Companies pitch new fundraising schemes to cash-strapped schools
Forget chocolate bars and flowers, companies are developing new fundraising models for schools
The press release was written with a healthy dose of chutzpah. “A former school principal has created a booming business that is sweeping the country,” raved the publicist, “and helping tens of thousands of schools raise money in a smart and modern way.”
Another new business aimed at helping schools raise money?
It caught my attention, because we’ve seen pitches on Dragons’ Den this season and last selling the same thing: better fundraising strategies for cash-strapped schools. I found myself wondering whether there’s a sudden new influx of competitors into this already crowded industry.
Kids (and parents) all over Canada sell millions of dollars worth of chocolate and magazine subscriptions and raffle tickets every year. (Gourmet-scented pencils called ‘Smencils’ are also allegedly popular.)
It’s big business, all right. Just in Ontario, for example, parents raised half a BILLION dollars in 2013.
That’s according to People for Education, a non-profit organization that promotes public education. More than 1,000 schools participated in a survey it conducted last year, and although some of that money was raised for donations to outside charities, the majority was spent in schools.
“I think there is an increased assumption among the parents that they must raise money, and they must raise more every year,” she tells me in a phone interview. “Fundraising used to be seen as something needed for extras - team shirts, or a special event. Now the question we ask is, ‘What is an extra?’”
Good point. With so many schools having to eliminate music, drama and sports programs in order to stay within their budgets, what used to be considered a standard part of an education just isn’t anymore.
As it turned out, the press release that sparked my interest was promoting an American venture. Schoola is based in San Francisco. It collects gently used clothing and sells it online, donating 40 per cent back to the school. The program, it says, is an alternative to the “silly” fundraisers many schools use to try and fill the gap left by “massive” budget cuts.
I decided to check in with the similar companies that had come to the Den to pitch for investment, to see why they’ve decided this is a good business to get into. After all, even Kevin O’Leary, arguably the most profit-hungry Dragon on the panel, commented during one of those pitches, “the DNA of a school is not to provide commerce.”
Wealthy School Revolution is the brainchild of Sarah and Darryl Davis of West Vancouver. I spoke to Darryl and he told me the company has been growing quickly, with operations in 300 schools across B.C., Alberta, Ontario and Nova Scotia.
“Funding shortfalls are continuing and getting greater, ” he says. “So it’s partly parent-driven. Parents believe their child needs everything possible to have a greater future.”
Wealthy School Revolution offers a program where families and neighbours can buy staples - dry goods, health and beauty products, and school supplies - and share the profit with the school, along with Davis’ company. Customers shop and order online, so it’s the retailer’s cut of the sale price that these new players are sharing.
Davis says he believes part of his company’s success is because parents aren’t asked to buy items they don’t need. As he explained in his pitch to the Dragons, the “constant bombardment” of requests to buy chocolates, or poinsettias, or gift cards, or coupons, is unwanted. Those are “products parents don’t need and quite honestly, don’t have the money to spend anymore,” suggested Davis in the Den.
“I said to myself ‘what do people need, and what is green, and what saves money?’” says Shanks. Her answer: toilet paper!
She says her company, eCause, has negotiated exclusive rights to fundraise with paper made by Cascades, a company she calls “the greenest paper manufacturer in Canada.” She’s also selling paper towels, but it was the discount toilet paper (48 rolls for $35) that made for some fun in the Den. The pitch goes to air Feb. 26.
“It’s a triple win. Everybody loves green, but not everybody can afford green.”
As a parent myself, and as someone who reports on the state of the economy, I like the idea that these entrepreneurs have made a point to not foist unnecessary expenditures on people. But public education booster Annie Kidder thinks the whole premise of fundraising for education is problematic.
“The mindset you end up with is that public education is a charity which will rely on the generosity of individuals or large corporate donors,” she says. “Public education in Canada is different from many countries in the world because 95 per cent of kids go to public schools and in the past, that hasn’t been seen as a charity that needs to be augmented.”
Furthermore, her group’s survey revealed that fundraising exacerbates the inequality between different schools. The top 10 per cent of fundraising schools are able to collect more money than the bottom 81 per cent combined. High income elementary schools fundraise at five times the rate of low income schools.
“So the less advantaged students have a double disadvantage,” Kidder points out. “They come from homes where they can’t afford the piano lessons, the trips to museums, or belonging to sporting clubs, and then they go to schools where the parents can’t afford to fundraise either.”
She doesn’t think badly of people like Davis in Vancouver or Shanks in Montreal for jumping on the bandwagon - “they see a market” as she put it - but Kidder does want Canadians to be careful of what she describes as a slow slide into believing public education needs to be funded by parents, or privately.
Meanwhile, the influx of businesses continues.
“We’re starting to get copycats,” says Davis of Wealthy School Revolution. “Not of the size and scope that we’re at, but it’s starting to become an interesting competition.”