Dave Boyce

From charitable groups to competition singers, Fundly, based in Palo Alto, Calif., is building momentum as it helps organizations raise money over the Internet.

Fundly allows users to set up a free account and raise money for a cause. Since it was founded in 2009, Fundly has helped raise more than $227 million for teams, clubs, nonprofits and other organizations. The company makes money by charging a fee to people who use credit cards to donate.

"Notebooks and envelopes have been the tools of the past," said Fundly CEO Dave Boyce in a telephone interview. "Now it's possible for those PTAs, teachers and booster clubs to run a professional process. We see ourselves as a way to augment and provide an alternative to paper-based fundraising."

Once created, organizations can promote their cause through branded tools, including email or social networking, according to Fundly's website.

Boyce started Fundly following his experience at startups in Utah and after studying at BYU.

While at BYU studying German, Boyce started his own company, which taught him a great deal about how to run a business, he said.

"BYU is a phenomenal environment to teach young entrepreneurs," Boyce said, who sits on the BYU's Marriott School marketing advisory board. "I think Utah in general is an entrepreneurial culture."

Education-related customers make up the biggest user group, or 25 percent of the profiles. O ther o rganizations, like Habitat for Humanity, have joined Fundly to help raise donations.

Habitat, a nonprofit that has built more than 400,000 homes for the needy, entered a global contract to use Fundly for all volunteer-based fundraising.

The move is part of an overall social media fundraising platform known as Share.Habitat.org, said Dave McMurty, senior vice president of strategy for Habitat for Humanity International.

"Our goal with Share.Habitat.org is to leverage social media and empower our supporters to share their experiences and raise evermore awareness and support for Habitat's mission," McMurty said.

Utah organizations, like BYU's Vocal Point, are also seeing donations roll in as a result of Fundly.

The singing group started their Fundly account in the Spring of 2011. Vocal Point uses Twitter and Facebook to drive traffic to their Fundly page. Before, the group would only receive donations from Alumni, but Fundly has allowed them to expand others, Scott Clark, a Vocal Point Alumnus who manages the donations, said.

"It helps us to broaden the message and use existing social media platforms to get our message out there," Clark said.

Clark also said that when Vocal Point made it to the NBC show "The Sing Off," they took the opportunity to spread the word through social networks and raise money on Fundly to pay for the singers' scholarships.

The company received $5 million in series A investments in September from Silicon Valley-based Morganthaler Ventures to help fund development and recruitment.

"Our mission is to give any nonprofit, regardless of size, from the biggest to the smallest, the best tools in the world for free," Dave Boyce, chief executive officer of Fundly, said. "In order to do it for free, we have to do it at scale. It's a classic venture capital proposition."

The series A, coupled with seed investments from companies like Kapor Capital, Correlation Ventures and Seraph Group, raises Fundly's total capital to $7.5 million, Notable Angel investors include Clayton Christensen and James Currier.

The money will go towards hiring more engineers to its 14 person operation in hopes to build better social networking infrastructures so groups like Habitat for Humanity and BYU's Vocal Point can reach more potential donors.

Boyce said Fundly has employees in Utah and is interested in hiring more from the talent pool in the area.

"There are plenty of database-oriented fundraising solutions," Boyce said. "What the world needs is a social platform. So not only do you know who your donors are, but you know who their friends are and who they influence and you give them the mechanisms to share using their social networks."

Mark Goines, a partner with Morganthaler Ventures, joined Fundly's board of directors after the investment round. In the past, Goines has invested in cloud-based and consumer financial startups like Dropbox and Mint.com.

"As a VC, I have to look for something that has the potential to be a multi-hundred million dollar outcome," Goines said. "Fundly is in a very large category— a $300 billion a year category."

Email: jferguson@desnews.com, TWITTER: @joeyferguson