The Clovest Blog

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Milk Cult: Unplugged (Part 1)

Pat and Ed after a long day selling tacos out of a food truck at Union Kitchen– one of the many hustles undertaken by the formidable Milk Cult.

Clovest: How did you guys get started in the food industry? What were your backgrounds before the Milk Cult?

PG: Ed and I both have extremely into food, the culinary world, and all that stuff. Its one of those things we bonded over and continuously bond over. Him and I both did a lot of private catering events growing up and I've always had the pipe dream of us both working in food. My uncles have a pretty successful bar/restaurant Brooklyn and I’ve just respected the hell out of them for that and how well it went for them. I just saw that they were doing what they wanted to, they were doing it well, and they were being recognized for it. And they were working their asses off, but they're living the dream.

I had a bunch of random jobs, never any serious ones in the food industry. I eventually found myself working at Takorean– one of pioneers of the DC food truck scene. I remember when I was working for Mike, the owner of Takorean, I made it more than a job– I decided to soak up as much as I could from him because he had a very successful food business in the same kind of framework that I would like to have. He does it very well and very intentionally– and he wants to make good food but he's not so romantic about it. He’s making high quality food, but also runs a very successful business.

So I soaked up as much as I could and then that job ended. During that time, Ed was in Indonesia teaching English. So when he came back from Indonesia, I wasn't working at Takorean anymore and we both kind of were like, “What are we doing?” And while he was away, he would send me photos of motorcycles rigged into food carts and say like, “Look how crazy this shit is”, and I'd say "That's awesome!". So when he got back we were both pipe dreaming about "What if we did something like that?"

Started from the bottom– or a motorcycle. Pipe dreams (pun intended) have created some of DC's best handmade ice cream sandwiches.

Clovest: Right the never-ending question of, “What are we doing with our lives?” So, ice cream sandwiches? Was that the obvious answer?

PG: Well, Ed has a reputation amongst our friends as the guy who makes really good ice cream. He got pretty much the best home model ice cream maker a long time ago and since the day he got it, he's been making crazy awesome ice creams– he made a fried chicken ice cream one time, which was disgusting and he'd trick people into eating it, but then he'd also make up for it by making like the best blackberry ice cream you've had in your life. So when we got talking to what would we do (food wise), Ed was like "Ice cream", and I was like "Yes, but...what could we add that would make it a bit more interesting?" and we both were like "ICE CREAM SANDWICHES!".

Really like from there we just both got so excited about the idea– the idea about a motorcycle, a food truck, a store, none of that existed. It was just about making ice cream sandwiches interesting and different, but still accessible.

So we talked about it a bit more seriously and Ed drafted up a business plan, which was really helpful because it made us both realize that this could actually happen. Then the idea came one day of getting an old cafe-racer style motorcycle with a sidecar and turning the sidecar into a freezer and selling ice cream sandwiches out of it. And Ed, who has a lot more experience driving motorcycles, was like "That'd be so cool, but logistically it can't be done." But an hour later, he called me back and said, "Let's do it."

Clovest: So you got started on the motorcycle?

PG: Actually, the motorcycle came much later– we started with the product first. I was reading the [Washington] City Paper and I read the article about Union Kitchen and I thought, this looks perfect. So we visited Union Kitchen and from the moment we were there and explained to them everything we wanted to do, they were very excited to have us join. They were so great– they really could not have been any more helpful with kind of holding our hands through the whole process of getting our business off the ground.

Clovest: How much did the growth for your business come out of the opportunities provided to you by Union Kitchen?

PG: Just about everything. Whether it was other food businesses, whether it was Cullen or Jonas, or just people in the Kitchen who heard about things that were going on. We did a couple of things on our own and our first couple of events were disasters, but you know, good disasters! Very important lessons learned.

SUPPORT DC PATISSERIE'S CAMPAIGN HERE

Alex (center) with the staff behind the Cooking Channel's Unique Sweets, which recently featured DC Patisserie!

Clovest: What were you doing before you decided to start DC Patisserie and what inspired you to start the company?

