ROSE broome, ceo of Handup, pitches the service to Bobby (street name) in downtown san francisco

Daring to reimagine the panhandling economy

Startup Portrait #2: HandUp

Startup Portraits is an ongoing series of visual stories about the founders of Bay Area startups, their visions, and what they're learning. In mid-September I met HandUp CEO Rose Broome at her apartment in San Francisco, then tailed her through the rest of the workday. For the interview below, I spoke with Rose and her co-founder, Zac Witte. I've edited the conversation for length and clarity. Learn more about HandUp: Company homepage, VentureBeat story, AngelList profile.

What does HandUp Make?

We make a direct-giving system for donating to homeless people and neighbors in need. It lets donors contribute to specific people who are seeking donations for their basic needs, and then those people can redeem their credits for productive items and services.

I met Rose (right) at her apartment in the Mission and quickly noticed the StreetSheet on her couch. The paper helped inspire the experience of using HandUp. Rose and her co-founder, Zac Witte (left) work out of the HatchToday co-working space in SOMA. They sit a stone’s throw from Clara Brennar, the CEO of Tumml (behind Zac), an urban innovation incubator that accepted HandUp into its first class earlier in the spring.

What’s the most delightful experience someone can have using HandUp?

Well, it’s a full feedback loop. The idea is you see a homeless person face to face, and they give you a card that lets you donate to them directly via text message. You have that emotional connection. And then we track it all, so in the future you'll know how that person used your donation. We'll send you a follow-up message that says: “Hey, Joe just picked up some new socks using your donation. Thanks a lot.” That full loop is really fulfilling to both parties.

What we've heard from our members, and also through Project Homeless Connect, who works with our members, is they've felt a new sense of self empowerment, that they have something to be excited about, to rally around. It’s a way to help themselves that they feel is legitimate. They have this product that’s built just for them.

Rose usually takes BART to the office, but with a packed day ahead, we grabbed a ride with Lyft. Our driver asked about HandUp and Rose lept into the compassionate version of the pitch. And it was true—HandUp is driven by its social mission. Unspoken was the money at stake: charitable giving to individuals tops $26 billion per year in the U.S. Rose leaves a stack of cards in the car, each with a prompt to donate to a homeless HandUp member.

In a conference room at HatchToday—and just five minutes into the workday—Rose scrambles to connect her laptop to a TV for a mock pitch. She quickly realizes she has the wrong dongle and runs for help. Seconds after the TV flickers to life, her audience walks in: Kurt Beyer, a lecturer from the Haas School of Business at UC Berkeley.

After Rose delivers a quick pitch, Kurt peppers her with questions. (A Tumml partner takes notes.) It goes well until Kurt pegs HandUp an “impact startup,” a term they both know is poison to VCs. Rose struggles to recover and flips back to her slide on market size. Kurt mentions white-labeling and begins to warm again. Impressed, he asks Rose if she needs any introductions. She says yes—and then follows with a bevy of additional asks. Kurt grins—Rose means business. The two exchange cards as an alarm sounds. Time’s up.

If you guys succeed, how will the world be different?

People won't have to sleep on the street each night. People will have access to showers and toilets and have their basic needs met. A lot of people feel invisible when they're on the street, trying to get the attention of people passing by, and this is a different way of interacting that everyone will be more comfortable with. The donor community wants that as much as the homeless community wants that—to help people rise to a basic standard of living. People want to build relationships. We let them do that.

Up one floor in HandUp’s building is the headquarters of Twilio, where an old friend of Rose and Zac’s, Meghan Murphy, manages community partnerships. The proximity is a convenient coincidence, as the core of HandUp’s user experience relies on Twilio’s services. The Twilio team is equally enamored: HandUp’s use was highly unexpected. Here, Rose and Zac say goodbye after a lunchtime discussion of HandUp’s growth.

As a mission driven, for-profit company, HandUp walks a delicate line. At what point are its members being exploited? Will investors want to touch a company that puts its users above profit? Rose is well versed in the dilemmas they face. “Why would we reserve the most powerful, efficient business model for the Zyngas of the world?” She asks. “Why wouldn’t we use that to have a positive social impact? I think we can do good and make money at the same time, and in fact, I think making money can help us do even more good.”

What behavior are you trying to encourage that your users are most resistant to?

We've just put this pilot out, so it’s hard to say. Making sure that people have the confidence that we're a secure system is really important for us. It’s mostly a user experience challenge. We've already done a number of iterations to make the donation process as smooth as possible. We're using all the standard lean startup approaches. We do user testing, we look at our funnel, we look at our conversion rates.

What’s the most unexpected lesson you’ve learned about your users?

We didn't know: Are homeless people going to use this service? Or even understand it? And with very little explanation, everyone gets it. People call us every day asking how they can sign up.

At the intersection of Market and Van Ness, Rose watches as LaTonya (shirt with stars), who is homeless, distributes her HandUp cards to by-passers. Not everyone took well to their presence. Rose: “People in the community don’t want to stare, but there’s a lot of curiosity there. Our donors really love reading about our members. They can go on our site and read through their profile. So I think being able to fulfill that curiosity is delightful for donors.”

HandUp maintains a close partnership with Project Homeless Connect, a city program. Once a member receives a donation, it can only be redeemed at the PHC office. So far the system has proven itself: Members have not hesitated to visit, and PHC is typically able to offer additional services once a member is in the door. Pictured, the PHC team and Rose discuss goals and logistics at PCH’s office.

Just outside Project Homeless Connect’s mid-market office, Rose walks alongside Georgia (in wheelchair), a HandUp member who lives in a nearby SRO. So far, Georgia told me she’s only given her HandUp cards to close friends. “People might think it’s a scam,” she said. Still, she’s raised nearly enough for new sheets and blankets. I asked if she planned to continue with HandUp and she nodded. “I’m going to try. I’ll let you know how successful I become!”

What’s something you got right that you almost didn't get right?

Picking the right lawyer. We’re working with Yokum Taku’s team at WSGR. Also, choosing the right corporate entity. We had thought about being a tandem entity—both corporate and non profit. Then we thought about being a straight c-corp, because investors want that. And we decided on the Benefit Corporation after a lot of research. We feel good about it.

Why don't you just give your members cash?

Our members know what they need better than we may, but we know that donors want transparency, to know where their donations are going. That’s a main concern of giving money to people in need: Are they going to spend this on drugs and alcohol? And whether they would or wouldn’t, it’s a fact that that’s a major barrier for our donors. By providing that transparency we take that concern away, and our members have had no problem with that at all.

Isn’t that paternalistic in some way?

The point of HandUp is to help people meet their basic needs. Our goal is to expand to other fulfillment partners. We're already talking to Walgreens and Safeway. It’ll give even more flexibility to our members.

At the end of a long day, Rose met with Tomio Geron, a staff reporter at Forbes. As if on queue, she handed him a card for a HandUp member, Stanley, and explained how the system works. Early on, she told me, she abandoned personal business cards for those of HandUp’s members. “Why waste an opportunity to help?” she explained.

What do you guys need right now?

We would love for people to visit our website and find a member who they have a connection with and make a donation. We’d also love feedback on the donation experience. People can email rose@handup.us.