The online fundraising giant GoFundMe says it will acquire Classy, a nonprofit fundraising software company.
“The addition of Classy accelerates opportunities to service the nearly $500 billion U.S. philanthropic market as GoFundMe aims to be the most helpful place in the world,” the company said in a news release Thursday (Jan. 13).
The all-equity deal was inked Jan. 6 and is expected to close in the first quarter. Last year, Classy’s platform oversaw $1.1 billion in donations, bringing the site’s all-time donations to close to $4.4 billion.
GoFundMe says its acquisition will create opportunities to reach more people and organizations and give donors a chance to find new causes to support.
“GoFundMe’s vision is to be the most helpful place in the world and partnering with Classy enables us to do that in a differentiated way,” said GoFundMe CEO Tim Cadogan. “$5 billion in donations was raised on the GoFundMe and Classy platforms in 2021 — together, we can create a uniquely powerful network that connects donors on GoFundMe to nonprofits who use Classy.”
The company says this acquisition is the latest in a string of milestones for GoFundMe, which has helped raise more than $15 billion in the last decade: the naming of a new CEO in Cadogan and the hiring of a number of top tech executives and new board members.
Under the terms of the new deal, Classy will become a subsidiary of GoFundMe, with the two companies functioning as separate entities under Cadogan’s leadership.
Read more: Fundraising Software Firm Classy Lands $118 Million In Venture Capital
Last year, Classy raised $118 million in venture funding, money the firm said it would use to expand the size of its product and engineering organization.
As we noted at the time, nonprofits spent 2021 making the same digital shifts all organizations and consumers made.
While overall nonprofit contributions rose 4.1% during the pandemic, online giving increased 12.1%. One of the hurdles for nonprofits has been pandemic-related health concerns that have curtailed opportunities for in-person fundraising events such as benefits, concerts and dinners.
