The following is a conversation between Ben Erwin, President of Charitybuzz, and Denver Frederick, the Host of The Business of Giving.

Ben Erwin, President of Charitybuzz

Denver: Many listeners who have attended charity galas are familiar with the auction part of the evening as the organization raises additional revenue from those in attendance. But what happens when there are no in-person galas? No two tickets to a live sporting event? No meet-and-greets with a very special person? No travel to an exotic location? And what if that happens at a time when many nonprofits are struggling to meet increased demand for their services? Well, to find out, it’s a pleasure to have with us Ben Erwin, the president of the full-service charity auction site, Charitybuzz

Welcome back to The Business of Giving, Ben!

Ben: Thanks, Denver! Appreciate you having me back on the show. I’m excited to talk to you about everything and anything that’s transpired over the last year. It’s been a crazy one.

Denver: That’s great. Well, in some ways, Charitybuzz was prepared for a time like the one we’re in. Tell us a little bit about the company and what you do.

Ben: Charitybuzz is the leading online charity auction site. So, in a nutshell, we provide people with the chance to live out their wildest dreams while supporting tremendous causes. 

So, to the customer, it’s a marketplace filled with unique experiences, exclusive access, high-end merchandise, collectibles, incredible exotic travel and getaways. And every time somebody bids and wins, money gets remitted to terrific charitable organizations. 

And on the charity side, it’s a platform where they’re able to significantly increase their reach, leverage their supporters in new and exciting ways, and uncover a considerable and complementary new revenue stream of unrestricted funds.

It was really important for us just to call our charity partners up and have a conversation with them and let them know: We’re here. We don’t know exactly how we’re going to support you at this moment, but we’re dedicated; we’re not going to stop, and together, we’re going to figure out a way to do it. And that was really the mantra of 2020 for Charitybuzz.

Denver: Since the pandemic and lockdown started last March, Ben, how has what you do fundamentally changed? 

Ben: It’s a really good question. And you alluded to the fact that we’re a digital marketplace; it certainly helped us weather the storm of 2020, but the majority of what we sell are intimate, personal experiences surrounding large-scale events.

So back in the middle of March, essentially 75%, 80% of our inventory immediately became non-viable. So, we quickly had to do some damage control. We had to remove quite a bit of inventory from the site. We had to reach out to thousands of customers who were in the midst of redeeming these experiences, and postpone them and talk through what the recourse was. And then we kind of had to pick ourselves up and figure out: How are we going to survive, flourish, and keep supporting our charity partners? And what was really important to us was to try to form a perspective and a narrative of what we thought the next three-, six-, twelve months were going to look like. 

Now, at that point, it was anybody’s guess. Every single news channel was probably telling you something different. But we’ve tried to do it through the eyes of the consumer: What was consumer behavior going to look like? So we knew people are going to be stuck at home for the foreseeable future, so what does that consumer need? What do they look for? So, we created a few different buckets. 

The first one was what stuff that they can do right now, what stuff that can entertain them, put a smile on their face while they are quarantined and stuck at home. And for us, that was moving a lot of our physical experiences — meet-and-greets, lunches, pitch sessions, et cetera — to just virtual. So these were still available. The celebrities, business people, personalities had some time on their hands. These things can be redeemed pretty quickly since there’s no travel involved. And those became really, really successful early on. 

We really pivoted into collectibles. So the insight there was nice, shiny things typically make people happy. As materialistic as that sounds, it’s true. So, a lot of memorabilia, mostly music, entertainment, sports, high-end wine and spirits. That’s another thing people really gravitate towards during difficult times.

And then the last was giving people something to look forward to. That’s a really powerful coping mechanism. So travel that was redeemable in 2021 and beyond, events that at that point we thought would be happening in 2021. So we created some light at the end of the tunnel for our consumers.

And then once we developed this framework of what we thought we could have some demand built for, we then brought all of that to our charity partners, and that was the most powerful conversation of all because — you mentioned it in your intro — charitable organizations were crushed last year. When financial markets go down, people stop giving their money away. 

But what happened was that people who were starting to give money away were giving money very specifically to organizations supporting frontline workers and COVID, social justice, and food banks, which was awesome and worthwhile. But that left all the other charities feeling like, “How are we going to make ends meet? We have no live events. All of our traditional fundraising streams are drying up.” 

