Flipcause bankruptcy: What nonprofits can do right now

_{⚖️ Disclaimer: This article is for informational purposes only and does not constitute legal advice. If your organization has funds locked in Flipcause, consult with legal counsel or your state regulator for guidance tailored to your specific situation.}

_{Last updated: May 2026 — This article is being updated as new information becomes available regarding Flipcause's bankruptcy proceedings and liquidation.}

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It's every nonprofit's worst nightmare.

In early fall of 2025, news reports began to emerge of Flipcause customers facing months-long payout delays and little to no communications from their fundraising platform.

By mid-November, California's Attorney General issued a cease-and-desist order to the company for allegedly holding onto donor funds without transparency or consent, raising serious questions about Flipcause's future and creating major implications for its customers, many of whom were still anxiously awaiting their funds.

In response, Givebutter created the $1M Givebutter Cares Fund, offering $500 donations to support nonprofit Flipcause customers from the past year—no ongoing commitment required.

Keep reading for everything changemakers need to know about the latest developments in the Flipcause situation and how nonprofits can ensure their funds are safe and secure when choosing a fundraising platform. Because the case has now moved from Chapter 11 restructuring to Chapter 7 liquidation, the situation has materially changed for nonprofits still attempting to recover funds.

What happened with Flipcause

Based in Oakland, CA, Flipcause was founded in 2012 with a mission to "empower small nonprofits to better engage their communities and fund their causes, regardless of budget or technical ability." The company's website claimed in 2025 that 5,000 nonprofits had raised more than $1B on the platform.

Beginning in May of 2025, nonprofit Flipcause customers took to Reddit to share their frustration about not being able to access their funds or reach customer service for adequate support.

"Our nonprofit switched from them in April 2025, and they not only are withholding more than $180,000 in donations, Flipcause also refused to allow the transfer of our recurring donors to our new fundraising platform, a courtesy that every other platform will provide." — Flipcause user

For cash-strapped community groups already reeling from budget cuts, Flipcause payout delays "have led to missed payrolls, staff layoffs, canceled programs, and rising anxiety", reported Oakland Voices.

In August 2025, the Better Business Bureau (BBB) gave Flipcause an "F" rating, citing a pattern of complaints, delayed funds, and a lack of responsiveness. The situation escalated from there.

The full Flipcause timeline of events

• September 2025: Oakland Voices begins reporting on delayed payouts totaling hundreds of thousands of dollars for local nonprofits, reporting that the platform is not registered to collect donations in California.
• October 2025: Latino Medical Student Association-Northeast files a lawsuit against Flipcause, alleging the company withheld donations and defrauded organizations.
• November 14, 2025: CA Attorney General issues a cease-and-desist, requiring Flipcause to shut down operations and "transfer all of its cash or cash equivalent assets into a blocked bank account" by December 12, 2025.
• November 21, 2025: Givebutter launches a $1M relief fund for nonprofits affected by Flipcause.
• December 4, 2025: Stripe terminates service for Flipcause, freezing approximately $2.2M in funds.
• December 5, 2025: 29 organizations from 18 states join the federal class-action lawsuit against Flipcause.
• December 19, 2025: Flipcause files for Chapter 11 bankruptcy, revealing the company owed $29M to more than 3k nonprofit organizations across the country—while its executives paid themselves millions.
• March 18, 2026: Canada-based company Software4Nonprofits purchases Flipcause for $400K, and by March 30, reinstates all of the platform's features and campaigns as the DONATION Pro plan under its own branding.
• April 28, 2026: A judge converts the Chapter 11 bankruptcy case to a Chapter 7 liquidation case, meaning customers with funds still locked in Flipcause will no longer be able to file claims through bankruptcy proceedings.

Flipcause impact by the numbers

Bankruptcy filings revealed the true scope of the crisis, with thousands of nonprofits left in limbo and tens of millions in charitable funds tied up as the company unraveled. The numbers below highlight just how widespread the impact has been:

• 3K+ nonprofits listed as unsecured creditors
• $29M owed to nonprofits in missing charitable assets
• $1.2M largest single amount owed to one organization
• $30M+ in total liabilities
• $3.83M paid to CEO and family entities before filing for bankruptcy

What Flipcause customers should do now

While the Software4Nonprofits' acquisition means that Flipcause customers may now have access to their fundraising campaigns, websites, donor records, and transaction data, they cannot access any funds held in their Flipcause accounts.

With liquidation of assets moving forward and several lawsuits pending, much remains unknown about whether or how funds will be returned to nonprofits. As unsecured creditors,

Nonprofits will only receive payment after claims from secured creditors, such as bankruptcy attorneys and investors, are settled.

If you're one of the thousands of organizations with funds tied up in Flipcause, be sure to take the following steps:

1. Document important information

As recommended by the California AG in guidance from December 2025, it's critical to download or take screenshots of remaining Flipcause balances and correspondence for any consumer complaints, future audits, or regulatory inquiries. Additionally, download all donor, transaction, and payout records to help preserve historical information.