Alexandrine: I was a lobbyist for the Recording Industry Association of America for about three years. I started taking some cooking baking classes during that time and that’s when I started making macarons and taking them to work, taking them to different parties, that sort of thing. People liked them but I was definitely working on the recipe.

To be honest, one of the things that excited me about macarons was the fact that they were supposed to be really hard to make. Like there was something so inconceivably difficult about getting them just right. A lot of people try to make them and get discouraged, and a lot of people can make them on their first try but have trouble with consistency.

I was not one of those people that got it on the first try. I had plenty of trouble, especially getting them to be consistent every time.

But, as with most things, you keep trying at something long enough and you begin to get the hang of it. So I think about into my last year, I heard some rumblings of how they were going to let people go and I thought to myself, hey, maybe this is the time for me to actually to start this business I’ve been thinking about for the past couple years. I had just recently gotten married and my husband has been incredibly supportive through this whole thing and that’s really meant everything to me.

Clovest: There are a lot of DC chefs finding their start at Union Kitchen. What’s your experience there been like?

ADB: I don’t know if you know Maya Robinson from the DC Grey Market, which was an event for food entrepreneurs who didn’t have the registration or business licenses to sell their food in stores but who wanted to give their stuff a try. I went to a bunch of the Grey Markets when they were running and although they closed after a while, Maya told me I should get in touch with the guys at Union Kitchen.

So I went down there to check it out, and being one of the first people to sign up, there was practically nothing there. It’s a lot different now. I told them I’d sign up for six months and if I wasn’t selling anything, I’d leave. I’m doing o.k. now, so I’m still here.

I’ve had a great experience working here and the people I see on a day to day basis are great to work with. As this company gets a bit bigger, though, I think I will probably look for a bigger space. I mean, this depositor is gonna take up a bit of room. And I think that’s really what Union Kitchen is all about, giving entrepreneurs a launch pad to try out their stuff.

Clovest: Some of us have never even had a macaron, can you tell us a bit more about what goes into them and how they’re made?

So you have your egg whites and you have your sugar, and usually while you’re beating the egg whites you’ve got your sugar boiling at 118 degrees—118 degrees is sort of a magic number—and when you hit it, you add that sugar mixture to your egg whites, which starts to cook them.

After things cool off a bit, you stop the mixer and the egg whites are usually a glossy meringue at this point. The meringue is added to your almond flour mix and gets folded together. This is really the part that takes practice. If it’s mixed too much the batter will flow too quickly and when you go to pipe it, it will run all over the place. If you under mix, the batter will be too thick and when you pipe the cookies the batter will be stiff and puffy. When everything’s just right it will pipe slowly, and when baked it will create a foot—that’s the ruffle that makes it a macaron—without air pockets.

Once you’re done with that you take two cookies and you sandwich ‘em together with whatever filling you like.

Alex, at her craft. DC Patisserie will increase their production ten-fold with the new macaron depositor.

Clovest: What’s your favorite flavor?

ADB: Peanut butter and jelly. Without a doubt.

Clovest: So how did you hear about this Great Macaron Depositor?

I think I first saw it on YouTube after I had been looking at some of the French houses. Yes, the French have macaron houses that do absolutely nothing besides make macarons, if for no other reason than just to be elitist about it. It’s kind of like the fashion designers out there.

I went to the New York location for one of these houses, I think it was Lourdray, and waited in line for like 30 minutes for one of their macarons. Maybe it was just the batch that came out that day, but I wasn’t that impressed. It was O.K. I think at a certain point I’ve become biased.

Clovest: A lot of people have started their own businesses in the last couple years. Could you speak a little bit about what it’s like running your own company?

I know it sounds kind of dry, but you’ve got to know financial management. I was talking to a friend who is a barre teacher; she loves it and she’s toyed around with the idea of starting her own business. I asked her one day: "Have you ever looked into making a business plan or plotting out how you’re going to make money doing this?" She said "Oh, I guess you’re right." and for me it wasn’t so much about being right, it was just that I want her to succeed. I think these are the kind of things that entrepreneurs tend to neglect when they’re coming up with this great idea.

