Like many lightning-bolt ideas, the web startup Generopolis was sparked by the mundane.
Meghan Winegrad and her two young sons were in their Glendale basement, picking over outgrown clothes and forgotten toys. Months before, Winegrad had left her job at Express Scripts to strike out on her own. After a lot of research, networking and analyzing data, the details of a would-be social enterprise were still fuzzy.
But it all began to crystallize as she talked to her boys about where to take their closet castoffs. They decided to create a sale on Facebook and allocate the proceeds for charity.
“No one was bargaining or haggling, and the items sold really fast,” said Winegrad. “People always followed through and picked up. That’s really rare. I thought, ‘I can’t be the only person who wants to do this.’”
Even with the ubiquity of online marketplaces such as Craigslist and eBay, she had discovered a gap.
There was no site where users could earmark a sale for a nonprofit, and buyers could be assured that the proceeds would actually get to the organization.
Winegrad, who has an MBA from Washington University, had spent her corporate career identifying trends and building products at companies such as General Mills and Hill+Knowlton.
She took the same approach with Generopolis.
During her research, she found generational differences in donating: Millennials have less money to give but are no less interested in philanthropy.
“They have a different set of expectations for nonprofits. They want to be hands-on, not just write a check,” said Winegrad, 41. “I wanted to make giving accessible for everybody. It’s a noncash model that creates cash.”
The number of registered nonprofits is on the rise, with 1.5 million in the United States, according to the National Center for Charitable Statistics. But donations have not budged over the last 50 years — hovering at about 2% of disposable income. And there’s been a drop in the number of small donors.
Winegrad sees her business as a way to counteract that.
When she launched the Generopolis website in February, she embedded an explainer video detailing how a set of gently used golf clubs, for example, could turn into a donation for a domestic abuse prevention agency.
Users create a free account and post a photo, description and price for their offerings, which they can share on Facebook, Instagram and Twitter. They designate the nonprofit they want to fund. Buyers and sellers work out delivery details via a chat function. Generopolis keeps 10% plus 30 cents for each listing, and the charity receives the rest.
Sellers have offered items such as DVDs, worn-just-once formal dresses, Cardinals windbreakers and “Star Wars” lightsabers.
But the person-to-person sales — there have been about a hundred so far — are just the start. Services are on the menu, too. Pilates sessions. Home-baked cookies. A private performance by the Big Muddy Dance Company.
Erin Prange, executive director of the nonprofit Big Muddy Dance Company based in Grand Center, said that when she heard about Generopolis, she thought it was brilliant.
“I encouraged dancers to step forward and do what they can,” she said.
Like offering a guest spot on the Big Muddy podcast or wedding dance lessons. The proceeds benefit Big Muddy’s educational and senior citizen outreach programs, but the publicity also helps the dance company reach new audiences.
Big Muddy rolled out a social media campaign to ask folks to turn to Generopolis with their spring-cleaning remnants.
“We haven’t spent any money to do all this,” said Prange. “Unlike a gala or special event that costs a nonprofit money. It’s very cost-effective.”
Nonprofits can also extend their reach beyond a single fundraising event. The Foster and Adoptive Care Coalition’s annual auction of designer purses was held in April. But those who couldn’t attend Hope in a Handbag marketed and shopped for slightly used Kenneth Coles or Chanels via Generopolis.
The flexibility of the format also allows for creativity, an attribute that appealed to the Magic House when Winegrad approached the children’s museum about a partnership.
Generopolis will be a component of the Magic House at MADE, a satellite location opening this month in north St. Louis. The “makerspace” for kids has art supplies, sewing machines, a robotics lab and 3D printing.
The Magic House enlisted its ranks of young entrepreneurs to “be guinea pigs for the space,” said Carrie Hutchcraft, the museum’s chief administrative officer. Those crafters and builders will learn about how to market and price their creations on Generopolis. They’ll choose the nonprofit they want to help.
In a focus group, “the kids really embraced the idea,” said Hutchcraft. “It’s a powerful way to encourage entrepreneurship and giving back.”
The business side
Winegrad is not sure yet where Generopolis will fall on a continuum that has peer-to-peer sales fueled by nonprofit campaigns on one end and Groupon-style deals donated by businesses at the other.
Three months in, she has started approaching companies to rethink the way they partner with nonprofits.
When a store donates an item to an auction, they never know who ends up with the product, she said. It often is sold for a fraction of what it’s worth. The visibility is limited to those at the event.
With Generopolis, “companies can give on their own terms and circulate the listing on social media … it gives them credit. It’s positive social norming,” Winegrad said.
The Mellow Mushroom in Sunset Hills has come aboard to turn its pizzas into revenue generators for the Animal Protection Association. They are selling “skip the line” passes for patrons who don’t want to wait for a table. A “create your own pizza” coupon lets the buyer invent the next pizza special of the month, complete with weekly samples.
“It’s an alternative marketing format,” Winegrad said. “It’s about unique and customizable campaigns.”
Her Plan A for the startup involves squeaking by on savings and sales fees until Generopolis hits 30,000 users or $300,000 raised for nonprofits. That’s the indicator of when to expand and approach potential investors, she said.
“For now, we are building awareness of what the platform is and how to use it. You build a thing and eventually the business model will become clear.”