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Mogl wants you to fight hunger by eating.
The startup released a revamped version of its mobile app and business model today that lets you earn money to donate to food banks, just by eating at restaurants. That’s right, the more you eat out, the more meals are given to people dealing with hunger.
“50 million Americans are meal insecure, and one in five kids in America faces hunger,” founder Jon Carder said in an interview with VentureBeat. We are not doing a good job taking care of this problem because there is enough food in America to feed everyone. Instead of asking people to donate food or checks, we give them the opportunity to give back every time they eat out.”
Mogl’s goal is that no one suffers from hunger in their cities. The company first launched its restaurant loyalty program in 2011 with a one-to-one model, along the lines of TOMS shoes. Every time someone spent $20 at a participating restaurant, Mogl donated a meal to a food bank in that city.
Carder said this model worked well — Mogl members have spent more than $30 million, and the startup donated over 550,000 meals to food banks.
But he felt this wasn’t dramatic enough to make a real dent in the problem.
Now Mogl users earn 10% cash back when they eat at a participating restaurant. You sign up by linking your credit/debit cards to Mogl. When you eat at a participating restaurant and pay with that card, the app prompts you to decide how much of that cash you want to keep for yourself or donate. Carder said every 20 cents donated equals one meal.
“I think restaurants really care about the hunger problem because it’s what they do for a living,” Carder said. “Restaurant owners are passionate about feeding people, and food banks are doing a great job of doing it,” Carder said. “Parents that lost their jobs or single moms who can’t afford all three meals a day can go to food banks and pick up food to feed their families.”
Mogl’s app also has gamification features where you can track how much you have donated, compete with your friends on cash-back earned and meals donated, and “win the jackpot” if you are the biggest patron of a certain location, a la Foursquare.
Mogl also built a “hunger tracker” using government data on how many meals are required in that city every month. Users can see in the app how much they have contributed, and how many more meals are needed to curb hunger.
“We would love it if everyone in the world wanted to give for givings-sake, but there have to be other psychological motivators,” Carder said.” It has to be fun and make people feel good about themselves too. Different people are motivated by different things. Some people may just want Mogl to automatically run in the background, while others may want to really participate.”
Loyalty programs are an important marketing tactic for restaurants because they help attract new customers and keep old customers coming back. There are many restaurant loyalty startups out there, such as Yub, Belly, FiveStars, and LevelUp, but Carder said these are basically just glorified punch card systems that require effort on the part of businesses and the consumers. They also don’t have a social mission.
With Mogl, restaurants don’t have to download any software or use a distinct point-of-sale system. They sign up and Mogl takes care of the rest.
Mogl claims its users spend an average of 44.9% more in restaurants when they’re using the app than when they’re not. And restaurants can see their monthly revenue go up by as much as 70 percent and their annual profits increase by $10,000 when they partner with Mogl, the company says.
Mogl is currently active in six markets — San Francisco, San Diego, Ventura County, Los Angeles, Orange County, and Phoenix. It works with thousands of restaurants and is now making a big push for national expansion. The strategy is to launch in any city as soon as 100 members and 5 restaurants join, relying on users to dictate where Mogl goes and when.
Carder is a serial entrepreneur who sold his company ClientShop in 2006 for an undisclosed (but significant) amount of money. He decided to take this money and head to Indonesia for a life of leisure and surfing. This got boring fast, and Carder said he realized he wanted to channel his passion for building companies into doing a little good in the world.
The startup raised $20 million in venture capital from Sigma Partners, Austin Ventures, Avalon, Correlation Ventures, and Silicon Valley Bank. Mogl is based in San Diego.