Startups and Burritos

45% of Americans made new year’s resolutions two days ago.

The rest of us ate a donut.

Let’s admit it. New Year’s resolutions kind of suck.

So here’s an idea for 2016: GIVE IT UP!

That’s what I did four years ago, and today I’m a happier, healthier and more productive person because of it.

With that one decision I expunged from my life the feeling of failure and self-loathing that would inevitably arrive every January 4th when I remembered how much I hated meditating and eating kale. (Side note: Fuck kale. Seriously.)

With the exception of super-annoying people like Tom Brady, who eats avocado ice cream for his cheat meal, most real human beings can’t just say “I resolve to do X” and then will themselves to becoming an awesome person.

As a species we are just not programed to work that way. Science backs this up. Only 8% of Americans will actually achieve their resolution in full this year.

So why do we continue setting ourselves up for failure every year in a game where the odds are so stacked against us?

For me, it was convention. It was simply easier to do what everybody else was doing than to actually think for myself.

When you realize the odds of a game are stacked against you, either play a different game or change the rules to shift the odds in your favor.

In 2012 I chose to play a different game. I finally quit making new year’s resolutions.

This didn’t mean I’d given up on self-improvement and resigned myself to a life of Tombstone pizzas and sweatpants.

I’ll admit at certain times in my life, I’ve given serious consideration to the Tombstone and Sweatpants route

Instead, I opted for different path to self-improvement.

In December of 2011 my friend Patty invited me to a new year’s day vision board party.

“A what party?” I thought to myself. “I am too old to be doing hallucinogens.”

I googled ‘vision board party’.

As it turns out, it was completely different from what I had been picturing.

A vision board party is where you get a group of friends together, cut out pictures from magazines of things you want in your lives and then paste them on a board that you can keep throughout the year . The idea is that by envisioning this life you want, you are more likely to manifest it.

I’ll admit I was skeptical. Going to this vision board thingy seemed like an awfully slippery slope to becoming a full-blown, new-age mystic.

All sorts of questions raced through my head.

Will I have to start listening to Enya? Will I start wearing patchouli? Is my future going to look like this? I’m not sure if I’m prepared to make this leap.

But my friend really wanted me to come. So I agreed to go. When I got there I was blown away.

First off, there was no Enya. Second, it was fun.

Creating a vision board gave me an opportunity to reflect on my past year, and more importantly, it gave me an opportunity to be purposeful about what I wanted out of life going forward. After a few hours of cutting and pasting pictures out of magazines I had a visual representation of the way I wanted my life to look like in 2012 and beyond. Since that time, I’ve made a new vision board every new year’s day.

Yesterday I pulled out my original board from 2012. Amazingly, about 80% of the things I put on it in 2012 have now become a part of my life.

For example, in 2012 I had never climbed a mountain before and it was something I really wanted to do. So I put a picture of a guy scaling a mountain on my vision board. I then hung my vision board over my dresser so that every morning when I got dressed I saw the picture of that guy scaling the mountain. This created a daily visual reminder throughout the year that mountain trekking was something important to me.

It was something I stayed focused on for the year and eleven months later I summited Table Mountain in South Africa. Granted this was a far cry from scaling Everest but it was a start in right direction. I loved the feeling of sitting at the top and looking out at the world. It was a feeling I couldn’t shake.

Summiting Table Mountain, South Africa 2012

Hiking up the Plain of Seven Glaciers for our wedding in Banff in 2013

Hiking Mt. Nimbus in the Columbia Mountain Range our honeymoon in 2013

Why Vision Boards are Better than New Year’s Resolutions

What I love about vision boarding is that unlike new year’s resolutions that are binary and end in failure 92% of the time, vision boarding is more of a continuum.

 You don’t have to achieve all the things on your board in one year. Nor do you have to create narrowly defined goals of what you specifically want to achieve. (e.g one year I just put up tacos).

I like to treat vision boarding like OKRs where I hope to do maybe 60-70% of the things I put up on my board. For me, it’s more about starting down a path of making continual improvement than it is about hitting specific milestones and achievements within an arbitrary timeframe.

Four years after my first vision board, I have not accented any of the world’s seven summits. Nor have I even done any serious mountaineering yet. But what I have done is taken the first step — the hardest step. I’ve shown up.

Little by little, I have made hiking a part of my life and I’m so much happier because of it.

Yesterday, I was at REI and purchased an alpine jacket for a 10-day hiking trek my wife and I are taking this year in Patagonia. Nowadays, I can’t imagine my life without the mountains being a major part of it. I have my vision board to thank for it.

