Scot Chisholm is one of the original founders of Classy, the highly successful San Diego social enterprise named after none other than “Anchorman”. Classy helps nonprofit organizations maximize their fundraising through its online tools targeted at a younger generation. So far, Classy has helped nonprofits raise $3 billion dollars in the last 10 years, and the company doesn’t anticipate slowing down anytime soon.
Classy was founded in 2011 after founders hosted a pub crawl to raise money for cancer research. Originally called Stay Classy, the company was mission-driven, focused on helping nonprofits raise funds in a rather unique way.
When Scot had originally visited the Tacos and Tech podcast back in 2018, the company was unknowingly in turmoil with a private equity firm. This was just the beginning of a long battle to separate the firm from Classy. Scot explained how hard it originally was to raise funds. For some reason, firms didn’t want to touch Classy. The majority of the startup’s investors were angels, but later larger venture capital firms like Salesforce Ventures and Hinge Capital bought in.
For a young, growing company, the private equity firm was not the right match. This resulted in the team buying out these Series C investors and bringing the partnership to an end. At this point, Scot and the team could have given up, and sold the business entirely. Instead, they proved that it was a phenomenal business, raising money through insider investments to prevent selling.
Shortly after, the team shifted from shareholder to stakeholder primacy, a model that elevates metrics other than revenue up to the board. Metrics utilized include the Net Promoter Score, Employee Net Promoter Score (Classy boasts over a 50), and Benefit Score. To become a certified benefit corporation, a company must receive a score over 80 – Classy sits at 115 for its focus on social and environmental impact.
Going into 2020, the team was feeling great, but the world stopped in March and donations ceased with it, thanks to the pandemic. However, the lull was short-lived as giving came back in a big way, with citizens of all income backgrounds giving to food banks, hospitals, and others who were particularly hit by the pandemic. With the turn of the social justice movement, Classy saw new donors who had never participated in donations prior.
Nonprofits who were not directly in line with COVID relief that traditionally focused on in-person events – opera houses, symphonies, ballet – had their revenue streams reduced to close to nothing. They were forced to pivot to online fundraising, taking part in what Scot calls ‘the Zoom effect of the fundraising world’. Before 2020, only 10% of giving was online, but the number has grown tremendously in recent months.
Classy is in the business of helping nonprofits raise funds. When organizations win, so does the team. With a modernized platform appealing to millennials, the company has been able to raise a whopping $3 billion for causes across the globe. Classy has also been raising funds – the company recently closed a Series D for $118 million.
Scot recently stepped down from his CEO role, putting Chris Himes, who has both nonprofit and for-profit experience at the helm. As an executive chair member, Scot will be working on company expansion, particularly with M&As. Pulling ideas from Atlassian’s M&A strategy, Scot plans to look at all of the friction points in Classy’ clients’ workflow to seek out the next opportunity.
Listen in to hear about how Classy defied all odds, coming out as one of San Diego’s most well-known social enterprises.
Scot’s Favorite Tacos:
Ortiz’s in Point Loma
Connect with Scot:
Keep up with Classy:
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