The financial side of things is really important because it basically amounts to how long you can do this thing that you love so much. I don’t think that many entrepreneurs realize that they will actually have to deal with spreadsheets or make a profit and loss statement. I mean, if you can pay for someone else to do it, that’s great, but most people starting a small business don’t have that kind of money to spend. So I’ve been to some classes on writing a business plan and that sort of thing. The Women’s Business Center in D.C. runs some great programs for people thinking about starting up a business of their own.

Clovest: Why did you decide to crowd fund this project and what made you choose Clovest?

I’ve run this company for about fifteen months now, I’ve put in a decent amount of my own money into it and I realized that at a certain point, I can’t do this alone. If my company is going to take on some of the capital expenditures that it needs to grow into the next stage, I’ve got to get other people on board.

So I looked at Kickstarter as well as Clovest, and I didn’t really have the time to worry about managing the rewards process. The prospect of hosting a macaron party for every person that donated $500 was pretty daunting. Clovest just made a lot more sense to me. And there’s also the whole local and interpersonal element that I really like.

Mint chocolate chip macarons– do these not look delicious? Support the campaign and bring your friends to the macaron making party!

Clovest: I remember you’ve said that you tend to have a bit of stage fright. Are you excited for your macaron crafting marathon?

It’s not stage fright. I just tend to be more comfortable around smaller groups of people. I haven’t thought about the party that much yet. I think we’re just going to have a good time and learn how to make macarons.

Torie Partridge, owner of local design shop Cherry Blossom Creative, is the first person to fund three different projects on Clovest! Of course, we thought this was pretty awesome so we wanted to let the rest of our Funders know who Torie is, why she decided to lend to three local businesses, and highlight the other great stuff that she does. Turns out, Torie is not just friends with all three entrepreneurs she funded, but more importantly, their work and fundraising campaigns have been an inspiration in her daily life.

First, Torie worked as a manager at Domku with Kera Carpenter (founder of the Nurish Café and Nurish: The Center for the Creative Culinary Economy), who Torie described as having impeccable taste, remarkable brilliance and as just an all-around inspiration. She said that one thing she learned about Kera from her work at Domku is that she’s not necessarily a very public person.

When Torie saw that Kera had a fundraising campaign, she knew that something special was going on.

“Kera is fantastic and when I saw that she was doing this new thing, I knew that she was going to do it to the fullest, so I had to jump in. Kera has this ability to get things done and done right.”

Torie now works out of a space in Union Kitchen and sees the owners of Milk Cult, Ed and Patrick, on a daily basis. According to Torie, they’re great guys and hilarious, wonderful people, and another example of people who just seem to be really good at everything they do. “They came on the scene with this really basic idea, like ‘We’re going to make ice cream sandwiches’ and then go ahead and make them ridiculously good."

Then they told me they were going to make a sous-vide burger and I thought ‘um ok...’ but it turned out to be amazing. These guys are just awesome food wizards.”

She also told us that she’s seen a sample of the ingredients for the breakfast tacos and they sound amazing. So for all you Petworth residents, be sure to join them in opening the Milk Cult Sanctuary!

Alex, who owns DC Patisserie, and Torie also see each other on a daily basis. They became friends through Torie’s self-described tendency to obnoxiously bug Alex about trying her new macaron flavors throughout the day. And yes, there is a difference between a “macaroon” (think Girl Scout cookies) and a “macaRON” (think heavy French accent), but the two often get confused for simplicity’s sake. Torie says she’s constantly trying these light, chewy little almond flour cookies filled with cream, butter cream or jam and she can’t get enough of them. She says that she’s on a quest to find a better one and has been stumped so far (though she admits she hasn’t been to Paris for a true comparison).

Clovest would like to thank Torie for showing these businesses so much love and to all our Funders and businesses working together to make D.C. something really special.

Many of you may know Torie or know of her through her design work for several Union Kitchen start ups and a ton of different D.C. businesses, like her mural-map of Petworth for Ace Hardware (which inspired a series of prints of other D.C. neighborhoods), the logo for Mt. Pleasant's new Each Peach Market, the design for Capital Kombucha's Cherry Blossom flavor and many, many other projects. Be sure to check out more of her stuff at Cherry Blossom Creative!

Fund loans with cards!