So, it was really important for us just to call our charity partners up and have a conversation with them and let them know: We’re here. We don’t know exactly how we’re going to support you at this moment, but we’re dedicated; we’re not going to stop, and together, we’re going to figure out a way to do it. And that was really the mantra of 2020 for Charitybuzz. 

Denver: And a lot of this revenue you generate for these charities is unrestricted revenue, and that is the thing that these organizations desperately need. Correct? 

Ben: Yes. Absolutely. Whenever we talk to a charitable prospect about Charitybuzz, you use those two words and eyes light up, and the deal gets closed. Because as fundraising dollars start to dry up, unrestricted dollars, probably dry up at a rate of 10X, and they need to be able to receive money and direct it to the places they believe it needs to go, versus having things earmarked.

What we’ve found so far, these virtual experiences are exceeding expectations because the conversation is more deliberate and focused… Both participants are using the comfort of their own home, and that leads to more authentic and intentional conversation.

Denver: Tell me a little bit about the meet-and-greet. And I guess in that context, I’m asking this: one, what would you say, even informally, the customer satisfaction would be between actually meeting somebody in person and having a virtual meet-and-greet with that individual over Zoom or Teams or something of that nature?; and secondly, how does the bidding go? Are they comparable in terms of virtual versus in-person, or is there a real difference? 

Ben: So we’re really particular about setting expectations upfront on the website. That’s a big difference between us and probably what happens during the excitement of a live auction at a charity gala. We formalize the entire process so people know: Is this going to be 5 minutes, 15 minutes, 30 minutes? How many people are allowed to be on it? What’s the nature of this experience? 

And what we’ve found so far, these virtual experiences are exceeding expectations because the conversation is more deliberate and focused. You’re not backstage at a concert or on the red carpet of a movie premiere or, on the court after a basketball game. Both participants are using the comfort of their own home, and that leads to more authentic and intentional conversation. So we’ve heard a lot of really good, really, really powerful feedback, not just from the winner, but from the celebrity. They’re really liking it because they get to meet interesting people as well.

And in terms of the dollars being raised, it’s not the same. There’s a whole difference between meeting someone over Zoom and being able to shake their hand and look them in the eyes, but there’s been some surprises. But what’s been really interesting is, and this is what I think is the lesson, at least I’ve learned is, having that clear focus early on with understanding consumer behavior, it made us very, very clear and committed to what we’re going to do, and that unlocked and uncovered some really interesting new opportunities. 

And the biggest one is, we are now selling for insane amounts of money, the chance for a celebrity and influencer to follow you on social media. So I’ll give you an example. Back in, I think it was October or maybe September, every morning, I wake up and I look to see what’s closing on the site, what our bidding looks like… it’s part of my routine, and I saw we had Mark Cuban will follow you on Instagram, and it was at $5,000, and I thought it was an error.

So first, I reached out to everyone. I said, “Is this right? This can’t be right. $5,000 to follow you on Instagram?” And then when I found out it was real, I got really excited. We could build a whole business. Talk about the easiest thing for somebody to donate — press a button on your phone and it’s redeemed. That sold for $30,000 that day. 

Denver: My goodness.

Ben: That’s how much the bidding jumped. And we have since raised over a half a million dollars for charities through this, which was another example of us going to our charity partners and saying, “Look what we just uncovered. You can now go to your celebrity supporters who are probably fatigued with all the asks, and you can ask them for what is now the easiest possible thing to donate. And we’ve created a demand in the marketplace where people will pay pretty insane amounts of money for something which is so easy to facilitate.” 

So, I think the power of Charitybuzz is we are a platform that can help organizations raise top dollar regardless of what’s going on because we’re creating access; we’re creating a marketplace, and that’s why it’s a really important tool in a fundraiser’s toolkit for how they’re able to drive as much impact as possible.

Denver: Genius. That really is. 

Ben, tell us about some of the auctions that have gone on to help support some of those frontline organizations, whether they be the health workers, whether they be those people providing food to people who’ve been particularly hard hit, social justice, things that have happened this past year… those auctions, and some of examples from those.

Ben: One of the things that I’m most proud of, looking back on 2020, was our ability to raise money for charities across the spectrum. 

