor gets rewarded maybe for that growth, making that initial investment, is maybe like a true up on taxes, a further deduction. So it's kind of like the inverse of a capital gains tax. It's it's a capital gains tax deduction or something like that. That could be interesting because then it's you go from what can we accomplish this year versus what can I invest? What organizations that I invest to today will have this enormous impact in four or five or six years. And it's maybe it's still self-serving because there's more reward for the donor. But I think like in order for us to change the model, we've got to think about how do we incentivize the donor to stop caring about these ratios. That really makes zero sense to running a business.
Mitch Stein Yeah, I would. I love that idea. I haven't heard of that before. I think there's all levels and layers that you can try to attack this. So to me, that's so that's going out like the donor issue with a structure. There is another structure. There's a company called NPX, a woman named Katerina Schwab and Lindsey Beck are the co-founders. They've created this really innovative funding structure that donors pool, like donate to the fund but investors are actually investing in the security. And then the rate of return to the investor is based on how the nonprofit that its funding achieves their impact metrics that are laid out beforehand.
Justin Wheeler Interesting.
Mitch Stein And so I think so for you, you're sort of like addressing the donor side then. This, I feel like, is addressing kind of the structural side. And I feel like what hopefully we're getting at with Pond is the systemic side because I think there's room for all of them and they're all important. But even your example, it relies upon a common language and it relies upon a way of measurement of impact across all 17 sustainable development goals. Or like maybe you fit slightly outside of any of those. It's like so hard. But I think if we can move towards that common data model and folks speaking someone of the same language, at least within the same cause areas, that could be a big step towards that. And one of them, it's a bit of a hypothetical. I don't know how long it would take to get there, but think about a nonprofit using pond and they have what is the value to a seller, a vendor on that platform selling to nonprofits? Yes, they are a customer and a paying customer. But even for you, Justin, you could have gone and founded a business and like direct consumer sunglasses or something and maybe made a quicker buck. But you did this because you look absolutely, really care about it and it shows and everything you do. And so there is that sense of impact that you get and you benefit from by serving the sector.
Justin Wheeler Totally.
Mitch Stein And I think when you put yourself in the nonprofit shoes picking providers, I think that has a huge impact in their decision process. So like, say, I'm looking at Fundraise and two other competitors and say that I feel like the products are relatively similar and the pricing is relatively the same. And like, I don't really see any differences. What am I going to make the decision on? I would put out there that the primary decision point is impact. And if you can demonstrate that in a market where you're able to say, well, we had a thousand at bats and we won 80 percent of them solely on our impact, not because of our margin as a business. So you can turn on your investor and be like, OK, so I know you want to look at me, these multiples of what we do with our margin and where our cash flow is. But guess what? Right now, the only thing that matters for mine, I think your profitability and success as a company is my ability to have and communicate my impact. And in that instance, I just think about scaling that up to other industries where over time that investor would say, OK, Justin, invest more in your impact, give more money away, like figure out more innovative ways to have an impact as a company in addition to making a profit, because that's what drives your business. And in that instance, over time, what's the better indicator of your business performance? Is it your ability to decrease your margin or sorry, ability to expand your margin or your ability to expand your impact? And I think that's where the market itself could start to transition away from the need for that future tax write off or like cash return if it just becomes clear that the value is in the impact. And how long until you just keep investing in impact, investing in impact, investing impact... when do you stop being just a tech company and you look more like a nonprofit? And that's that's when you now have shares that trade on impact for an impact organization, whether you're a nonprofit or for-profit?
Justin Wheeler I love that. And, you know, I mean, if you think about companies that have pioneered this, there are companies that have laid the ground for this. You know, granted could have been done better, of course. But you think of Tom shoes. This is an obvious example where they really, I would say, pioneered this. Like, every time we buy something, we give something away, invest. They really marketed the mission impact of their business. There was a point when you go to their website and you couldn't tell if they were for-profit or nonprofit. They knew that in order to sell shoes, they had to talk about the important work that they're doing all around the world by delivering pairs of free shoes. So I think that there's evidence that this can work. I mean, it was obviously an incredible exit for Blake that he had when when he sold 50 percent of it to Bain Capital. So there's proof that this can work. You know, and something as a former investment banker yourself, you said this in the beginning. You talked a little bit about upside and you know about upside, probably all too well as an investment banker. What are your thoughts on as it works today in the nonprofit space, strictly nonprofit, should there be upside for employees organizations? And if so, like, what do you think that could look like and how do we get there? Just a small question.
Mitch Stein Yeah. Yeah, it's a controversial question. I mean, my gut reaction is just like, yes, I don't know why, I mean, maybe you can even eliminate I don't even know what the reasons are, why you wouldn't do that. Because one thing I started doing for Pond, which has just been so mind blowing, was I'm in a founders' support group. So it's group therapy for startup founders.
Justin Wheeler Sign me up!
Mitch Stein It's amazing. And definitely I'll send you the link. I actually I was just talking to someone earlier this week about starting one explicitly for like startups serving the nonprofit sector because there's so much we can all cooperate on and we don't need to be isolated at all. But anyway, I joined this group like nine months ago and I would not still be doing this, hands down zero percent chance I would still be doing this, if I hadn't had that group every week. And I really, really felt it saved me. It's a company called Herd is the name, www.helloherd.com is their website, all kinds of group therapy. But the founders of that site hosted a founders group, so is really, really cool. And I was looking at all these nonprofits and the state that these people were in, burnt out, isolated, overwhelmed, those are the words I heard from like everyone I talk to. And I was just like, sure, I can try to explain why tech's going to work better for them. But if I don't start helping them feel like valued and a whole person, we've got nothing to go on and it's going to be falling on deaf ears. And that's where we got to start that human element. And that doesn't really sound like a tech startup to think like me. Having a one on one conversation is scalable, but I think it is. And I think we started our own support groups and I reached out to twelve nonprofits that were using our site and just said, like, hey, I had this idea. If you want to sign up, would love to hear if this is interesting. 10 out of the 12 of them signed up and put their credit card information in the same day.