We’ve heard a lot of feedback from funders regarding our payment options and want to thank you all for your patience and understanding as we worked through our growing pains!

After assessing the available options and working with our development team, we are pleased to offer the ability to fund loans with credit and/or debit cards! Best of all, you provide your preferred payment method upfront when you make a pledge, meaning you won't have to create any other accounts nor come back to fund your loan– once a project meets its goal, we simply debit the card on file and transfer your loan to the business!

For those of you who are curious, we're using Balanced Payments, a secure third-party payments service to handle all card processing. They also offer the ability to do next-day payouts to U.S. bank accounts which was crucial in enabling us to create Clovest Balances (see below).

Clovest Balances– keep the good flowing by using your repayments to fund new Clovest projects!

We're excited to announce a new feature that gives our users more flexibility when funding projects and receiving repayments: Clovest Balances.

From now on, when we receive repayments on loans you've made to businesses through Clovest, we'll simply credit your Clovest Balance with the owed amount. You’ll then be able to use those funds to make loans to new projects or withdraw them to a U.S. bank account at any time (and receive the funds by the next business day)!

No more external accounts. No more verifications. No more delays.

Just your money going to your favorite local businesses (or directly to your bank account) whenever you choose!

Redesigned Dashboards– more info where you need it.

We've also redesigned our dashboards to help you keep track of your pledges, loans, and repayments all in one centralized place. Additionally, you can quickly view updates from your favorite projects and businesses without having to navigate away to other pages.

Check out this screenshot below (or view it for yourself at: https://clovest.com/user_dashboard) and let us know what you think!:

And why we’re thrilled about our six month prize membership from the William James Foundation’s 2013 Sustainable Business Plan competition.

It wasn’t long ago that Clovest was simply an idea. Or as my friends would have you believe, just that sort-of-kickstarter-like-thing-but-really-an-excuse-for-me-to-quit-my-job “project”. I had faith in it from day one, that was never in question. It’s just that, in many ways (as with most companies before they launch), it hadn’t become a real entity that people could see, understand, trust and value. Tonight was an incredible step for us in our journey to becoming that real company that I, as it’s founder, always knew we were but needed to convince the rest of the world that we were as well. Tonight, we presented as a finalist for the William James Foundation’s Sustainable Business Plan Competition for the Washington, DC/Affinity Lab Prize category. It was an exhilarating, educational, and humbling experience all at the same time. As this was our first ever presentation (and, indeed, our first ever business plan that we wrote), we were a bit of n00bs in the endeavor and much of our preparation focused on convincing our audience and gracious judges that 1) yes, we offer a real product that fits a market need and, 2) we can make money and scale this venture. While there were a few missteps here and there that, frankly speaking, were bound to happen with any first time pitch, I came away thinking I had done fairly well with it. And to a large extent, I still feel strongly about our performance and am forever grateful for the opportunity to have presented. But, in our preparation, I had thought long and hard about why I had wanted to win. Why the Affinity Lab as a prize mattered to our company. And why we still valued keeping it as our home. I thought about this not just because it compelled me to compete, but because I was sure that question would have to be asked during the Q&A. But then, before the adrenaline stopped rushing from the fumbled answer to “give me the numbers”, and before I could get out any more, there were no more questions and it was all over. So with part regret, part gratitude, and part humility, I thought it fitting that I take the time, at whichever hour it may be, to make sure that our customers know, the lab knows, and the world knows why it is that we think the Affinity Lab is the best thing that has happened to our company. To put it simply? It made Clovest what it is today. When we entered the William James Foundation Business Plan Competition back in December of 2012, we were still new lab members and very much determining the kind of company we wanted to become. We always knew that we were going to create a platform that connected small businesses with their local communities through zero-interest loans, but the how + why of that process were still unclear. To a large extent, the feedback received through the competition provided us with key advice in figuring that out and has been immensely helpful in leading us to our success thus far. But to have gone from starting our business with this competition to presenting as a finalist just six short months later? That wasn’t just us, that wasn’t just luck, and that wasn’t just the feedback.

That was, without a shred of doubt in our minds, overwhelmingly the result of basing our company out of the Affinity Lab.