2. Find legal support

An attorney can help you stay informed about the new Chapter 7 trustee and the liquidation process. Eisenberg & Baum, LLP, the firm leading the class-action lawsuit on behalf of dozens of organizations, may be a good place to start.

3. Communicate with your donors

Transparency is important to retain trust with your community. Givebutter's rapid-response communication template includes sample emails you can adjust to meet your needs, including one to notify recurring donors that you'll be moving to a different donation platform.

Free templates

Download free rapid response outreach email templates →

Choosing your next platform: 4 questions to ask

It's critical to find a platform rooted in trust and transparency that can keep your mission moving forward. As you compare your options for fundraising and donor management software, consider these commonly requested features to help you feel confident in your decision:

• Reliable, timely payouts
• Strong recurring donation tools
• Integrated CRM and fundraising
• Transparent reporting
• Accessible, human support

Regardless of which platform you choose, you deserve transparent access to every dollar entrusted to your organization.

Be sure to ask these four questions before moving your funds anywhere (and see Givebutter's response to each as an example):

1. How quickly are funds paid out?

Givebutter Wallet allows for same-business-day payouts to your bank account, and funds not stored in Wallet are transferred in a standard 3-5 business day window. All donations become available for withdrawal on a rolling 48-72-hour basis after a donation is made.

2. Where exactly will my money be held?

Funds in Givebutter Wallet are held at Fifth Third Bank, a top-15, publicly traded bank. Standard payout funds are held in our secure payment processor, Stripe.

3. Are any of my funds eligible for FDIC insurance?

Yes. Givebutter Wallet funds are eligible for FDIC pass-through insurance up to $250K.

4. Are you in compliance with CA-AB 488?

Yes. Givebutter is registered as a Charitable Fundraising Platform with the state of California.

For added security and peace of mind, you can also ask your platform if its financials are regularly audited. Givebutter's financials, for example, undergo annual independent external audits, which are then approved by our Board of Directors.

The bottom line is: For nonprofits evaluating new fundraising infrastructure, payout transparency and regulatory compliance have become significantly more important considerations. At Givebutter, every dollar you raise is always available, always transparent, and always yours. The way it should be.

Considering Givebutter?

See how Givebutter's features stack up to Flipcause (now Software4Nonprofits) →

Givebutter Cares Fund for Flipcause users

We also know that actions speak louder than words:

Givebutter's $1M Givebutter Cares Fund offers $500 to every 501(c) nonprofit that has been a Flipcause customer since the beginning of 2025.

To receive a $500 donation, eligible organizations must create a free Givebutter account, verify their nonprofit status, and set Givebutter Wallet as their default payout option.

‍👉 Apply here to start the process →

📝 Please note: This donation comes with no long-term commitment or requirement for any organization to stay on Givebutter. We simply want to help nonprofits get back on their feet. Our goal is to ensure that this money reaches the intended recipients and that we can donate up to $1M in funds in the most scalable, secure, and efficient manner possible.

If you do want to try out the platform, Givebutter's core fundraising and donor management features are always free to use, and the Givebutter Guarantee ensures that you keep every dollar you raise, with no platform or processing fees.

Apply today

Learn more about the Givebutter Cares Fund & apply in minutes →

Restoring trust in your fundraising platform

Nonprofits trust their fundraising partners to be good stewards of their funds, their data, and their donor relationships.

Your mission deserves stability, transparency, and trust. Here at Givebutter, we take our role in your mission seriously. Our support team is here 24/7 to provide clear, transparent answers to any questions you may have.

Here's to a future where trust is not just restored, but strengthened, together.

Frequently asked questions about Flipcause

Is Flipcause going out of business?

Yes. Flipcause has filed for Chapter 7 liquidation, and its assets were sold to Software4Nonprofits in March, 2026.

Why did Flipcause shut down?

Flipcause withheld donations from nonprofits and was not registered to collect donations in the state of California. After multiple consumer complaints, the California Attorney General issued a cease-and-desist order in November 2025, and in December, the company filed for bankruptcy.

How do I get my money from Flipcause?

Because the company is now in liquidation, nonprofits are no longer able to file claims through bankruptcy proceedings. Organizations will need to contact the new Chapter 7 trustee about the liquidation of assets.

Is there a class action lawsuit against Flipcause?

Yes, Eisenberg & Baum, LLP, is representing multiple nonprofits in a federal class-action lawsuit against Flipcause.

What are alternatives to Flipcause?

Givebutter is a strong alternative to Flipcause, offering a free donation platform with dozens of modern fundraising tools, a CRM, and engagement features. Plus, Givebutter is offering former Flipcause customers $500 to support their transition, no long-term commitment required.

Who is the CEO of Flipcause?

Emerson Rayvn is the founder and former Executive Chairman of Flipcause. He is currently being personally sued by private equity firm Grand Avenue Advisors, an investor in Flipcause.