So, what you typically see when something as catastrophic as a pandemic or a natural disaster happens is everybody — the media, for-profit companies, the general public — gravitate towards a single cause. And the issue in those situations is that money is then taken away from all of these other causes that I believe are just as important. Because when you think about cause, it’s such a personal choice. The charities that I personally support might be very different than the ones you support, but that’s because they’re shaped around our own life experiences, loved ones…who knows.

So we were able to support quite a bit of organizations around hunger. We work with a great organization called WhyHunger out of New York who supports food banks all over, and they had their biggest year with us. But just as impressive was our ability to help the organization that felt like nobody cared about their cause because everybody was focused, and rightfully so, on COVID, on social justice. 

So my hope is, as a result of 2020, when things like this happen, when things get bad, everybody’s capacity to care increases. So you continue to support the cancer organization, the environmental organization, the human rights organization, and then on top of it, you support the organizations that need the money right now… like combine the causes that you were steadfast in your support with the tip-of-the-spear type causes that are affected by real-world events and need that money constantly. 

So, I think the power of Charitybuzz is we are a platform that can help organizations raise top dollar regardless of what’s going on because we’re creating access; we’re creating a marketplace, and that’s why it’s a really important tool in a fundraiser’s toolkit for how they’re able to drive as much impact as possible.

Denver: You guys have raised hundreds of millions of dollars for thousands and thousands of organizations over the past few years. How did last year compare to the year earlier, month to month? Was 2020 and into 2021 good, relatively speaking, or not quite as good as it had been previously?

Ben: 2020 was our best year ever.

Denver: That’s so interesting. 

Ben: We, like any business as I mentioned, March, April, May, we took a little bit of a hit, but we got up off the mat very quickly, and it’s all thanks to the team. I get to have these conversations, which I’m grateful for, but it’s all because we’ve got the most dedicated, passionate group of people at Charitybuzz… that they probably didn’t get enough sleep in 2020, but that was because they knew what was at stake for these organizations that we work with, and then they also knew how committed we had to be to our customers. We have a couple of hundred thousand people who are part of our user base, who continuously are supporting these charities through Charitybuzz auctions, even given what’s going on. So it’s a really big responsibility we hold, but it’s something we take very seriously. 

Denver: Let me ask you a little bit about galas. I know you do things well beyond just the classic charity fundraising gala, but we know there’ve been a lot of virtual galas as well. Have you been a part of any of those, and have there been any of these galas that have particularly caught your attention in terms of being creative and innovative in terms of the way they’ve gone about doing it? 

Ben: It’s a really good question. So we typically don’t have much involvement with galas, whether they’re live or virtual. In some cases, our auctions are run in connection with them, and they typically bookmark the gala. So say they launch about a week before and close a week after, and then the organization uses the gala as a promotional tool to drive attendees. 

What I’ve found is when this first happened, you saw a lot of organizations try to take their live gala, their run of show, and just move it virtually without any changes. And that doesn’t work. You don’t have three-and-a-half hours. So short– hour max– really, really quick, really impactful, punchy run of show has been really terrific. It’s basically them getting to the good stuff really quickly. 

So a gala that I attended at the end of the year was for RFK Human Rights, and it’s their Ripple of Hope Award. So they give an award in the spirit of Bobby Kennedy to incredible human rights defenders; Colin Kaepernick and Dr. Fauci were two of the recipients this year. So when you attend a live gala, the program is great, but you kind of want to see these amazing luminaries speak. And with this one, they started with one with Kaepernick, and then they spliced them throughout the hour run of show. So throughout the whole thing, you were just inspired, you were excited; you kind of paid more attention to the rest of the program because you were engaged, and your eyes couldn’t leave the screen. 

And that’s an interesting strategy to maybe bring back to the live gala where you don’t have to… everything doesn’t have to wait until the end when everyone is not paying as much attention and has been sitting down for a few hours. Maybe you bring it on throughout the entire two- to three hours and that will keep people glued to the stage and leave them feeling good and learning more about the work the organization does. 

Denver: And getting to bed at a decent hour, which I think we would all appreciate. But that really goes across everything, whether it be our staff meetings, our board meetings, or our galas, you can accomplish everything you want to accomplish in about half the time. That seems to be a pretty much universal takeaway. The question, as you posed a moment ago, will that happen? Or would it tend to revert to form in the way it once was? And I guess we’ll find out. 