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I was at a tech conference the other day in SF. My buddy was one of the speakers. All the speakers got a bottle of wine.

Buddy: I’m going to Shyp the wine home so I don’t have to carry it around all day.

[Shyp is an on demand shipping app where you take a photo of something and someone comes to pick it up and mail it]

Me: you realize that is pretty much the most San Francisco thing you could have possibly said.

Buddy: yeah, it was, huh? But I don’t want to carry it around all day.

Me: What if it’s shitty wine and the cost of it isn’t even worth the shipping costs?

Buddy: Oh, good call.

[He then proceeds to pull out another app that scans the bottle label and spits out the price of the wine. Upon realizing it was cheap wine, he leaves it on the table.]

I’m calling it right now. San Francisco has officially reached peak craziness. This town is nuts.

When we launched GiveForward in 2008, we were innovating a brand new concept. The term crowdfunding hadn’t been popularized yet, Kickstarter was still months away from launching, and the idea that one could simply set up a site on the Internet and ask friends and family to contribute to a medical fund was completely novel.

Today, we are in a different world. It’s hard to imagine someone who hasn’t contributed to a medical crowdfunding campaign either for a friend, a family member, or for someone they read about in the news.

To date, millions of people have visited GiveForward and raised over $170 million for out-of-pocket medical expenses and life-saving treatments. We boast a net promoter score higher than Apple or Zappos and our office walls are filled with handwritten cards from users (we call them “hugs”) exclaiming how GiveForward has changed their lives. It’s been easy to feel good about what we are doing.

But the reality is we grew complacent.

Simply put, we stopped innovating. Until one day last year we finally woke up and realized that the industry we had helped pioneer had become commoditized — a giant indistinguishable mass of crowdfunding platforms all offering a nearly identical feature set. Even more remarkable than this convergence towards the norm was the realization that every platform, including GiveForward, looked and functioned almost exactly as it did five years ago. Complacency had steamrolled innovation.

So late last year we decided it was time to take a step back and reexamine EVERYTHING. We asked ourselves a single question:

Are we really solving the problems of our users?

When we opened up a dialogue with our community the answer we got back was a resounding no. We were only solving a tiny portion of the challenges our community faced. It turns out crowdfunding just isn’t enough. So we set out to build a better solution.

Evolving Beyond Crowdfunding

Someone going through an illness or a challenging life event needs much more than financial support. They also need meals coordinated and delivered, extra help with childcare, transportation to and from treatment, and a way to communicate updates with friends and family. Most importantly, they need a community to rally behind them and let them know that they’re not alone. Until now, people would have had to navigate four or five different sites to tackle all these needs.

Starting today, they will need just one: GiveForward.

This morning, we announced the launch of the new GiveForward, a centralized place where friends go to help the people they care about in many different ways — everything from sharing photos and “thinking of yous” to coordinating meals, sending needed wishlist items and raising money for out-of-pocket expenses. We want GiveForward to be the first place people turn when someone they know is going through a major life event. But just as importantly, we want it to be the place they come back to again and again to support their friend throughout their journey.

What’s really exciting for us is that we’re already seeing this happen. During our beta period of 1650 new GiveForward pages, we saw a 322% increase in returning users as compared to our legacy fundraising pages. People are coming back, sharing and giving in new and different ways. We see this as a beacon of promise.

Looking Towards The Future

Our new vision has made 2015 our most transformative year yet. This evolution beyond crowdfunding helped us attract a new CEO and some of Chicago’s best executive and product talent to our team. It also helped earn us our biggest partnership to date. This month marks the beginning of our partnership with Nationwide Insurance, a company whose mission aligns so much with our own. When we told them about our vision for the new GiveForward, we couldn’t believe how quickly they embraced it and moved to help make it a reality. Nationwide is a Fortune 100 company, but we’re lucky that they also happen to be one of the most innovative companies in the world. We believe that the new GiveForward will be built on partnerships like this one with companies that share our values and care deeply about making people’s lives easier when they need it the most.

For GiveForward, 2015 is going to be a year of taking what we started to the next level. In 2008 we pioneered the world of medical crowdfunding, but we didn’t go nearly far enough. Today we’re evolving the world of crowdfunding into something that truly solves the needs of people going through life’s biggest challenges. It’s exciting to be innovating again. Suffice to say, we’re through being complacent.

When TechCrunch reported last week that GoFundMe was raising capital at a $500 Million valuation, I decided to write a two-part blog post discussing how a crowdfunding site not named Kickstarter could attract such a high valuation. The short answer is that it has to do with the exponential growth of medical crowdfunding.

