With startup fundraising down nationwide, one Chicago startup is finding that it doesn't need venture capital funding to grow.
Goodsend, a Chicago-based peer-to-peer giving platform, has been focusing on pitch competitions and grant opportunities rather than traditional funding platforms to grow.
The company was one of six companies selected this month to join Blackbaud's tech accelerator, a program that supports early-stage software companies focusing on solving problems that matter to the social good community.
And founder Arjun Srivastava recently won a pitch competition for South Asian entrepreneurs.
He described Goodsend as being mostly "bootstrapped" and "largely self-funded" to start.
"I feel like I'm in a unique place where I'm a social impact startup so I think fundraising is a bit difficult overall. I'm not the sexy Web3 or AI startup," he told Chicago Inno.
For him, participating in pitch competitions and accelerators has been more valuable to the startup's growth than pitching VCs that dramatically slowed down their spending in 2022.
"The accelerators that I've been a part of so far have done a really good job of surfacing opportunities more than anything," Srivastava said. "They do a really good job of constantly sending out grant opportunities and other accelerator programs."
He said accelerators he's participated in have helped to keep him become more accountable and to build his network.
Goodsend inspired during Covid lockdown
Srivastava described Goodsend as a direct giving platform for Chicago similar to GoFundMe.
The main difference is that he wanted to create a platform that was "more trusted" as opposed to GoFundMe where "anyone can come in and create a fundraiser," Srivastava said.
"Goodsend doesn't work that way. We only source candidates through partnerships that we've built with schools and nonprofits in the area," he said.
Goodsend currently works with around 28 Chicago Public Schools and eight different nonprofits in Chicago.
Operating since early 2021, more than 1,100 donors have signed up so far and have sent more than $52,000 in cash donations directly to nearly 350 students and families that needed help in Chicago.
The idea of Goodsend came to Srivastava when he was sitting at home one day during the start of Covid and started to feel pretty privileged because his job wasn't affected. He started getting into digital direct giving on Twitter, where people who needed help with bills would tweet out their Venmo handles.
"That was kind of my aha moment where I just thought it would be cool to have a platform that made that type of direct giving easier," he said.
Srivastava envisions taking a few dollars out of his paycheck every couple of weeks and sending it directly to different members of the community who need help.
He hopes to see 5,000 to 10,000 donors sign up to join him by the end of the year.
