After a week-long hiatus, our “Startup Sit Down” series is back with an interview of fellow GA member Adrian Sanders, the co-founder and CEO of The Good Karma Co. The first philanthropy startup we’ve featured, Good Karma is a company that aims to help make philanthropy a part of people’s everyday lives. Through partnerships with businesses, Good Karma rewards individuals with “Karma Points” for being customers – they can then go and donate these points to local non-profits as real-money donations. Adrian spoke to us about the philanthropy space, his odd introduction to entrepreneurship, and his company.
What exactly is Good Karma?
Basically, it’s a new way to contribute to non-profits just by living your daily life. We’re partnering with businesses to offer “karma points” to people for doing what they already do, like buy a coffee, go to a show, or whatever. Philanthropy is really broken – we want to fix it and we feel like the best way to do that is make it a part of people’s everyday lives. A dream scenario for me is that you wake up in the morning and go to the coffee shop and you check in, that’s twenty karma points; you go get pizza for lunch and check in, that’s another twenty karma points; you go out at night and check in to the club, that’s an4other twenty karma points; then you tweet at the club you’re in and that’s more points. By the end of the night you’ve racked up a hundred karma points that you can donate to the non-profit of your choice.
Where did the idea for your company come from?
One of my cofounders, Chris, came out to London where I was working, and he’s a super do-gooder, moral compass kind of guy – I’ve known him pretty much my whole life. We were always having these greater philosophical discussions about the choice between doing good and making money. We got inebriated one night, and really got into it. I said to him, “we’re just consultants, if you’re so passionate about doing good, then do something about it.” And he said, “yeah, but you say you want the challenge of making money in a meaningful way, so you should do something about it.” I said, “challenge accepted.” So the question came down to why some people give and others don’t. I don’t want to be guilted into giving and I feel like 90% if charities try to guilt me. Out of that discussion came the thought that you might not give to Salvation Army but you would give to your buddy’s charity. Is that because their project is better than Salvation Army’s? No, it’s because people feel disconnected from big charities. That’s the hard part – building relationships between normal people and the people who are doing good. We want to build a community that cares, and serve it in a platform that isn’t guilt driven or in your face. When you are feeling philanthropic you can hit this webpage – here is all this info for you.
How has the product changed from how you first envisioned it, what type of reassessments have you been forced to make?
The original idea was a carbon-trading thing – providing a fun game-layer interface for carbon trading. But we realized that carbon trading was actually fucked up and corrupt. Basically, between actual projects that are carbon trading certified and the businesses that supply them with money, there are middlemen that take a huge cut – sometimes up to 30%. With good karma, we pivoted to find a way that we could make money that doesn’t also take away from individual users philanthropic efforts. We want our profit to come from a value proposition. We want to get to a place where 100% of user contributions go directly to the non-profits. So we pivoted pretty hard away from carbon trading.
Can you tell us a little bit about your personal history with entrepreneurship?
In high school, I worked out a deal with my parents where instead of buying hot lunch at school, they would give me half of that cost and I could go to the supermarket and get better food for way cheaper. Once that started I wondered what would happen if I only used half of that money on lunch. So I started generating revenue that way. That was the moment when I realized that money and the valuation of things was not concrete. Then in college, I basically funded a lot of my life flipping hi-fi audio equipment. I’ve always been a big fan of working smarter not harder. Then I ended up in France after college with no money, I worked for a real estate agency for a while and then founded a business consultancy that is still alive – although it’s now New York based.
What are your daily responsibilities?
My main job as CEO is to kind of keep all the wheels spinning and make sure everybody is clear on the same vision. I help on the product, but my job is really to make sure we get money, make sure we are headed in the right direction, and that all sort of ephemeral parts of the business – like buzz, getting people excited, networking – are going well. I need to put my partners in touch with all the right people and that those guys get everything they need.
What are some things that are unique about founding a philanthropic startup?
I think the unique thing about it is that 20% of Americans give either time or money to philanthropic organizations, but there are 80% who could give but don’t. I think that there are a lot of people in the “social good” space who are really optimistic and are truly essential – they represent the best in us. That’s essential, but what’s unique in the philanthropic space is that there’s not enough ruthlessness and business savvy. There’s a belief, which I think is amazing but sometimes naïve, that if you give people the chance to do good and put it in their face they will just do it. The truth is that successful philanthropic organizations are tightly run marketing and business machines. I think that the unique challenge is to marry the ruthlessness of business with the goodness of philanthropy in a way that is true to both.
What do you feel is the best part of running a startup?
I just hate working for other people. That’s a personal thing – I’m too much of a smartass and don’t like being treated as an underling. Some people are ok with that, and are fine with somebody else handling the decisions. But the best thing about a startup is that it’s my own vision and when my partners and I sit down at a table to speak we are equals.
What do you feel is the worst part of running a startup?
There is the obvious financial uncertainty. The toughest part however, is that there are some days where you just with the path were clear and it’s not. There is nobody leading the way for you – mentors can only help you ask the right questions, they can’t give you the right answers. That problem still exists in a normal job, but its much more in your face as a founder.