By GREGORY ZELLER //
A Melville tech developer pursuing distinct nonprofit and commercial verticals has launched a $5 million crowdfunding campaign to help create its own cryptocurrency.
Digital Donations Inc. on Sept. 17 flipped the switch on its ambitious Crowdfunder.com equity effort, targeting what the company called “expanded development” of its proprietary cryptocurrency CoinGIV and its “digital wallet” PayGIV. Both services are designed to streamline charitable giving opportunities.
It’s a return to form, somewhat, for the tech startup, which was launched in 2014 by cofounder and President Keith Orlean to provide “alternative fundraising solutions” for nonprofit organizations. Earlier this month, Orlean announced that in addition to those nonprofit solutions, Digital Donations would provide data-modeling and other technical services to help for-profit commercial enterprises better connect with their audiences.
But CoinGIV and PayGIV – and the crowdfunding campaign, which as of 5 p.m. Sept. 26 had $500,000 in Crowdfunder.com reservations, what Orlean called “previous investments” – are callbacks to the company’s original nonprofit doctrine.
The idea, according to Orlean, is to leverage the current cryptocurrency craze into a new-and-improved retail-transaction platform with built-in charitable-giving options.
“Cryptocurrency is obviously very hot,” he told Innovate LI. “We’re trying to add to that by factoring in fundraising.”
Like other cryptocurrency creators, Orlean is banking on the idea that his virtual money will catch on and appreciate in value – as has happened with Bitcoin and other cryptocurrencies, which now go live with “ICOs” (the “coin”-operated version of an IPO) and attract speculating day-traders much the way gold and other commodities do.
Once CoinGIV is developed and deployed and has found its sea legs with retailers and consumers, users will be able to donate a portion of their cryptocurrency’s appreciating value – or even a chunk of their CoinGIV principal – to the charities of their choosing.
“It’s all predetermined,” Orlean noted. “I can choose to donate a percentage of the appreciation or the full principal to whatever charity I want.
“So, I just bought $1,000 in cryptocurrency – what percentage of the appreciation do I want to donate to charity?”
While it might sound like a convoluted way to make charitable contributions, Digital Donations is factoring in the increasingly mainstreamed use of cryptocurrencies in everyday society. “Cryptocurrency is here to stay,” according to Orlean, one of the reasons he’s targeting his startup’s GIV programs primarily on millennials.
For instance, when soliciting businesses it hopes will become early adopters of the CoinGIV cryptocurrency, Digital Donations is concentrating first on product and service providers likely to be popular with those born during the last two decades of the 20th century.
“We will look for companies that are also targeting millennials,” Orlean noted. “That’s what we would consider a good match.”
There’s “no way to predict” how CoinGIV will perform, he added, but the hope is that the cryptocurrency takes off – meaning speculators buy in, appreciation rises and the charities linked to Digital Donations’ platforms reap the swelling benefits.
“It’s basic supply-and-demand,” Orlean said. “You start with a little interest, and if you’re lucky enough, it takes on a viral component.”
The Crowdfunder.com campaign also serves to drum up a little buzz prior to Digital Donations’ public debut. The company, which has received preliminary Securities and Exchange Commission approvals, is currently awaiting a ticker symbol and hopes to begin trading over-the-counter before the holiday season, though that’s starting to look like a best-case scenario, Orlean noted, lamenting the SEC’s slow approvals pace.
If Digital Donations doesn’t have its ticker symbol before November, it will put off its IPO until January, the president added.
“Nobody wants to pay attention at Thanksgiving and Christmas,” Orlean said. “So, it’s just a waiting game.”