Ben: I sure hope the former happens. One of the pseudo goals for Charitybuzz in 2021 is to have meetings end early. I think it’s what you said  — it’s efficiency. You could probably get a 30-minute meeting done in 10 minutes. So have the agenda, get through the salient points, and then end the meeting. There’s no need to spend all this other time, especially as everyone’s working from home. Zoom fatigue is a real thing, and there’s ways to combat it. And if we can then use that take- away when we return to some semblance of normalcy… hopefully later in the year, then that’s a positive takeaway from everything that’s happened. 

And at this point, that’s what I’m looking for is. What has transpired and has continued to happen around the world is terrible, and we need to continue to figure out how to get vaccines out and get everyone support, especially the most hard-hit areas. But there are some things that we’ve learned, and there’s some dynamics at play here that have transpired during the past year… that if we leverage moving forward, we could say, “Oh, here’s a positive takeaway from what happened over the past year,” and that’s what it’s all about. 

Denver: Nothing wrong with looking for silver linings in the middle of a tragedy like this. You know, picking up on what you just said there, when we do find a return to a semblance of normal, whenever that might be, what new practices or innovations, in addition to perhaps following somebody on Instagram, will you think you’ll take from this period of time which will really stick as a part of your business going forward?

Ben: I think there’s a few. So, one of the things that we’ve really been focused on in the past, let’s say, six to nine months is we’re essentially no longer a charity fundraising site. That’s our purpose and that’s what we do, but we’re an e-commerce company. And when we positioned ourselves in the e-commerce market, it gets more interesting, it’s a bigger market, and there’s ways for us to scale.

 Our vision is to become the world’s leading impact marketplace. So today, that’s auctions. We did launch a store at the end of last year, so now there’s the functionality on the site just to buy really, really cool stuff…experiences at the click of a button.

Denver: Interesting.

Ben: A lot of the verticals that I mentioned, whether it was virtual, collectibles, wine and spirits, those are things we largely didn’t do before the pandemic. Those are things we will continue to do for the foreseeable future. And then when the tsunami of demand comes back for experiences, when the world returns to normal, that’s just going to come in on top of the business that we built throughout the pandemic. And that represents a massive opportunity for Charitybuzz and one that we’re all really focused on capitalizing. 

And then the last one is: it’s changing the way online auctions work. And the best way to explain that is if you think about online auctions since they first made it onto the scene, they haven’t really changed. Bid boxes are different colors, design, but it’s really:  press a button, bid. You get outbid, you go back in. But if auctions are supposed to emulate the energy and the success of a live auction, they’re missing one very key component and that’s an auctioneer. And as you know, Denver, a great auctioneer can increase the amount of money raised in a room by 2-, 5-, 10X. I mean, they are just superstars out there. 

Denver: No question about it.

Ben: They’re salespeople. They’re telling you, “You need to buy this. Picture yourself doing this amazing thing, and this is who it’s going to support.” So we’re going to be launching a pretty awesome live stream product on the site where we’re going to bring the live auction and auctioneer to the online format so that we can really start delivering that content at scale and having the key components of a successful auction live in an online world.

Denver: That’s great. Sometimes when you talk about an idea like that, and you look at it, you say, “What a DUH! moment that is.” You know what I mean? It’s like, “How did we miss that?” Because you’re absolutely right. I’ve been to so many auctions in my time in events, it makes double to 10 times the difference if you have the right person up there really motivating people and elevating people and actually making it fun, you know?

Ben: Yes. Exactly.  It’s the dynamic of: you’re at a gala and there’s 500 people in the room, and it’s probably 10- to 15 people are actually doing the bidding at the high end, but everyone in the ballroom has their eyes fixated on the stage, to the auctioneer. 

So then what does the auctioneer do after the auction is over? They ask everyone to donate small amounts of money. They do a paddle race because they’ve created the…now, everybody wants to participate. They can’t participate at $25-, $50-, $100,000. But $100, $500? They’re compelled. They’re inspired. That’s a powerful thing that we’re going to leverage on Charitybuzz in 2021.

I make everyone feel like they are an active member of the leadership team. They know how we’re doing financially. They know what our growth targets are. There’s very little that we keep from the team, and that’s, I think, also allowed the morale to be better. And for me as a leader, it’s helped me effectively and competently lead from afar.

