With Funds Tight, College Students Get Creative

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Matt Kopko explains the site is similar to those where, say, a person runs a marathon and solicits support for charity. "You get people to pledge toward a [charitable] goal, and everyone benefits."

Unlike GreenNote and Fynanz, GradeFund contributions are gifts, not loans, which makes the site especially attractive to cash-starved students. By earlier this month, almost 6,000 people had signed up, 20% of whom are donors, according to the Kopkos. And as student loan funds evaporate, they predict big growth.

Michael Beck, a freshman at the University of Michigan who created one of GradeFund's first student profiles, says he was initially skeptical. After all, by skipping the site altogether, and just arranging a similar reward system with friends and family, he would avoid the 5% transaction fee (which the Kopkos charge to cover overhead costs and eventually make a profit). However, he says, a site like GradeFund makes the process more formal.

"Everything's spelled out in writing, and you can see all of your donations," he explains. "It's not just like, 'Hey, Mom, can you promise to give me money?'"

NOT A SURE BET

Of course, creative financing can fail. Earlier this year, Brendan Baker, came up with a "ridiculous" plan to help raise the $90,000 he needed to attend the University of Oxford's Said Business School: His Web site, 3bucksforbrendan.com, sought $3 donations from 30,000 strangers.

Confidence notwithstanding, Baker could only raise $11,000—12% of his ultimate goal—and he had to forgo admission to Oxford. —I've been amazed and humbled by all the support,— Baker wrote on his Web site in September, before donating the money to two nonprofits: Engineers Without Borders and Medecins Sans Frontières. On his Web site, he blogs that he still plans to attend Oxford.

To avoid a similar fate and cover his bases if his e-mail plea falls short, Max Stephenson registered with GradeFund, where he was recently named a site spokesperson. He also plans to get a summer job that offers more traditional income, he says.

And if he still falls short? He laughs. "I'll just think of something more creative."

Macsai is a writer for BusinessWeek.