KidPack Direct™

A leader in social justice and children’s issues, Lynn Margherio is the Founder and CEO of Cradles to Crayons (C2C), a national non-profit with operations in Boston, Chicago, and Philadelphia. C2C provides children facing the challenges of poverty with everyday essentials—including clothing, shoes, winter coats, backpacks, and school supplies. The organization has served more than two million children and engaged one million adults and youth in volunteer service since its founding in 2002.

Prior to launching Cradles to Crayons, Lynn was one of the founders and Executive Vice President of the Clinton Foundation’s HIV/AIDS Initiative. She also served in the U.S. Department of Commerce and the White House Domestic Policy Council, as well as in corporate roles for SJS, IKEA, Telesis and Towers Perrin. 

In-kind donations alleviate poverty by freeing up funds recipient families can apply to other basic needs. Unfortunately, processing donated goods is labor- and space-intensive, and donors may feel disconnected from beneficiaries.

Twenty-two million American children are “clothing insecure”—without access to adequate clothing—making them at risk for poor health, bullying, and low self-esteem. Ten million tons of American clothing goes to landfill annually.

KidPack Direct (KPD) re-envisions in-kind donations. A program of C2C, KPD is a peer-to-peer digital platform where families ship outgrown clothing to a specific child from their home. KPD leverages C2C’s extensive insights into children’s clothing needs, and its robust agency partner network. 

Donors in KPD pilots gave it an NPS of 80 and reported feeling immediate impact/ connection to recipient children. Recipients reported donations were excellent quality and correctly sized.

KPD will change how we connect resources in our communities—driving action on a massive scale.

The UN Universal Declaration of Human Rights includes “access to clothing” as a basic human right. 22 million children in the U.S. and hundreds of millions globally do not currently have that right.

Redistribution of resources is not a new concept—nor is donating what you have to support those who don’t. However, most existing donation/redistribution models have significant limitations to keeping up with technological advances and meeting the needs of our increasingly individualized society. They are difficult to scale because of cost and labor involved and are limited in their reach to a specific geography. This leaves many unmet needs for anyone outside the centralized physical location. And, in a transactional model, there is not as much access to developing awareness or empathy toward the community needing the donations—or the emotional connection fostered by the experience of giving directly.

For us, that translates to challenges with cost and logistics of collecting donations from community bins, labor to sort donations, and expensive warehouse real estate. Some donors cleaning out their closets don’t understand/aren’t motivated by the urgency of the need or severity of circumstances for the families their donation goes to, so only a fraction of available supply is harnessed.

KidPack Direct is a responsive web application to connect clothing resources with children who need them. Donors follows these 4 simple steps:

• Pick high-quality, gently used clothing from your closets
• Pack customized outfits for the child you’re matched with
• Ship for delivery to the child in need
• Share your experience online to help serve more children!

“I knew that my donation was directly going to someone and being put to use. I was helping someone immediately.” (–Pilot Participant)

Our platform educates the users about the need, provides guidance about the quality standards to be met, and algorithmically (eventually AI) matches the donor’s items to recipient orders in real-time using qualifiers like size, gender, and zip code. 

Through our existing Social Service Partner Network, we will launch first in Massachusetts, Greater Philadelphia, and Chicagoland. Our excellent reputation and relationships with Partners allow us to expand quickly in new markets like NYC (this summer). We bring deep logistics expertise, a detailed understanding of what items are critical to children’s development and well-being, and a strong set of cultural values that informs and guides our future geographic and product expansion. (We envision books, hygiene items, and school supplies.)  

KidPack Direct will serve US children from birth to age 12 living in low-income and homeless situations—potentially millions. As the technology grows, it can connect resources with communities in any location across the globe.

Children facing poverty frequently live in families who choose between paying for rent, utilities, and food—leaving little to afford the basics children need for a healthy childhood. Through close connections with hundreds of our Service Partners throughout 18 years, we’ve developed an understanding of the experiences of families who struggle financially—from leaving a home behind to flee domestic violence, to losing everything in a fire, to working through three jobs and still not being able to make ends meet.

KidPack Direct takes the work we already do to connect vital essentials to families without access and meets those needs directly and efficiently. The technology’s flexibility to be launched anywhere also naturally expands our network of Service Partners, allowing us to continuously develop our understanding of the needs in the communities we serve.

KidPack Direct alleviates children’s poverty and brings national awareness to Clothing Insecurity—an urgent and hidden crisis impacting millions of US children. It’s simple, convenient, and targeted—millions of children and adults can ship donated goods directly to families who need them most, from the convenience of their own home.

Our traditional business model is powered by large-scale volunteerism by individuals, families, and corporate teams. We serve children across Massachusetts, greater Philadelphia, and Chicagoland. This model has many strengths but is difficult to scale—we estimate that we are serving only 5% of the total addressable market in the U.S. Replication is capital intensive and new markets take 2+ years to open.

In 2019, I approached our National Board about launching a strategic planning process to explore a digital model for national expansion. This February, Bain & Co. generously supported us with a pro-bono project team.