Say hello to Masai!

Masai McDougall is a D.C. native and loves the idea of every day Washingtonians having a say in the economic development of their city. After spending four years at a downtown D.C. law firm in its securities enforcement and commercial litigation division, Masai decided that he wanted to make local growth and community participation his priority. Masai also serves as an attorney for local small businesses and is a graduate of Howard University Law School, Wesleyan University and the Sidwell Friends School. Here’s a brief statement on why he joined Clovest:

There’s been a lot of discussion on crowdfunding lately, and how the JOBS Act is set to change the way people invest.

In America, a security is basically an investment in a risk in exchange for a monetary return.  Because our government wants to make sure these transactions stay on the up-and-up, we created the SEC to oversee and regulate the business of selling securities.  The economy likes securities because companies need capital in order to expand, and securities give regular people like you and me a chance to invest in these companies and share in their profits.  But here’s the problem: we don’t always agree with what those companies are doing.

More and more, our society highlights the problem of large and very large corporations exerting their power.  We have begun to take a turn back to the local, the down-to-earth, the simple. If we want our money to reflect our desires for the economy and for our society, where can we invest? The SEC requires a business that wants to offer securities to the public to spend tens of thousands of dollars in administrative and legal fees. This is where crowdfunding comes in.

Crowdfunding is about investing a little bit of your money into something you love and something you want to see grow. You’re not in it for the money; you’re in it because you want to see it happen. You want to have a say in what companies you support and you want to have a say in what businesses open and stay open near you. This is where Clovest comes in.

Clovest is all about engaging communities in their own economic development. When businesses turn that community engagement into a loan to make their business better, we think there’s a little cycle in there just waiting to have its day in the sun. That’s businesses thriving and making their trade a little better and giving back to their customers every step of the way. It’s customers feeling like they played a part in something awesome. And each one feeds the other.

Note: This blog post was originally featured on UnSectored on May 14, 2013 as part of their series “Put Your Money Where Your Mouth Is"– an exploration of  how we can effectively use our power as consumers to create a more equitable, sustainable society. 

Localism has become all the rage in recent years. Ubiquitous farmer’s markets, locally brewed beers, locally manufactured apparel, and even locally made kombucha all reflect consumer’s increasing preference for all things local. Yet despite the strong demand for (and supply of) these local goods and services, how has our newfound local consciousness impacted our investment portfolios? Not all that much, as it turns out. Michael Shuman, author of Local Dollars, Local Sense and well-known authority on local investing, notes that of the $30 trillion Americans keep in stocks, bonds, mutual funds, pension funds and insurance funds, less than one percent goes toward small local businesses—despite the fact that more than half the jobs and output in the private economy come from such businesses. What are the ramifications of this capital allocation? Shuman posits that if even 1% of this money (roughly $300 billion) were redirected to Main Street, there would not only be greater economic activity and growth of local communities, but also investors would likely see higher financial returns from more healthily diversified portfolios. Given the obvious benefits for local economies and local investors, not to mention the rise of the locally conscious consumer, what’s stopping a surge of local investment? Well, for one, there are few opportunities available for average investors to easily invest in Main Street: Of the more than 7,500 mutual funds in the U.S., not one offers a portfolio focused on small or local businesses. Moreover, securities regulations, many enacted during the depths of the Great Depression, have made investing in small businesses prohibitively costly and complex for both investors and firms trying to raise capital. The passage of the JOBS Act in April 2012 was supposed to alleviate this process by reforming laws enabling small businesses to solicit investments from the general public, but the SEC has neither provided the new regulations required for such investment nor is it clear when they are likely to do so. So where does this leave us as locally conscious citizens, consumers, and, most important, investors? Despite the seemingly bleak landscape for the local investment movement, there actually has been a great deal of progress in recent years to change the nature of investment in America. Some noteworthy parties that have pushed forward this movement include:

Cutting Edge Capital: Consulting firm dedicated to promoting local investment solutions such as direct public offerings and community investment funds.

Fundrise: Real-estate crowdfunding platform; enables unaccredited investors to invest as little as $100 in real estate projects (and become equity stakeholders).