Denver: That is great because…. you’re absolutely right. Creating energy. That is what you need, and that energy can really change things. 

And it’s also interesting in terms of being an e-commerce company. I was actually talking to a charity the other day, and they were telling me they’re no longer going to consider themselves as a charity. They’re going to consider themselves as a tech company. And I’m seeing more and more of that, that people are realizing that if you do not put tech at the core of your operation, you are never really going to be able to impact the cause that you’ve been interested in impacting. If you’re going to be doing it in a very incremental way, you’re never going to be able to scale. So there are going to be some profound differences that are going to come out of this. 

Let me close with this because I wanted to get back to your team a little bit. And I’d just like to know how you think your culture and the operation of Charitybuzz is going to change as a result of all this. And to you personally, Ben, how do you think your leadership is changing and will change going forward? 

Ben: So this has done wonders for the culture of the organization, which if you asked me in March “Was that going to be the effect?” I would have probably said no if I was honest. So it’s been amazing I think for the team to see that when they all work together, we can overcome anything and everything. So to have a really big year, given everything, and the deck stacked against us?  It’s really a proud moment for everyone on the team. 

The power of our culture can best be described in… I’m very proud that we had one of our biggest years. I’m proud of all the great impact that we deliver to charities, the innovation. But the thing I’m most proud about is we were a support system for each other. A lot of the people that work at Charitybuzz, they live in New York; a lot of them live alone. So during the first few months of this, it was a tough time. But they had their team; they had their family at Charitybuzz. And it was more than just work. It was having happy hours talking through how everyone was feeling, and it made the entire experience easier for everyone. And that’s the power of a good team and really great culture, and I believe that’s going to continue. 

Momentum is something that once you have it, you need to keep investing in it. But we’re lucky that what we do, I don’t need to try to connect the dots to people about how their work drives purpose and positive change. It’s inherently in our business, so we’re pretty lucky in that regard. But reminding them, every week we have a staff meeting all hands, we go through testimonials from our charities and our customers about: What did this do to these people?  So everyone just remembers, when you work really hard, there is a real, tangible effect, and it’s people, it’s places and it’s organizations. 

And then for myself, being remote has required my leadership to be more transparent. So I share a lot more. I share a lot more visually, through presentations, and I make everyone feel like they are an active member of the leadership team. They know how we’re doing financially. They know what our growth targets are. There’s very little that we keep from the team, and that’s, I think, also allowed the morale to be better. And for me as a leader, it’s helped me effectively and competently lead from afar.

And as I was telling you before we jumped on the interview, Denver, I never worked from home before, and I did not like anyone on my team working from home prior to all of this. So I was forced into a remote working situation, and it’s been incredible. We haven’t skipped a beat. If anything, we’ve put on the gas down even further. So that has a lot of, I think, enduring qualities for everyone and will make people remember how powerful we can be when we just work together and have a shared vision. 

Denver: And as you said about transparency, when everybody in the organization knows everything about what’s going on, then every single person is a problem solver, and you get better, better outputs as far as that is concerned.

Tell us about your website, Ben, maybe some of the things that visitors will find there, and also how they can get in touch with Charitybuzz if they’re thinking about their organization, trying to start an auction. 

Ben: So Check it out. There’s a lot of really fun initiatives on the site right now. Our big promotional campaign right now is Valentine’s Day, so there’s an amazing array of experiences, items to give to your loved one or to share with your loved one around Valentine’s Day, and we’ll really start picking up even more as we get into February and March. 

And there’s some really, really exciting things coming down that I’m not at liberty to say, but the easiest way to stay in touch is go to Charitybuzz, submit your email, and then you’ll get all of our promotional emails so that you’ll stay up to speed on everything that’s coming down the pike on the website.

E-mail [email protected]. Anyone and everyone who’s interested, who just wants to learn more, you’ll get a response probably within two hours if it’s a weekday from the wonderful business development team who really just works with our partners to identify how they can work with us. Typically, the conversation starts in one place. That might not be the right direction, but we’re really good at identifying other things for people to explore; light bulbs go off, and we’re able to raise a lot of money for a lot of really great organizations.

Denver: Fantastic. Well, thanks so much for being here today, Ben. It’s always such a pleasure to speak with you!

Ben: Thanks, Denver! You, too, my man.

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