Click on the web sites of any number of charities, from Mothers Against Drunk Driving to MusiCounts, and you may notice a surprising shift: a growing number are moving into iTune's territory, raising money by selling music downloads.

The man behind the change is Eduardo Alvarez, a 42-year old entrepreneur, who also co-owns a Queen Street gym, and is planning on setting up another in Toronto's downtown. Alvarez, with business partner and fellow Torontonian Justin McCartney, may seem unlikely candidates to shake-up the world of fundraising, as his gym business interests have little relation to the non-profit or music sector. However, Alvarez became aware that our schools need help (the Toronto District School Board has a $17 million deficit), and that the old fundraising methods were inefficient and promoting unhealthy lifestyles.

Since launching his business venture in September 2009, he has expanded the service, FundTunes, across Canada, joining forces with 40 charities and 10 schools. He spoke to Yonge Street Media from his home in Queen Street West about how it all came about.  


Alexandra Shimo: You must have talked to a lot of charities and schools. What sort of situation are they in?

Eduardo Alvarez: The Toronto District School Board is facing a $17 million deficit. And there's been a promise to raise high school teacher salaries by 12.55 percent over the next four years, which limits growth in other areas. And so we see lots of schools relying on kids going out and selling food and goods to support activities such as music and sports.


And why is this sort of fundraising a problem?

Typically schools fundraise by selling candy, like cookie dough, chocolate, etc. And yet we know that childhood obesity is a growing problem, and we know that children should be eating less trans fats. So we wanted a risk-free solution that wouldn't undermine their healthy eating message.


Can you explain how your model raises money for schools and charities?

Essentially FundTunes is a service that allows charities to sell music downloads as gifts. Technically, charities could approach the music labels themselves, but they'd have to buy in bulk for any wholesale discounts. And most charities don't want to carry large music inventories � it means financial risk. So FundTunes acts as the middleman, so the charity can sell music and still make money.  

How much does it cost?

It costs $7.29 for five songs, including taxes and $14.57 for 10 songs. For the five song bundle, $1.50 goers to charity, or $3.00 for the 10 song bundle.

Have any big name charities come on board?

We started in September 2009, and since then 40 charities have come on board, including Mothers Against Drunk Driving the Canadian Cancer Society, Canadian Athletes Now, Schizophrenia Society of Canada. Ten schools from across Canada have also signed up for this. We're reaching out and offering this service to them, but they're also approaching us.

Where do you buy the music from?

We buy our inventory from Universal Music Canada, which is the world's and Canada's largest, with a 39 percent share of the Canadian market. They have some of the biggest names in Canadian music, such as Hedley, Sam Roberts, The Tragically Hip, Diana Krall, Nelly Furtado, Shania Twain and many others.

And how did you come up with the idea?

A few charities had already told Universal Music Canada that they wanted to be able to sell music downloads, so it was an idea that people were already thinking about. The idea wasn't that original, it was more a matter of making it happen.

What were the biggest challenges of setting up the business?

It sounds so simple, but it's been a challenge getting people to understand! Charities want to know how much it costs; and they're surprised when they find out that it doesn't cost anything. And you'd be surprised how many of them don't understand concepts like digital music or e-greeting cards; these things aren't the easiest things to explain!  

Where are you taking the business next?

We're currently reaching out to business and media partners such as Canwest (www.canwestglobal.com). We're offering them e-cards with music-downloads, where a portion goes towards the charity of choice. We're trying to replace the traditional company swag, which costs a lot to make and isn't very eco-friendly.

I understand that you also co-own a boutique gym in Queen Street West. How do you manage several businesses at the same time?

I'm a passionate believer in the E-Myth, a management philosophy for small business entrepreneurs.  It's not like I'm the world's most successful manager or whatever, but this book has really helped a lot of people.  The founder of Lululemon, Chip Wilson, has even talked  about how it helped him franchise his business. It's funny because it actually talks about how to make yourself less relevant � how to set up a business and procedures so that you don't have to be as hands on. I think that a lot of people feel they need to work 24-hours per day to be successful, but I believe you need to learn not to micromanage, how to let-go and be more strategic.


Alexandra Shimo is an author and journalist based on the Ossington strip. She has lived in several cities, including London, New York and  Washington D.C. and is now proud to call the T-dot her home.