Crowded’s Path to Enterprise: Transitioning from College Groups to Major Nonprofits

Crowded’s Path to Enterprise: Transitioning from College Groups to Major Nonprofits

Scaling from small organizations to enterprise clients is a transition that many B2B startups struggle to navigate. In a recent episode of Category Visionaries, Daniel Grunstein revealed how Crowded evolved from serving college groups to becoming a platform for major nonprofit institutions.

Finding the Enterprise Hook

While Crowded began by solving payment processing problems for college organizations, they discovered their true enterprise value proposition lay elsewhere. As Daniel explains, these larger organizations faced a critical challenge: “The consequences of not doing those things [compliance] are massive. They get billed and they can get sent to bill by the IRS. The organization and all its great efforts can be shut down overnight.”

This insight led to a crucial realization: compliance handling, not just banking features, would be their key to enterprise success.

Building for Scale

The transition required significant product evolution. Daniel describes their current enterprise offering: “We take banking and we make it like a completely tailored experience to the end user and their application or use case. So it doesn’t look like any other digital bank.”

For enterprise clients, this customization became crucial. “These organizations, a time poor and cost poor, they’re really cash poor, so they don’t really have the resources or understanding or even the need to manage three systems,” Daniel notes, explaining why their integrated approach resonates with larger organizations.

Evolving the Sales Strategy

Their approach to market expansion has been methodical. “We did a lot of experimentation last year. We went to literally every conference that existed in the US, which burnt a lot of cash, but loads a lot of lessons,” Daniel shares.

This led to a more focused strategy: “We have this year decided to focus on three big conferences and make a splash there.” The team recognized that in the nonprofit sector, presence at key events isn’t just about marketing – it’s about demonstrating commitment to the community.

Product Evolution for Enterprise

To serve larger organizations effectively, Crowded had to develop new capabilities. Daniel explains one key feature: “We’ve started to do customizable account structures for large organizations, particularly universities. So the ability for them to have the head office having sort of a parent count and then sub accounts that have like a clear internal reporting structure.”

This flexibility was crucial because, as Daniel notes, they needed to “fit in with a different university policy or a different foundation policy because they’re all different.”

Market Education Challenges

The transition wasn’t without challenges. Even with their enhanced offering, they faced resistance from traditional banking relationships. Daniel explains: “People, even with that portion of their operations, are not wary, but it’s something new for them to move that away from the big bank. So there’s a bit of sort of like education that needs to be done there.”

Measuring Success

Their progress in market penetration varies by segment. Daniel shares: “We’re much stronger, for example, in the college space than we are in the k through twelve space. I’d say in the college space. Like, yeah, maybe ten to 15% would definitely have heard of us. Maybe about 1% would be using us, or a bit less than that.”

Looking Forward

The transition to enterprise continues to evolve. As Daniel describes their vision: “The product is not far away from it, from being this end to end management platform for nonprofit treasurers and administrators. And I think that we’re well on the way to being that.”

Key Lessons for Founders

Crowded’s enterprise transition offers several valuable insights for B2B founders:

1. Find your true differentiation for enterprise clients
2. Be willing to customize your product for enterprise needs
3. Focus your event strategy on key industry gatherings
4. Invest in features that support complex organizational structures
5. Be patient with the education process when displacing incumbent solutions

For founders navigating their own transition to enterprise, Crowded’s journey demonstrates the importance of maintaining focus while evolving your product and go-to-market strategy. Success in enterprise sales isn’t just about having more features – it’s about deeply understanding and solving the unique challenges that larger organizations face.