MemberPlanet Simplifies Life for Membership Organizations

E-Commerce5

Typically, growing businesses are advised to develop expansion plans and stick to them. But sometimes you have to go where your customers lead you.

Being open to new verticals is one of the ways MemberPlanet has evolved from one college student with an idea for dramatically improving the financial management of his fraternal organization to a company that serves more than 13,000 nonprofits, faith-based organizations, alumni organizations, parent-teacher associations, and even the U.S. Air Force.

When MemberPlanet co-founder and CEO Rob Hammond was a senior at the University of Southern California, he got a peek into the books at his fraternity as a member of its executive board. He found that 25% of its budget was not being collected.

“It was very real money, and it was shocking to see how the finances were being run because you had friends collecting from friends. Very quickly I went out and spoke to a whole host of chapters at USC and other universities, and it was the same for them. So, I did see the potential for having a great business solving a real need,” Hammond said.

To solve this need, Hammond started the company GreekBill, which has since grown to serve fraternal organizations at more than 450 universities. It enables members to pay for organization expenses such as dues, rent, parking and meal plans.

As the folks at GreekBill worked to provide solutions to undergraduate fraternal organizations, the company naturally expanded to serve those organizations’ alumni organizations as well. They found that, while the alumni groups had many similar challenges, they had a host of different ones as well.

One issue was that the administrators were using a variety of platforms to meet all the needs of their organization. The volunteer leaders didn’t just need financial management solutions. They needed tools to communicate with their members, manage events, and raise funds. So Hammond started another company, MemberPlanet, to combine all those tools into one platform.

While MemberPlanet offers a variety of tools to help nonprofits run their operations, both companies are payment facilitators at their core.

“Payment was and is fundamental,” Hammond said. “It has been a good vehicle for us on the MemberPlanet side because with handling the processing for an organization, we’re able to keep the actual subscription amounts that they’re paying on a monthly basis at levels that they’re able to afford. So, we see it not only as an integral part of our business, but also a way that we’re able to bring these services to the organizations.”

COO Chris Rhode expands on this idea: “In the spirit of the payfac model, we’re dealing with a lot of nonprofits that would have difficulty using any other payment processor other than a PayPal-like service,” Rhode said. “With what we have built, with the integration of our payment processing platform with our membership database, our event function, and our donation campaign function, you’re getting full financial transparency over all activities within the group. It’s exactly why we put payment processing at the core of what we think we offer for these groups.”

The nature of MemberPlanet’s business means that it finds its customers to be lower-risk than in some other industries.

“The good thing is, with our target market, certainly starting with GreekBill and moving on to MemberPlanet, our members typically have a strong affinity to the group, so our chargebacks are significantly below whatever the industry average is,” Rhode said.

MemberPlanet’s know-your-customer procedures are aided by the fact that their relationships with nonprofit organizations often begin small, Hammond said. They build up history before payments processing becomes a part of their relationship, giving them valuable information they can use in the underwriting process.

It is also aided by the fact that they work with multi-tiered organizations. In many cases, they are able to do the underwriting at a state level. That gives them a “head start” with the local organizations, he said.

As MemberPlanet grows, it is finding opportunities in surprising places. When an RFP for a contract with the Air Force to assist with the management of on-base clubs, such as officers’ and enlisted clubs, crossed their desks, they hesitated to pursue it. It wasn’t a vertical they had ever considered. But the more they thought about it, the more they realized it was a great match.

“The clubs that we were talking about have the exact same challenges as the alumni associations and the PTAs in terms of membership management,” Rhode said. “Exactly the same challenges. Just a different vertical. They use a lot of different words, especially in the military, but they had all the same communication challenges: how to engage their members, how to increase membership, organize events, fundraising, all the things we do on our platform every day.”

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