Meanwhile, COVID-19 hit, and we shut down volunteer shifts, effectively cutting off our labor to process donated goods. We watched the urgency of need climb as marginalized communities were hardest hit and families lost jobs. We quickly realized that a direct-to-child donation model was not only important for expansion, it was critical to our ability to deliver our mission in a “new normal” governed by social distancing guidelines. With the Bain team, we developed the new digital model and began piloting it in May.  In June, our National Board approved the strategic plan and an investment in a new technology solution—KidPack Direct.

I’ve dedicated my career to service. My “Aha Moment” for Cradles to Crayons came when I was helping my young niece get dressed. As I was taking things out of her dresser I saw clothes that were too small, yet still had tags on them. It occurred to me that she was growing so fast that there were a lot of things that she was no longer using. This included books she hadn’t read, toys she never played with, and clothes she’d never worn. I had a background in management consulting, so I imagined other drawers and playrooms like my niece’s—a supply and demand problem that I thought I could help solve: Putting items that were no longer being used into the hands of children who could really use them.

This issue was too important not to tackle, so I started Cradles to Crayons. The drive to address the challenges facing children in need has allowed our organization to expand to Philadelphia and Chicago, with two more sites in the planning stages—and now KidPack Direct, which has the potential to be a limitless resource for children by turning compassion into action anywhere.

I’ve launched two mission-driven start-ups already—as founder of Cradles to Crayons and as part of the founding team of the Clinton Foundation HIV/AIDS initiative. During my tenure, both organizations successfully grew and developed reputations for excellence.

My business training, strategic mindset, and passion for making a difference causes me to lean into large societal challenges. In my successes and failures, I have become increasingly adaptable and resilient—I have had projects nearly run out of money, hurricanes and the COVID-19 pandemic have presented unprecedented challenges, and I’ve evolved our organizational structure as we have grown and matured. I enjoy building partnerships, fundraising, and have a strong track record in Board development and management. Most importantly, I value the people who power our mission—our team members, volunteers, and stakeholders, and have built a culture led by critical, mission-driven values.

KidPackDirect is a program of Cradles to Crayons, and benefits from the insights, partnerships, networks and funding of a national nonprofit with deep experience in this issue area. We are well-positioned to successfully create, test, and scale the KidPack Direct model.

“If you can't fly then run, if you can't run then walk, if you can't walk then crawl, but whatever you do you, have to keep moving forward,” is how Dr. Martin Luther King closed a speech in Cleveland in 1967, sharing what everyone must do to be truly free.

COVID-19 was a gut punch to our model. Social distancing keeps volunteers from coming together to help us inspect, sort, and package donations. Millions are out of work and millions more have taken pay cuts, making fundraising more challenging than ever. Demand is the highest we’ve ever seen.

In response, we’re employing Dr. King’s mantra—Whatever you do…keep moving forward.

We’re using the best tools, information, and ideas we have. We’re adapting. Our Operations staff are doing the production work our volunteers used to do. Fundraising and Marketing staff are brainstorming engagement ideas to keep financial support coming in to pay salaries, buy product, and keep the lights on. Community Engagement is finding creative ways to manage product donations. Partner Relations is keeping in touch to respond to shifting needs like demand for diapers. All while we build KidPack Direct to make contactless giving and support an expanded reality.

I understand how to take a large-scale crisis and break it down into accessible, solution-based systems. As a senior member of the health care reform team in the Clinton White House, I focused on tackling critically needed access to then inaccessible health care. I later served as Executive Vice President of the William J. Clinton Foundation's HIV/AIDS Initiative, where I helped launch and build President Clinton's program to assist countries in the developing world to plan and implement large-scale HIV/AIDS care and treatment programs.

By negotiating deep discounts in HIV/AIDS medicines and testing, we unlocked an unprecedented ability to treat and manage this disease at a much more impactful scale.

Our early work paved the way for the now millions of individuals who have been able to seek testing and medication across developing nations and beyond. Additionally, from mid-1997 to mid-1998, I directed the U.S. Commerce Department team that produced The Emerging Digital Economy report, the first U.S. government report to describe and measure the impact of information technology and the Internet to the longest peace-time expansion in history.

KidPack Direct is currently in pilot phase and has served 154 children. In future years, we project to serve the following number of children through KidPack Direct:

• Year 1: 30K
• Year 2: 77K
• Year 3: 148K
• Year 4: 230K
• Year 5: 330K

(By comparison, our traditional, physical model, which we have been operating for 18 years, served 300K children this past fiscal year.)

Our biggest limiter to growth is lack of awareness of KidPack Direct and Cradles to Crayons in cities where we do not currently have a physical location. Our growth trajectory would be significantly accelerated if we had access to the professional development, partnership opportunities, and marketing resources of the Elevate Prize Foundation.

KidPack Direct directly addresses three UN Sustainable Development Goals.

Goal #1: No Poverty. Donate What you Don’t Use

Tangible value is associated with predictably providing KidPacks (clothing for one week) 3x a year to families in need. Each KidPack is estimated at $255 (retail value), and a family receiving three KidPacks annually for one child would realize up to $765 in savings. Clothing donations equal supplemental income as funds are available for other essentials.

