GiveSignup Investment

Q&A: RunSignup Raises $2.6 Million in Series A Funding from Payroc for Strategic Initiatives

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RunSignup, Inc. is pleased to announce that an investment affiliate of Payroc will become a minority investor and the Company will begin using Payroc as a preferred payment processing platform.

Payroc is making a minority investment in the RunSignup|GiveSignup business to help fund the continued rapid expansion of the RunSignup customer base and provide additional fundraising capabilities to the nonprofit market with GiveSignup.

You can read the full press release here, but we’ll start by answering a few questions that may arise.

Wow! That’s a lot of money. Did they buy you?

While it is a lot of money, they will own less than 10% of the shares of the company. The rest is still owned by our employees, including myself.  Payroc will get what is called board observer rights, but they do not get a voting board seat.  I remain the CEO and plan on being here for a couple more decades.

Why did we take outside investment?

There are three major reasons:

  1. During these tough times, we wanted to make sure we had plenty of cash in the bank to service our customers and pay our employees.
  2. We are seeing a huge increase in new customers and new events, and want to make sure we have the resources to meet their needs.
  3. Serving nonprofits with GiveSignup is a very large opportunity. Many of the new customers coming to us are nonprofits and we want to ensure we are not diluting our endurance investments to continue to build out our GiveSignup offerings.

What will change for me? 

Over time, better technology. Other than that, not much. Our team support and account management teams remain the same, and our development team continues to iterate and improve our solution for races and nonprofits.

Will you be spending any of the money?

Yes, we do plan on hiring a few people, in addition to the 3 new GiveSignup reps hired recently. Most hiring will be in development, but we might need some more support people if the high volume of new customers continues.

Is this an investment in RunSignup or GiveSignup? How do you balance the two?

Well, an investment in one is actually an investment in both!  

A little secret – it is the same software.  It is all a single database platform, and all the transactions and payments are done together. 

On the RunSignup side, we have been focused on technology for endurance events for the last ten years. We believe that our success has come from our leadership in technology and our purpose-built platform, and that’s where we’re keeping our focus. There is still a ton of technology to build and we will continue to focus on rapid development and features that respond to our customers’ needs.

When we look at GiveSignup, we have a lot of great technology that we can already offer nonprofits, with thousands of nonprofit customers using our run/walk/ride and new technology for virtual and challenge events currently. We are expanding nonprofit technology for ticket events like galas, golf outings and pancake breakfasts, and creating amazing fundraising tools like integrated Facebook Fundraising and specific virtual campaigns like Giving Tuesday.

As we build the new GiveSignup technology, we do not want to take away from our development roadmaps on the endurance side, and the investment helps us add to our development team to keep both products moving forward.

If you’re interested in learning more about the investment, our plans for the company, and our expectations for 2021-2022, you can find a longer Q&A on our blog.

Are you still employee-owned?

Yes. We are a majority employee-owned company, and our employees still have a personal stake in the company.

Wait, you said your customer base is expanding. How is that possible?

Like everyone, our transaction volume is down (but improving) this year. But if you look at our Monthly Report, there’s a more complicated picture. The current restrictions mean we’re seeing more small events, more fundraising events, and more races changing their registration platform.

Many of our new customers have joined us either because of our rapidly released solutions for virtual and challenge events, or because of a need for virtual fundraising options. Net new races were up 18% in August and the number of new customers per week up 20%. We are seeing a large increase in nonprofits using the platform, with donations up 63% in August.

Our support team has been doing a tremendous job on-boarding all the new customers, and we expect the size of their events to grow over the coming years as we come out of the pandemic.

How are you thinking about the next couple of years?

We think putting on live events, especially larger ones, will continue to be challenging, through all of 2021. We hope to be surprised, with vaccines widely distributed and participants feeling comfortable with larger numbers earlier than that.  However, there will be additional operational challenges and costs to put on events in 2021, and there will be some portion of the population who will not be comfortable.  We are hopeful that 2022 will be more “normal”, although the industry may not back to 100% of 2019 participation.

When we look at the endurance market, we are seeing most vendors moving backwards with staff reductions and difficulty paying customers on time. We have also opened up a substantial technology lead, becoming the clear choice for virtual and challenge events. Between migration of customers, and our expectation that some competitors may not make it, we are expecting our market share to grow from 25% to around 35%. If some larger vendors do not do well, our market share may grow even higher by 2022.

Where do you see RunSignup and GiveSignup going in the next 5-10 years?

We have a very clear goal of expanding our technology with the goal of helping our customers raise over $1 Billion per year. 

In 2019, we were at $270 Million with about a 25% market share in the endurance industry.

We think the endurance side will grow to 50% market share – which would make up about $500 Million.

With GiveSignup, we have an amazing opportunity to help the 8,000 nonprofits who currently use us for their runs, walks, and rides to raise more with our purpose-built ticketing platform and our low-cost donation and fundraising technology. There is a $30-50 Billion market for nonprofit online giving and event participation, so we feel like it’s reasonable to aim for $500 Million of transactions for nonprofits, with huge potential to grow even after we hit that incredible milestone.

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