LendSquare: Microloan crowdfunding platform; allows individuals to fund projects of businesses and be repaid loan with interest over time.

Community Sourced Capital: Microloan crowdfunding platform; allows individuals to lend up to $250 to businesses at zero-interest and be repaid principal over time.

Clovest: Business project crowdfunding platform; allows individuals to fund up to $5,000 of various business projects and be repaid contributions in 1 – 3 years.

As the founder and CEO of Clovest, I’ve had the privilege of working alongside the other platforms as we foster and grow the local investment movement. Though we all offer different means by which ordinary people can invest in their local communities, there is one overarching outcome that we all seek: bringing businesses and communities closer together through investing. At Clovest, we view our project funding services as merely a means to an end of stronger, more connected, and more engaged local communities. And this isn’t all just for feeling good—as made clear by Shuman, when communities are invested in their local businesses, there are clear gains in employment, wealth, and economic growth. So, how can you, the reader, get involved? Easily! For one, you can learn more about the local investment movement through these blogs and websites:

Cutting Edge Capital blog: features writing on various mechanisms to invest locally and raise capital while being compliant with SEC regulations.

Katovich and Kassan Law blog: topics include SEC compliance for private and public offerings as well as various experimental ways to raise capital.

Business Alliance for Local Living Economies: national advocate of building strong local economies; offers webinars on various topics including community capital.

Localist Champions: subchapters of the BALLE network in your area! Attend events and become a member to support the local business initiatives in your community.

We often get asked by our customers, clients, advisors, and even ourselves, why is it that we insist on using Dwolla to handle our project funding and repayment process? For those that are unfamiliar, Dwolla is a payment network that exclusively uses bank accounts (rather than credit cards) for payments and offers incredibly low transaction fees— free for amounts under $10 and only 25¢ for anything greater than that. As stated on their website, their mission is:

Allow anyone [or anything] connected to the internet to move money quickly, safely & at the lowest cost possible.

Our experience with them has been sublime, to say the least. Beyond being a highly innovative and fast-moving company (often releasing new features every few months), their stellar help documentation, and responsive and knowledgeable support desk, there is a single, overwhelming reason, why they are our preferred payments provider: they save businesses (and us) a great deal of money. Given that our mission is expanding business’ access to credit while not overwhelming them with debt, those savings can make the difference between a business undertaking an expansion project and helping secure the success of their business or staying on the sidelines, held hostage to high interest credit cards or other prohibitively costly financing for small to medium scale projects. With Dwolla, we have been able to build a service that allows businesses to raise money and, most importantly, repay raised funds, at a reasonable cost. And this isn’t all just feel good talk and marketing— we’ve taken a long, hard look at the alternatives (e.g. PayPal), and run the numbers in a variety of scenarios. The results? By using Dwolla for project funding and repayments, businesses save, on average, 4% of their total project cost. Intrigued? Read on for our in-depth analysis or download the excel file and run your own calculations!

Let’s start off with a simple example, a business raises $12,000 from 100 people with the following breakdown:

Pledge Size Pledge Count Amount Raised  $25.00 25  $625.00  $50.00 25  $1,250.00  $75.00 15  $1,125.00  $100.00 15  $1,500.00  $250.00 10  $2,500.00  $500.00 10  $5,000.00 Total 100  $12,000.00

In order to get funded from 100 people, there is an initial upfront cost for transferring the funds. When using Dwolla, who charges only 25¢ on each transaction, the costs come out to:

Pledge Size Pledge Count Transaction Cost (25¢ / Pledge)  $25.00 25  $6.25  $50.00 25  $6.25  $75.00 15  $3.75  $100.00 15  $3.75  $250.00 10  $2.50  $500.00 10  $2.50 Total 100  $25.00

As opposed to PayPal, who charges 2.9% + 30¢ on every transaction, with costs looking like this:

Pledge Size Pledge Count Transaction Cost (2.9% + 30¢ / Pledge)  $25.00 25  $25.63  $50.00 25  $43.75  $75.00 15  $37.13  $100.00 15  $48.00  $250.00 10  $75.50  $500.00 10  $148.00 Total 100  $378.00

