US-based Blackbaud to buy JustGiving for £95m

The charity software provider says this will enhance its fundraising capabilities

JustGiving
JustGiving

The US-based charity software provider Blackbaud has agreed to buy the online donation platform JustGiving for £95m.

Under the agreement, Blackbaud will acquire all of the outstanding equity interests of JustGiving, Blackbaud said in a statement.

JustGiving was co-founded by Anne-Marie Huby and Zarine Kharas in 2001 and has been used to raise more than £3bn in 164 countries for more than 26,000 charities.

Blackbaud said in a statement that it expected to conclude the deal after a regulatory review in the UK. Blackbaud owns products that are considered competitors to JustGiving’s products, including everydayhero, which enables the public to fundraise, donate and volunteer for good causes, and TeamRaiser, a cloud-based peer-to-peer fundraising platform.

Blackbaud said it expected to finance the acquisition using cash in its reserves and borrowings under its existing credit facility. The latest financial accounts for Blackbaud filed in the US show it had total revenues of $730.8m (£574m) in the year to 31 December 2016 and made a gross profit of $391.6m (£307.6m).

JustGiving has invested heavily in its online donation platform in recent years in a bid to stay ahead of its competitors, including BT MyDonate and Virgin Money Giving. It has also diversified into crowdfunding through the launch in 2013 of the platform Yimby.com, which has since rebranded as JustGiving Crowdfunding.

But the company potentially faces competition from organisations such as the social media giant Facebook, which has a created a tool that allows people to donate directly to charities from their Facebook pages.

JustGiving’s latest annual accounts filed with Companies House show that it had a turnover of £24.9m and made a profit of £821,000 in 2016 after taxation. The previous year it made a loss of more than £3.7m on a turnover of £21.6m.

Its latest accounts show it had £5.4m in cash at the bank and in hand in 2016.

Blackbaud said in a statement that the acquisition would enhance its capabilities to "serve both individual donors and non-profits" and expand its existing fundraising capabilities, which include everydayhero and TeamRaiser. It said that the acquisition would add a new "personal crowdfunding capability that can be rolled out in the US and elsewhere", as well as allowing Blackbaud to better serve the UK market.

Blackbaud said that it anticipated the deal would be concluded this year, and the two companies would determine their full integration strategy at that time.

It said in the statement that JustGiving’s staff would become part of Blackbaud’s London-based International Markets Group once the deal was complete.

JustGiving said in a statement: "We are proud to have helped raise over £3bn for good causes since we launched, but there is so much more to do. This is just the beginning. By working with Blackbaud, the world’s largest cloud software company powering non-profits and other social good organisations, we will be able to fulfil our mission of growing the world of giving on an even greater scale and to ensure that no good causes go unfunded."

Mike Gianoni, president and chief executive of Blackbaud, said in a statement: "As a software leader exclusively focused on innovation that drives social good, it’s in our DNA to respond to and anticipate changes in the way people give and connect with causes. This is an exciting next step in our commitment to delivering modern, mobile-first, integrated cloud technology that powers social good."

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