An innovative fundraising approach spearheaded by a Des Moines-based hunger relief group, in collaboration with a San Francisco tech startup, could reshape how organizations raise money.

Eat Greater Des Moines utilized a digital auction platform in April, offering supporters the chance to bid on certificates, labeled as Regenerative Authentication Credits (RACs). These certificates symbolize tangible food rescue and hunger alleviation activities that the organization had already completed.

The allure of RACs lies in their ability to provide backers tangible evidence of completed actions, ensuring that their funds directly impact hunger relief. According to Aubrey Alvarez, Director and Co-Founder of Eat Greater Des Moines, this approach presents their mission in a new dimension. “This isn’t a promise for future actions; it’s proof of the positive changes we’ve already made,” Alvarez remarked.

With each credit exemplifying the organization’s commitment, a $30 bid could secure a donor a certificate representing 60 pounds of rescued food, complete with documentary and visual proof.

This avant-garde auction system is orchestrated by ESG RACs, a tech startup that crafts RACs founded on Environmental, Social, and Governance (ESG) principles. While their collaboration with Eat Greater Des Moines is their inaugural venture in food rescue, they have a history with land rejuvenation projects.

The digital auction bore fruit, raising around $2,000 from approximately 46 bids – funds representing efforts Eat Greater Des Moines had already invested. While the groundwork for this auction was minimal on the part of Eat Greater Des Moines, Alvarez highlighted the pivotal role of the Food Rescue Hero digital platform, which tracked their rescue activities and donations. Without such a system, initiating a RAC auction could be more daunting.

Chris Draper, Co-Founder of ESG RACs, elucidated the company’s core tenets “Basically, permanence of what you’ve done, auditability of what you claimed, and the last piece is being able to monetize or get some of the value out of the good work you’re doing.” Rather than replacing conventional fundraising methods, Draper envisions this system enticing a newer donor base keen on ESG ventures.

The system parallels an initiative by a Mexican food bank that championed carbon credits for rescued food but Draper highlights a fundamental distinction: while establishing a carbon credit demands hefty compliance and auditing fees, ESG RACs merely claim a percentage of auction profits. Draper asserts, “The challenge isn’t about carbon conversion, it’s about addressing human hunger and needs.”

One of the unique facets of RACs is their adaptability, allowing donors, irrespective of their contribution size, to invest in ESG actions. Corporate entities can also make bulk purchases, meeting philanthropic and environmental targets.

Behind the scenes, ESG RACs protocol employs blockchain technology, offering a blend of transparency and trust without jeopardizing privacy. Draper believes this system’s transparent nature can be revolutionary, especially in sectors where there’s a pronounced disconnect between fundraising and its real-world application.

Alvarez echoed this sentiment, emphasizing the need for more transparency in the philanthropic sector. “It’s time to shine a light on how funds are used,” she concluded.