These 21-year-old dropouts raised $2M to build Givefront, a fintech for nonprofits

In the past decade, the financial technology landscape has transformed how businesses in the U.S. handle their finances, with companies like Brex and Ramp leading the charge. However, the nonprofit sector has largely been overlooked in this wave of innovation. Enter Givefront, a startup co-founded by 21-year-old Harvard dropout Matt Tengtrakool and UC Berkeley's Aidan Sunbury, which is set to change the game for nonprofits. Givefront is developing a financial platform specifically designed for organizations such as food banks, animal rescues, NGOs, churches, and homeowner associations. Despite contributing approximately 6% to the U.S. GDP and trillions to the economy each year, many nonprofits still depend on outdated financial tools. The founders of Givefront believe that implementing modern spend management and compliance solutions tailored to nonprofit needs can lead to significant operational efficiencies. Before launching Givefront, Tengtrakool had experience with a microloan aggregation startup in Nigeria and worked closely with various nonprofits while studying computer science and statistics at Harvard. His involvement in these organizations allowed him to witness firsthand the financial challenges they face, including stringent regulatory and reporting demands coupled with inadequate financial tools. "I’ve always been intrigued by financial systems, and this venture aligns perfectly with that passion," Tengtrakool shared with TechCrunch. Initially, Tengtrakool developed Givefront to address the internal financial management issues of the nonprofits he worked with, but the concept quickly evolved to encompass a broader range of local nonprofits nationwide. Now, Givefront focuses on creating a comprehensive financial platform for about 1.9 million registered nonprofits in the U.S. After joining Y Combinator in Winter 2024, the team aimed to provide a wide array of banking and accounting services. However, they soon recognized that persuading nonprofits to change their accounting or banking relationships was a lengthy process, prompting a shift towards card and spend management solutions. "It's much simpler to encourage an organization to switch their payment card than to overhaul their entire accounting system," Tengtrakool explained. While Givefront offers features akin to those of corporate spend management platforms, its unique focus on nonprofits distinguishes it in the market. Nonprofits contend with specific challenges, including managing restricted and unrestricted grants, tracking volunteer expenses, and adhering to IRS reporting requirements. Traditional nonprofit systems like Blackbaud and Sage often lack the real-time controls and integrations that modern organizations demand. Rather than replacing these legacy systems, Givefront integrates seamlessly with them, offering nonprofit-specific features such as spend controls, receipt capture for audits, grant-based budgeting, and automated reporting. "The workflows we’re developing are tailored to fit the specific needs of this sector," Tengtrakool noted, emphasizing the significant improvements over conventional tools. Revenue for Givefront comes from card interchange fees and subscriptions linked to its bill payment feature. The company is also planning to diversify its revenue streams by introducing additional services like payroll, banking, budgeting, and investment management. Since the launch of its card services six months ago, Givefront has successfully brought on board hundreds of organizations, experiencing over 200% month-over-month growth in both revenue and transaction volume. The goal is to support approximately 1,000 nonprofits by year-end, with an ambitious target of reaching 5,000 by mid-next year. The youthful energy of the team, which includes a 17-year-old founding engineer, has presented both opportunities and challenges. While some nonprofit leaders find their age refreshing, others express hesitation about entrusting financial operations to such a young team. Churches and religious organizations have shown the highest adoption rates, as many rely on volunteers for financial management, and Givefront's automation significantly eases their workloads. Recently, the startup secured a $2 million funding round led by Script Capital, with additional investments from Y Combinator, C3 Ventures, and various angel investors, including CEOs from Chariot and Wealthfront. This seed funding will enable Givefront to expand its distribution, grow its team, and enhance its card and bill payment offerings.