Part One of the post laid out the reasons why medical crowdfunding is quickly becoming the largest category in crowdfunding. Part Two of this blog post answers the question of “why now?”

To recap from Part One, the rapid growth in medical crowdfunding over the last five years has to do with three underlying factors:

1.  There is a massive healthcare problem in the US

Americans spend $400 Billion on out-of-pocket medical expenses each year for things that insurance doesn’t cover like co-pays, travel to and from treatment and lost wages)

2.  Healthcare costs are rapidly outpacing wages.

Increasing income inequality is hurting average Americans.  Healthcare premiums have increased close to 200% over the past 15 years while wages have only increased marginally.

3.  Medical crowdfunding changes lives.

Medical Crowdfunding campaigns have become the modern day way of letting someone know “we love you. You’re not alone.”

But Why Now?  

Modern day crowdfunding sites have existed since around 2008. Yet the New York Times reported in January that the tidal shift in the  medical crowdfunding space is just beginning.  If medical crowdfunding truly is eating the world, the next big question is why now? Why 2015?  The answer has to do with changing demographics and the evolution of social norms.

1.  Demographic shift –  Crowdfunding is moving beyond the twenty-something-early-adopter and towards the thirty-something early majority.

To understand the story of medical crowdfunding, we need to first understand the history of crowdfunding and who were the early adopters.  The story begins with Kickstarter and artists.

If we imagine someone starting a Kickstarter campaign in 2010 to produce a new album or a documentary, we could imagine that he might look like this guy.  Let’s call him Sebastian.

Or if he was launching a really successful successful campaign maybe he even looked like this mustachioed  gentleman.

In general, the Sebastians of the world were twenty-something, tech-savvy, early adopters. The people using Kickstarter were cool, the projects they were creating were cool, and everything about Kickstarter exuded cool.  Had crowdfunding started with a different category like medical, it probably wouldn’t have caught on because it doesn’t have the same “coolness” factor, and the tech-savvy, early adopter cool kids never would have tried it.  To be absolutely clear, while crowdfunding existed before Kickstarter, modern crowdfunding would never have taken off without Kickstarter.

Flash forward to 2015.  If we imagine a person starting a GiveForward, GoFundMe, or IndieGoGo Life campaign she might look more like this. Let’s call her Jenny.

Jenny is a busy mom in her thirties raising money for her high school friend battling breast cancer.  She’s at the age where for the first time someone in her peer group might have an early cancer diagnosis.  Jenny’s not a technology early adopter. She’s the early majority.  She doesn’t use crowdfunding because it’s cool.  She uses it because it’s useful.  

In short, crowdfunding is growing up. It was popularized by Sebastian and the cool kid crowd (arts and technology) between 2009-2011.  Between 2012-2015, it began to cross the chasm beyond early adopters.   Over the past few years, much of the growth in the sector has been due to the early majority adopting this technology.

Put another way — remember when your mom first joined Facebook or got a smart phone? Crowdfunding is starting to go through a similar maturation process.  It’s not just for the young’ns any more.  It’s for everyone.  Because like Facebook and smart phones, crowdfunding is moving from cool to important.

2.  Changing Social Norms – The Shift Away from American Rugged Individualism

The other tidal shift we’ve seen in the past few years has been a shift in an American values system that has traditionally placed a stigma around asking for or accepting help.  This stigma stems from a false narrative of ‘American rugged individualism’ and has caused millions of families to suffer in silence rather than accept help from those who love them.

Over the past few years, however, social norms have begun to evolve.  This shift, at least in part, can be traced back to 2013 after the Boston Marathon bombing when tens of thousands of people across the country rallied for the victims by setting up crowdfunding campaigns on their behalf.

One such fundraiser on GiveForward raised close to $900,000 for a young newlywed couple that both lost limbs in the bombing.  Another on GoFundMe raised over $800,000 for a double amputee.  At the time, these were the two most successful medical crowdfunding campaigns to date.

The Boston marathon fundamentally changed something in the American psyche and the way we perceived crowdfunding.  We realized this wasn’t just about the victims. This was about all of us.  Crowdfunding was our way of simultaneously giving the finger to the perpetrators of this horrible crime and offering our unified support to those who were injured or killed.  It was at this moment in time that crowdfunding became a legitimate vehicle to voice our collective will.  Crowdfunding had moved beyond arts and technology.  Crowdfunding had become patriotic.