Justin Wheeler Wow.
Mitch Stein So I was like, this is a big need. And we've been doing this for four weeks now. And my mind is just like blown by every one of those calls where I hear people say things like I have the expectation of being a super hero and yet the sentiment that I'm completely expendable. That was a direct quote from one of our members this week.
Justin Wheeler Wow.
Mitch Stein If that doesn't send you back in your chair to be like, what are we doing to these people, right? They have all the expectations of a for-profit job with, no upside for their work. And if we're all going to continue to exist in this capitalist society, which we can argue at a later point in time, but that's the fact of the matter is where we are today. So to just like have this crazy expectation that nonprofit people are saints and they don't need to be compensated for their time is just ludicrous. So, I mean, I just I can't even come up with a reason why you wouldn't have some type of upside bonus structure for your employees that are fundraising or delivering programs.
Justin Wheeler Because we only can spend 20% on overhead. That's why Mitch. Yeah, I mean, I think with what you just said, 100% agree. And I think the other thing I think that we would also see is we would see more talent come into the nonprofit space. It's already an enormous market. We've already got amazing people working in it. But when we can get more competitive and we could provide compensation structures that are more similar to the for-profit community, and you can all of a sudden make the hiring process more competitive, you can think about the problems that we're trying to solve. Maybe we can solve them faster. It's not going to be less expensive to solve these big problems is going to be a lot more expensive than twenty-five percent. And so I yeah, I'm a big I don't know how it works, how it looks, because there's no shareholders in nonprofits, but creating upside for the people who day in and day out are going above and beyond the call to make this world better deserve, in my mind, to be compensated very well for that level of sacrifice and hard work.
Mitch Stein Totally. I mean, the nonprofit sector exists in such a robust manner in the United States because we don't like big government and we purposely left gaps in what the government does and said, OK, we can fill this with the philanthropy. And so that just if those gaps were left because they were too hard to solve. So you've literally left out the hardest problems to solve for all the people that are most passionate about it, which is great. But if you're not supporting them in that, like, what is the point of, you know, leaving this opportunity for people's charity and then not providing any of the resources, you're just like starving that the hardest problems, the biggest deals we have the most red tape and restriction and rules and limitations around how they can operate.
Justin Wheeler Yeah.
Mitch Stein And I just think that's such a big fallacy of how we've set up this market as a country. One thing I did want to point out, though, because I do think it's tempting, especially for those of us on the tech side, to use the word competitive a lot as a good thing. And I think, as I mentioned at the beginning of the call, there's I feel like at this thoroughfare between tech and nonprofit or between finance, capitalist world and like the nonprofit world. And I just see so many things, like people need to learn in both directions. And one of those that I would not want the nonprofit sector to lose is the sense of cooperation. And I think that's-a value that is very much lost in the everyday of a for profit job where you're constantly focused on sales targets. I'm competitive with my fellow salespeople. I'm competitive with my competitors. They're literally called competitors, when you're all trying to do the same thing. And so to the extent that we can introduce more cooperation on both sides, I think, you know, I would not want competitiveness to become a goal of the nonprofit because I actually think, I mean, just think about any amazing achievement we've had as a society. And it hasn't been at the point in time we were at like pure laissez-faire capitalism, a hundred full tilt, percent. It's been when the entire global community came together to produce the Covid-19 vaccine. Right. Which was not dictated by any one company maximizing their own profit or like the railroad system being interconnected on a standardized system or a lot of examples like that that are game-changers were actually, the biggest game-changers were always deviations from market structure, not the like the ultimate market structure.
Justin Wheeler Yeah. That's great. A couple of years ago is the team at Next After, put together this retreat and there was about seven or eight of us tech providers, serving the nonprofit community, there along with a bunch of service providers. And we spent three days in Mexico basically brainstorming how could we better serve our customers, the nonprofit community and so forth. And I remember, basically the last evening we were there, Tim, who is the founder and CEO of that Next After, basically said, like, seriously, like if you guys leave this retreat and do nothing, we're never doing this again, because the point was, bring your minds together and to come up with super tangible, practical ways to better serve the nonprofit community. And lots of partnerships were birthed from there. Lots of opportunities, integrations built. So I totally agree with that sentiment, I think that we could do more Funrise could do more to cooperate with other players in the space that our customers are being mutually served by. And so I love that sentiment and agree there's so much for the for-profit market to learn from the nonprofit market. I think another one I'd add is just resilience. I think nonprofit employees are among the most resilient individuals I have ever worked with and coming from the nonprofit space, starting a for-profit, going through the ups and downs of a startup, I feel like if I didn't spend 10 years in the nonprofit space, I would have quit a long time ago. So I totally agree with that sentiment. There's so much that the nonprofit community can offer the for-profit. Mitch, we're running up on time. Thank you so much for joining the podcast and having this conversation. I look forward to many more to come in the future.
Mitch Stein Awesome. Thanks so much for having me. It was a lot of fun. Great to see you again, Justin.
Justin Wheeler Good seeing you as well. And good luck with Pond and looking forward to jumping on. Appreciate it. Take care.
Mitch Stein Bye.
Justin Wheeler Bye.
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