Swellr, Where Deals Support Education

The premise for co-founder Nathan Rothstein's new start-up, "Swellr," is simple.

"We saw a general trend toward people wanting to make their purchases matter more, to have a more personal connection with businesses," said Rothstein, a 2002 graduate of .

Swellr, which launched today, allows consumers to do just that.

The site starts with two lists: 1) local businesses that have made a pledge to donate a percentage of profits to 2) a list of local education projects in need of funding.

When a customer makes a purchase on Swellr, he or she chooses which local education project the money will go to. So far, Swellr has 15 local businesses lined up in Cambridge and Somerville, as well as a handful of education projects. 

An example: Someone goes on Swellr.com, and buys a "good certificate," or voucher --not a coupon, which makes it different from daily deal titan Groupon or Patch's Daily Deals -- to Fire and Ice in Cambridge. Fire and Ice, in turn, donates anywhere from 5 to 25 percent of its profits to King Open School's annual trip to Washington D.C.

"Businesses like the idea that they can see exactly how their donations affect people then coming into their store," Rothstein said. "We let the citizens choose where they want their money to go, and the business decides the terms of the agreement."

Swellr takes a 10 percent transaction fee from the businesses involved, which even with the 5-25 percent education donation still adds up to far less than Groupon's 50 percent transaction fee, though the hyperlocal factor will likely mean a smaller total revenue pool.

Rothstein, who moved to Lexington when he was in the fifth grade and attended before LHS, is excited for the project to finally launch. 

"It's nerve-racking when you don't know if it's going to work out, but we spent a lot of time listening to people's problems, and we molded Swellr to make easier what people were already doing," Rothstein said.

That Swellr has made it this far shows that Rothstein is not the only one excited. The start-up was named one of 125 finalists earlier this year in the MassChallenge competition that started with 900 start-ups. 

Reviews pre-launch have also been positive.

"One of the best parts of Swellr is the way it encourages businesses to increase the percentage they donate," wrote Alex Goldmark in Good Magazine in late June. "It harnesses a little of that competitive spirit inherent in business ...to make companies outdo each other with their generosity."

The next round of MassChallenge cuts happens in October, when Rothstein and his co-founders will present Swellr to a group of investors. By that point Rothstein hopes to have expanded to Lexington, where he has a bit of firsthand experience with the education system.

"My sister is going to be a junior at LHS," said Rothstein, "And I've already started meeting with people in Lexington to see if this is something we can get started on here quickly."