Goal #10: Reduced Inequalities. Support the Marginalized and Disadvantaged

COVID-19 hit marginalized and disadvantaged populations the hardest—millions lost jobs. U.S. social safety net organizations were only meant to serve as a backstop to government programs. Food pantry lines show how both are failing. KidPack Direct mobilizes the general public—who are responding more than ever to the urgent needs now surrounding our daily lives. It’s extremely targeted: surplus clothing gets directly to families facing poverty, quickly and efficiently.

Goal #12: Responsible Consumption and Production. Recycle Paper, Plastic, Glass and Aluminum

With 85 percent of textiles going to landfills or being incinerated when they could be reused, KidPack Direct's platform could be a significant tool to keep “waste” out of our waste stream.

The UN’s Lazy Person’s Guide to Saving the World cites four levels of engagement. KidPack Direct can move people on a National, or Global, level. Because it’s digital (and easy/accessible), it takes a current “Level 3” action (more work and dedication) and makes it a “Level 1” action (one that you “do from your couch”). 

Outside of COVID-19, the three biggest barriers that may limit our impact in the coming year are brand awareness, recruiting digital talent, and making shipping seamless and easy for donors.

Brand awareness—Cradles to Crayons does not have brand awareness outside its existing physical footprint. To launch in new markets will require quickly establishing credibility with service agency partners for demand, and corporate, school and other community organizations for supply.  

Digital talent—A small Cradles to Crayons’ team with backgrounds in marketing, project management, strategy and IT are leading the KPD effort through the proof of concept and incubate phases, with the support of an outside product development company and advisors from Bain & Co. To scale KPD nationally will require building a dedicated team and recruiting digital talent. Digital is a new channel for us and we will be competing for talent with better-known and better-resourced companies.  

Shipping—Feedback from KPD pilots flagged the cost of shipping and shipping logistics as a barrier to completing donations. Specific barriers included not having home printers to print mailing labels, no available boxes, and the inconvenience and confusion of having to toggle between our website and UPS’ website.  

In the next 2 to 5 years, we anticipate needing to focus on creating an educational, engaging digital experience for product donors, and building partnerships with retailers and logistics companies to efficiently fill gaps between supply and demand.  

Building brand awareness—We have confidence we will get off to a quick, strong start in our current markets. In early pilots this spring, 40% of KPD pilot participants were new to Cradles to Crayons, and the supply of available clothing donations exceeded the demand. In new cities, our strategy is to pursue partnerships with corporations as a way to build awareness quickly with prospective product donors. We will pilot KPD in NYC this summer with NBC/Universal, Bank of America, and UPS, among other companies. We are tapping our current service agency network and corporate funder network for recommendations of high-impact nonprofit partner agencies to partner with to reach families in greatest need.

Digital talent—We are partnering with a highly regarded product development company on our MVP and are fortunate to have continued support from Bain & Co. to help bolster our digital strategy needs through MVP development.

Shipping—As a first step, we plan to streamline the shipping process and reduce shipment preparation time for donors by integrating UPS APIs into our MVP. We will be testing fundraising messages and approaches as alternatives to asking donors to pay for shipping. Longer term, we will explore partnerships with shipping companies and retailers to further simplify packaging and shipping logistics.   

Our Mission: Cradles to Crayons provides children from birth through age 12, living in homeless or low-income situations, with the essential items they need to thrive—at home, at school, and at play. We supply these items free of charge by engaging and connecting communities.

Our Vision: One day every child will have the essentials they need to feel safe, warm, ready to learn, and valued.

Our Model: Cradles to Crayons has historically relied on a Giving Factory warehouse model whereby:

• New and nearly new children’s items are collected through grassroots community drives and corporate donations.
• Donations are then processed and packaged by volunteers in our warehouse, The Giving Factory®.
• Individually tailored packages from The Giving Factory are distributed to local children—through our collaborative network of diverse service partners.

Going forward, Cradles to Crayons will pursue an omnichannel model, incorporating KidPack Direct as an additional engagement opportunity for the community, and a distribution option for recipient families and partners.

KidPack Direct will be the sole model in cities where we do not have a physical presence. 

The estimated year 1 budget for KidPack Direct is $1.5M.

KidPack Direct is at the perfect point in our development cycle to maximize support from The Elevate Prize. By fall of 2020, we will have our MVP  ready, and we will have tested KidPack Direct in at least four cities in the U.S.

Once our product has been validated and our testing complete, we plan to scale nationally. Receiving the recognition, funding, and access to relationships available through the Elevate Prize Foundation would help ensure our early and ongoing success.

We’re a small team, and digital is new for us. Mentorships, professional development, and access to the Foundation’s network of partners, executives, and decision makers will be key in helping guide our work, make connections, and establish partnerships. We have strong brand awareness within our current communities but are unknown outside of our three Markets. Support with media awareness, visibility and branding will be instrumental to getting the platform launched nationwide.

Despite being a small team, we have an 18-year track record for delivering impact and being an effectively run business. We would dedicate the necessary time and resources to be a strong partner with the Elevate Prize Foundation and the corporations, funders and experts in your network to realize our collective vision of elevating humanity and inspire others to act as engines for social good.