Next, we need to calculate the cost of repayment. We offer quarterly repayments to save on administrative overhead and reduce transaction fees for businesses. Here is a table of the repayments we’d be making to each funder on behalf of the business depending on the length of their repayment period and their pledge size:

Repayment Length (quarters) Pledge Size 4 8 12  $25.00  $6.25  $3.13  $2.08  $50.00  $12.50  $6.25  $4.17  $75.00  $18.75  $9.38  $6.25  $100.00  $25.00  $12.50  $8.33  $250.00  $62.50  $31.25  $20.83  $500.00  $125.00  $62.50  $41.67

When using Dwolla to handle these individual repayments, who, again, only charges 25¢ on amounts greater than $10, here is what the transaction fees look like:

Repayment Length (quarters) Pledge Size 4 8 12  $25.00  -  -  -  $50.00  $0.25  -  -  $75.00  $0.25  -  -  $100.00  $0.25  $0.25  -  $250.00  $0.25  $0.25  $0.25  $500.00  $0.25  $0.25  $0.25

As opposed to PayPal, who charges 2% (up to $1.00) on each transaction with their mass payment service, with transaction fees coming out to:

Repayment Length (quarters) Pledge Size 4 8 12  $25.00  $0.13  $0.06  $0.04  $50.00  $0.25  $0.13  $0.08  $75.00  $0.38  $0.19  $0.13  $100.00  $0.50  $0.25  $0.17  $250.00  $1.00  $0.63  $0.42  $500.00  $1.00  $1.00  $0.83

Based on the scenario we ran above (namely the pledge count for each pledge size), these per person transaction fees would lead to the total project repayment cost shown below:

Repayment Length (quarters) Payment Provider 4 8 12  Dwolla  $75.00  $70.00  $60.00  PayPal  $170.00  $220.00  $240.00

If you’ve followed along this far (good for you!), you can probably guess that PayPal is going to be more expensive. But in looking at its cost relative to the total amount raised, it’s truly a stark difference:

Dwolla:

Repayment Length (quarters) 4 8 12 Funding Transaction Fees  $25.00  $25.00  $25.00 Repayment Transaction Fees  $75.00  $70.00  $60.00 Total Cost  $100.00  $95.00  $85.00 As % of Total Raised 0.83% 0.79% 0.71%

PayPal:

Repayment Length (quarters) 4 8 12 Funding Transaction Fees  $378.00  $378.00  $378.00 Repayment Transaction Fees  $170.00  $220.00  $240.00 Total Cost  $548.00  $598.00  $618.00 As % of Total Raised 4.57% 4.98% 5.15%

Clovest is proud to announce partnerships with two D.C. based organizations that have been extremely supportive of the local business scene: ThinkLocalFirst DC  and Union Kitchen. ThinkLocalFirst DC is a non-profit dedicated to working with independent businesses, consumers and policymakers to grow a sustainable, local economy in Washington DC. Their goal is to transform DC’s economy by strengthening the voice of the local business community and implementing programs that increase the sustainability of their business practices. Learn more at: www.thinklocalfirstdc.com. Union Kitchen is a food incubator, kitchen, and office warehouse near Union Station. Housed in a 7,300 sq ft warehouse near Union Station, UK exists to grow and promote small businesses.  Their goal is to build a platform and a megaphone for small businesses by providing a low-cost, low-risk, full-service kitchen for local businesses to grow and establish their operations. Learn more at: www.unionkitchendc.com. These partnerships will help D.C. based businesses expand their access to capital, increase their visibility in the community, and connect with their most dedicated local supporters. We’re excited to be working alongside ThinkLocalFirst and Union Kitchen to foster and promote our mission of investing locally and building communities. Through these partnerships, members of ThinkLocalFirst  and Union Kitchen receive the following benefits:

Discounted application fee when applying to raise funds on Clovest.

Fast tracked review process to quickly list requests, raise funds, and undertake projects.

Personalized training in use of Clovest’s platform and social media tools to effectively connect with potential funders and achieve fundraising success.

Exclusive access to Clovest sponsored events as well as referrals and introductions to other partners within Clovest’s network.