Close to a year ago, Arno, Octave, and I launched Delph.
In February 2022, France was in the final months of its presidential campaign. While our friends and family were becoming increasingly excited about the election, no one was contributing financially to a campaign. We wondered why that was the case and realized that if you wanted to contribute, you only had two options :
Donate. The main benefit of donations was that 100% of what you gave went to the campaigns, and you received a tax deduction by donating. However, once you donated, nothing happened. You only received a “Thank You” email and were probably added to generic email lists sent to donators asking you to contribute more.
Buy merchandise. This was more exciting as, by definition, you got something in return for your contribution, which also benefited the campaign as someone wearing a branded t-shirt or hat helped raise awareness for that campaign/politician. However, for every 20€ you might be spending on the t-shirt, only a portion went to the campaign, given the cost of producing, transporting, and distributing the merchandise. Moreover, when looking at the campaigns’ websites, we noticed that only a third of the candidates offered the option to buy merchandise. These were generally the candidates with the most extensive resources who could afford the upfront cost.
That’s why we came up with Delph, we wanted to use NFTs to make donations more exciting. Delph offered the best of both worlds: the possibility of having something in return for your contribution while being financially attractive to campaigns.
In addition, the NFT could be used to raise awareness and show support for the campaign online. It could also serve as the party’s digital membership card, enabling only the NFT holders to access certain events, discords, etc. While previous political organizations were vertical, with volunteers and donors interacting solely with the political party and campaign, NFTs were a way to bring more horizontality to the structure and increase engagement between donors and supporters.
Before we started developing the idea, we wanted to test it. So, we started contacting anyone we could find by email, Twitter, and LinkedIn. Someone from the Radical Party (the Radical party is France’s oldest party, its name comes from the party’s radical stance against the separation of Church and State), which at the time supported Christiane Taubira, said that he was convinced this was a brilliant idea and that he would talk about it to his boss. That was all we needed to hear. We started building the product and registered the company.
Political donations are very regulated in France (donations above 500 euros can only be made by wire transfer, check, or credit card) and are capped at 7500€ for political parties (per year) and 4 600€ per candidate (per election). We contacted the regulating body, the Commission Nationale des Comptes de Campagne et des Financements Politiques (CNCCFP), to check that our solution was legal. They acknowledged receipt of our email and mentioned they would come back to us, but, to this day, they still haven’t.
In France, the state refunds part of the election’s cost. However, parties have to advance the sum, which they obtain through different means: donations, merchandise, bank loans, and party finances. After the election, if the CNCCFP has validated their expenses, the state refunds the parties depending on whether they have passed certain thresholds:
- Candidates that obtained less than 5% of total votes are refunded 4.75% of their expenses
- Candidates that obtained more than 5% of total votes are refunded 47.5% of their expenses
The important part is that the CNCCFP has to validate the accounts and expenses. This is why campaigns are paranoid about anything that could affect their validation, as there are potentially risking millions of euros. Therefore, not having the explicit green light from the CNCCFP prevented us from going further with many interested political parties.
We continued to pitch the project and had calls with Senators, MPs, chiefs of staff, other high-ranked members of the campaigns, and even a presidential candidate. It’s not easy working on a French Presidential Election while being based in the United States. Our sleep rhythm changed, and at some point, we would naturally wake up in the middle of the night to jump on morning calls in France and respond to emails to get a response the same day in France.
The hard work paid off, and very soon, we were able to get our first candidate onboard, Gaspard Koenig! Mr. Koenig is a French philosopher and founder of the think tank Generation Libre, a rather rare liberal voice in France. Koenig’s team was very responsive, and in less than a week, on February 24, we released our first collection.
For the first time in the world, citizens could buy an NFT to support a presidential candidate
The launch went great, and your responses surpassed our expectations! Here are some examples of the tweets and emails we got after releasing the collection with Gaspard Koenig :
Delph got some press coverage in Capital and their crypto newsletter, 21 Millions, and we were interviewed by Gregory Raymond, one of the leading crypto voices in France (the article is available here). Delph also got coverage in 20 minutes and the more specialized press.
However, February 24 was also the date that Russia invaded Ukraine. While launching what we had been working on for the past three weeks appeared as a relief, it didn’t feel right selling NFTs for a French political campaign while there was an ongoing war in continental Europe.
Therefore, we decided to switch our focus to Ukraine and use our product to raise funds and awareness for nonprofits operating there. Contacting Ukrainian NGOs proved much harder than expected, as they were being flooded with messages, calls, and checks.
Eventually, we were able to collaborate with a Franco-Ukrainian nonprofit, Aide Médicale Caritative France-Ukraine, and raised a few hundred euros for them. We also collaborated with Unique Country, a free art studio for Internally displaced children in Western Ukraine, and launched an NFT collection (displayed below) designed by Olga, a drawing teacher in a rural city school.
We had always considered entering the US political market in preparation for the midterms and the primaries. However, after discussions with multiple candidates, chiefs of staff, and American lawyers, we realized the legal uncertainty, cost, and potential liability were too great to risk pursuing.
Our first pivot had been nonprofits, and we believed this was the next logical step for Delph. For months we talked to NGOs in France, the United States, Madagascar, Mauritius, the Netherlands, and more. The vast majority of them were very excited by the technology, and the Ukrainian war had proven that NFTs could be a significant source of income for nonprofits. However, navigating the space proved slow, difficult, and risky (our lawyers were never able to guarantee that our product did not expose us to any liability).
After exploring many eventual pivots, such as more generalized crypto fundraising platform, cross-border tax-deductible crypto donations, and decentralized autonomous nonprofits, we realized we were focusing too much on adapting and translating existing fundraising methods to the web3, with all the additional legal issues and constraints that went with it. Also, it seems that along the way, we became more influenced by exterior voices, which focused more on the business side and lost sight of our initial objective: to provide the most social good. Another consequence was that as the months passed, though our personal and professional relationship remained strong, we were having less fun.
Thus, sadly, we weren’t able to successfully pivot and implement our vision of revolutionizing the political and nonprofit fundraising space.
Just like most startups, the journey was full of ups and downs, which included exchanging and receiving advice from amazing people every week, discussions with VCs, a Y Combinator interview with Michael Seibel, being incubated and funded by Yale, a ban from Stripe, a Delph-sponsored afterparty for NFT.NYC, computer crashes two days before the launch, deep dives into the French electoral code and the Polygon blockchain, and much much more. But every adventure has to end….
Thank you for your help and support throughout this insane journey!
The Delph Team
Arno, Octave & Simon