📱 Venmo and Cash App are disrupting charity


December 4, 2020

PLUS: Spotify’s genius marketing play.
December 4, 2020
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Warner Brothers announced it will be releasing all of its 2021 movies simultaneously in theaters and on the HBO Max streaming service.

Every single employee at The Hustle has been patiently waiting for a live version of Tom & Jerry, so we’d be lying if we said this wasn’t the best news we’ve heard in 2020.

The Big Idea
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Venmo and Cash App are disrupting the charity industry

Most of us just use Twitter for doomscrolling stress-free media consumption.

But Detroit millionaire Bill Pulte has a different use for the platform: giving away cash. He calls it “Twitter Philanthropy” and claims to have doled out $800k+ via Cash App to his 3m followers.

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Writing for OneZero, Caitlin Dewey says Pulte is part of a larger shift in the charity space that has seen payment apps facilitate direct giving.

The modern philanthropic movement started in the late 1800s

The first philanthropic organizations in the US were set up as a response to “economic panics, the Civil War, and recurring waves of European immigration,” Dewey writes.

This charity system was active through much of the 20th century but has come under scrutiny for wasteful spending and overhead.

In one case, ProPublica found, the American Red Cross raised $500m to rebuild Haiti after its 2010 earthquake — but built just 6 permanent homes.

Meanwhile, smaller nonprofits — largely community-based — are cash- crunched: 92% of the 900k nonprofits that filed IRS returns in 2016 had budgets <$1m. COVID has only shrunk these figures.

Technology is cutting out organizations entirely

Per Dewey, the average young adult household gives $443 to charity vs. $624 two generations ago (inflation-adjusted).

The rise of GoFundMe, Patreon, and Kickstarter has conditioned an entire generation to support direct giving — a much older form of charity.

Apps like Venmo, Cash App and Zelle remove all giving friction and have boomed during the pandemic. According to AppTopia, payment app downloads increased by +94% between March and October.

Dewey notes that while these downloads weren’t specifically for charity purposes, there was enough activity for an official #VenmoItForward campaign at the start of the pandemic.

Meanwhile, giveaways have been in Cash App’s DNA from the very start.

Charities are still rolling in the money, though

As much as $450B in 2019, according to the Giving USA Foundation.

And direct giving certainly comes with its own issues:

  • Scams are easier to perpetuate
  • Lack of access as 17% of US households don’t have payment apps
  • Online literacy is needed for successful crowdfunding

“If traditional nonprofits refuse to engage with direct giving… it will probably develop into a threat,” one charity exec tells Dewey.

For his part, Pulte is as active as ever; in addition to Cash App donations, he delivered 2k+ turkey and dinner meals over Thanksgiving.

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Snippets
  • Lawyer up, Zuck: With Facebook already facing antitrust heat, the Department of Justice (DOJ) is suing the social media giant for discriminating against US workers (specifically, by withholding 2.6k jobs for temporary visa holders).
  • Ever wanted to be a bank? Well, fintech firm Stripe just released a banking-as-a-service product (Stripe Treasury) that allows its users to create bank accounts for their customers. It’s invite-only right now but does have one big user of note: Shopify.
  • Pod save us: Amazon wants to expand its library of provocative-sounding audio shows, so it’s in talks to buy podcast network Wondery — home of Dr. Death and Dying For Sex — for $300m.
  • Microsoft Office 365 released a dystopian-sounding tool called “Productivity Score” in October. Turns out employees don’t like granular level monitoring (e.g., how many emails sent today) and Microsoft has anonymized the data.
  • At the height of Uber-mania in 2016, the ridesharing service watched Back 2 The Future Part II one too many times and decided a flying taxi business was a good idea. Looking to dump non-core assets, Uber just unloaded the business to Joby Aviation.
  • Get that Moon Money: “NASA selects four companies for moon material collection,” per TechCrunch. In an absolutely shocking development, Uber is not one of the companies.
  • Some geniuses in Canada (there are lots) just created a conversion kit to turn your regular bike into a snowbike.
  • Ted Lasso is the feel-good TV event of 2020. If you’re a fan, see how the show’s writers make you love the main character in only 157 seconds.
 
Watch Me
watch

How Hodinkee turned a blog about watches into a $100m powerhouse

During the financial crisis of 2008, a banker by the name of Benjamin Clymer took a severance package from his employer and went to study at the Columbia School of Journalism.

While there, he started a watch blog.

Looking to take the piss out of the pretentious watch industry, Clymer ran the word “wristwatch” through Google Translate in an effort to find a whimsical name.

It spat out the Czech/Slovak word “hodinky” and Clymer named his nascent media venture HODINKEE.

Now, that blog is a $100m watch media + commerce empire

Per the Wall Street Journal, the company just raised a $40m funding round, led by the likes of The Chernin Group (which backs Barstool Sports), musician John Mayer, and Tom “I have more rings than fingers on my hand” Brady.

Clymer tells the WSJ that HODINKEE — which had 1.3m site visitors in October — is on track for revenue of $25m this year.

The majority of sales comes from its ecommerce watch business that was launched in 2012.

Not just for celebrities

The son of 2 teachers, Clymer built the business from the angle of a hobbyist rather than a 0.1%-er.

He tells WSJ, “I don’t come from a luxury world at all” and believes HODINKEE’s “middle-class mindset” is key to its success.

As part of the investment, Clymer — who has been dubbed the “watch Whisperer” — will cede the CEO role but stay involved day-to-day.

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List Mania
Spongebob gif

Spotify’s genius marketing play

Like the crisp winter air and obnoxiously early evenings, Spotify’s “year-in-review” Wrapped marketing campaign is upon us.

The annual tradition gives the app’s 144m users (sometimes embarrassing) data on their most-played songs, artists, and podcasts, and encourages them to share it with the public.

Created for virality

On Medium, the designer Dheeraj Nanduri broke down the UX elements of Spotify’s Wrapped that are engineered to maximize sharing:

  • Beautiful animation and data visualization: Telling stories through numbers.
  • Easy share buttons: From both the mobile and desktop apps, to all the social networks.
  • Eye-catching colors: Bright neon-ish colors “used to convey excess, fun, and frivolity.”

We’ve been sharing ours like hotcakes in The Hustle’s Slack channel.

Through the grapevine, we also got our grubby little hands on the Spotify Wrapped list of Salesforce CEO Marc Benioff, who recently acquired Slack for $28B.

Looks like the big man has been eyeing the deal for quite a while!

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Ad of the Day
Breguet ad

Breguet is a French luxury watch brand that was founded in 1775. As a result of its centuries-old heritage, the company gets to name drop like nobody’s business.

In this watch advertisement, Breguet writes “Napoleon Bonaparte, from 1798, a client of Breguet.”

As it turns out, Napoleon carried a Breguet pocket watch at the fateful 1815 Battle of Waterloo.

So — while this is certainly some great social proof for the luxury brand — we’d personally look for other time pieces if you plan on successfully re-conquering Europe.

Shower Thoughts

  1. As a kid, magic tricks are amazing because we think there is magic. As an adult, magics tricks are amazing because we know there is no magic.
  2. Humanity is constantly doing a stadium style “wave” waking up working and going to sleep around the planet at all times.
  3. Shopping for a new laptop on your old laptop feels like making your assistant hire their own replacement.
  4. Every pleasure is a guilty pleasure if you’re anxious enough.
  5. Gummy worms have more bones in them than actual worms.
via Reddit
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Today’s email was brought to you by @TrungTPhan.
Editing by: Zachary “What’s your $Cashtag” Crockett, Ike Arumba (Desi Arnaz Biographer).

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