Most importantly, with the Boston Marathon fundraisers, there was no stigma attached to accepting help. And why should there have been? These victims didn’t deserve what happened to them, and there’s no way they could have ever planned financially for these types of expenses.  Why should their financial futures have been ruined because they happened to be at the wrong place at the wrong time?

So, for a lot of people, that’s when it clicked.  It took a horrible tragedy to bring us to our senses and help us realize that placing a stigma around accepting help for things outside our control is inherently unjust.  Once this wall cracked, we started applying the same logic to similar events in our lives like when a friend got diagnosed with cancer or had a child born premature.

In essence, the Boston Marathon fundraisers helped break the stigma and normalize the idea of medical crowdfunding for much of the country. To be sure, in 2015 the wall has not fully crumbled.  But the cracks are getting bigger and it seems only a matter of time before love and compassion triumph over shame and the damaging lie of American rugged individualism.

Yesterday, Techcrunch reported that GoFundMe was raising capital at an expected $500 Million valuation.  Some folks have been surprised at how big the valuation is but when I heard the number I was surprised how small it was.

I’ve been saying for a while that GoFundMe is a $1B company.  Here’s why.

Medical Crowdfunding is Eating the World.  

Last May I gave a presentation on the trends in the medical crowdfunding space at NYU Stern’s crowdfunding conference. The presentation was called “Medical Crowdfunding is Eating the World” and argued that within five years, medical crowdfunding would be the biggest vertical of all crowdfunding.

Less than a year later, I think it is safe to say that this prediction is going to come true, and probably a lot sooner than I thought. Medical crowdfunding is already the #1 category of three of the world’s top ten crowdfunding platforms including GoFundMe, GiveForward and YouCaring with medical crowdfunding accounting for anywhere between an estimated 25%-70% of the dollars contributed on these platforms.  On top of that, the world’s the second largest crowdfunding platform IndieGoGo, recently joined the club this past December with the launch of IndieGoGo life.

Why is Medical Crowdfunding Eating the World

There are three reasons.

1.  Medical crowdfunding is an insanely massive market.

2.  Our healthcare system is shit and trending shittier.

3.  Medical crowdfunding changes lives.

Massive Market

Deloitte estimates that Americans spend $400 Billion a year on out-of-pocket medical expenses.  This is an insane amount of money.  And these are just the expenses that insurance doesn’t cover like, co-pays, travel expenses to and from treatment, and lost wages.   These are the things people raise money for when they run medical crowdfunding campaigns.

When you compare the potential size of the medical crowdfunding vertical with the size of, say, the technology crowdfunding vertical, it’s not even close.  The need for medical crowdfunding is far greater than the need for technology crowdfunding.  As a rough comparison, in 2013 venture capitalists invested $29.3 Billion into early and late stage technology companies.  Even at the height of the bubble, the total amount invested by VCs topped out at $105 Billion.

$400 Billion vs $29 Billion

If I had to hazard a guess, I would estimate the potential size of the medical crowdfunding market at roughly an order of magnitude bigger than potential size of the technology crowdfunding market.   Simply put, not everyone needs seed capital to start a business or a Bro app. But EVERYONE does need healthcare.

Our Healthcare System is Shit and Trending Shittier

Every 30 seconds an American family goes bankrupt due to medical costs, and the situation is actually getting worse for the average American.

This graph below is called the Milliman Medical Index.  It shows that the cost of healthcare for an average family of four more than doubled between 2002 and 2012.

The average family of four now has more than $20,000 per year in healthcare costs.

On top of that, families are paying more out-of-pocket today than ever before as insurance premiums and workers’ contributions continue to outpace wages.

In sum, our healthcare system is broken, and over the past decade or so, it’s only gotten worse for people.  In comes a solution.

Medical Crowdfunding Changes Lives

Medical crowdfunding saves lives.  It keeps people out of bankruptcy.  And it provides millions of people with hope in their darkest and most difficult days.

All you have to do is watch either one of these videos below and you intuitively “get” why these campaigns are popping up everywhere.

(Justin’s GiveForward Campaign) (Mark and Jenny’s GiveForward Campaign)

Medical crowdfunding is not a frivolous activity.  It’s not potato salad.  It’s not a fad.  Medical crowdfunding is the same thing people have been doing for centuries when a loved one is sick — coming together and letting that person know that he is not alone.

Medical crowdfunding is empowerment. It’s compassion. It’s love.  And that’s why it’s eating the world.

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Part II

If Medical Crowdfunding truly is eating the world, why now?  In part two, I’ll discuss the evolution of crowdfunding from 2008-2015, the demographics of the space and why medical crowdfunding is just now crossing into the mainstream.