What matters about mobile?


(Photo by nedrichards. Flickr, Creative Commons)

So here we are, several weeks after text donations crossed from cutting edge to common place. I've been interviewed more times than I can count on what matters about text giving, and the real experts on social media and social good (Beth Kanter, Katrin Verclas, Allison Fine, Holly Ross, Geoff Livingston) have written, been quoted, held panel discussions, and written handbooks on the subject.

After all this good discussion, I've come to think that the question should not be "to text or not" but "what matters about mobile?" From the point of view of nonprofits, mobile gives them the opportunity to add a new location. Essentially, every organization in the world just got the opportunity to expand their footprint to include their current location and every mobile phone.

It may be like winning the location lottery. An organization can be where they are now and also on every one's mobile phones.* That might be through a text short code. It might be through an App. It might be by being on FourSquare or other geolocation services. Maybe NPOs should start tagging their service delivery areas on Google Maps? The possibilities are many - far more than "just" a question of getting text donation enabled. Of course, like winning the lottery, organization now have to make choices they never had to worry about before.

Mobile matters. It matters as a news source and distribution channel. It matters as a payment system. It matters as a marketing platform. It matters as an organizing tool. Yes, I know the "to text donate or not question" is complicated in and of itself. Sadly, it is also too simple a question.

*(Noting that more and more nonprofits are being born on mobile phones - e.g., Ushahidi, The Extraordinaries)

Industry Forecast: Philanthropy and Social Investing: Blueprint 2010

monograph

Buy this book on Lulu.


Blueprint Research & Design, the company I founded, is thrilled to release the first ever independent annual industry analysis for philanthropy and social investing. "Philanthropy and Social Investing: Blueprint 2010" was distributed in partnership with SSIR starting in December 2009 through national donor advised funds, private banks, wealth managers, community and private foundations, philanthropy associations, and large nonprofits. It is now available to everyone in printed form and formatted for the Kindle. Bulk copies are available at discounted rates.


Here's what some of the early readers had to say:

"Whether you read it and weep, or read it and cheer, Blueprint 2010 is a riveting and illuminating guide to the realities and implications of trends in the world of philanthropy happening right now. This is the perfect relevance conversation starter for foundation staffs and boards. Thanks for the sector-wide reality check!"
Doug Kridler, CEO, The Columbus Foundation
“I learned more in reading Bernholz’s Blueprint 2010 than I have in attending entire conferences on these topics. It elegantly, accessibly and succinctly sums up the most important trends in philanthropy. Funders and nonprofits: read it now to better navigate the messy year ahead.”
Katya Andresen, COO, Network for Good

The monograph results from the countless requests we get for speaking engagements and to "turn the blog into a book." We will be releasing new versions each year in December with practical, forward looking advice and insights about the year to come. Plan now to pre-order bulk copies of Blueprint 2011 for your board members, major donors, and community partners.

We are thrilled to have partnered with Stanford Social Innovation Review on this inaugural issue. Subscribers to SSIR can get a special discount on copies through the link at the bottom of the SSIR website.

Background about Blueprint and who the folks are behind the Blueprint.

Kindle Version - click here.

Hard Copies - click here.

SSIR Special Offer - click here. (Scroll down to bottom of home page for special offer)

Read it. Tell your friends, colleagues, funders, board members, and grantees. And, if you like it enough to blurb it, tell me - I'll post the best blurbs on the blog!



Buzzword 2010.2 "Sector Agnostic"

I declared Apps the first buzzword of 2010 a few weeks ago. Now we've got buzzword 2010.2 - sector agnostic.

I didn't coin this one. I give Ralph Smith of the Annie E. Casey Foundation credit for that, and it seems this blogger agrees. Smith used the term in a Nonprofit Quarterly article by Rick Cohen - here's the quote:

"Foundation philanthropy is increasingly sector agnostic. Many of us believe that foundation philanthropy is at its best when its resources are directed toward pursuing, finding, testing, demonstrating, and promoting solutions for the most pervasive and urgent social problems. In other words, foundation philanthropy is in the solutions business and can succeed only if and to the extent it is willing to pursue solutions wherever it finds them, regardless of whether they are in the public, private, or social sector. As a consequence, the assumed exclusive relationship between foundations and nonprofits has become much less so. Foundations are going to support and invest with a much wider range of partners than in the past."
I had written about the term in a post on the changing roles of nonprofits. That post generated lots of discussion - mostly about the term "sector agnostic" and its relevance (or lack thereof) to the work being done by readers and followers.

I've done a lot of writing about the emergence of new corporate forms for the production of social good and about impact investing. I've thought quite a bit about the "changing ecosystem of change" - new enterprises, new types of funders, new relationships. My latest book, Philanthropy and Social Investing: Blueprint 2010, provides an annual industry forecast and describes this landscape in detail. It argues strongly for how much these code-level changes matter to philanthropy.

While these changes have been brewing for many years, the response to the term "sector agnostic" was strong enough, broad enough, and deep enough to convince me that it deserves buzzword status.

I have to say I knew I was on to something about the importance of these "B corporation, L3C, Impact Investing stuff" when a colleague emailed me this link - Rush Limbaugh blasting L3Cs as the "perversion of capitalism." If imitation is the greatest form of flattery, then getting "Rush ranted" must be the clearest sign that something has gone mainstream.

In a changing landscape, whither the 501c3?

I'm concerned about nonprofits. Are they aware of the threats they face?

Are they prepared to demonstrate their value in the face of changes in corporate and tax law, and, as importantly, changes in the cultural zeitgeist about social capital markets and social enterprise?

For almost a century, 501c3 nonprofits have held a privileged place in our communities and in our tax code. They are provided tax exempt status, and supporters can deduct their contributions to these organizations from their income taxes. In so doing, the US tax code privileges these organizations - from major hospitals and universities to small neighborhood groups - as providers of social goods and contributors to civil society.

Those privileges are being challenged from numerous directions. Let me list just a few:

  • New corporate forms that recognize social businesses (these are modifications to the corporate codes at state levels - L3Cs, B Corporations, proposed H corporation);
  • Tax credits for social businesses;
  • Foundations' increasing interest in "sector agnostic" approaches to solving social problems;
  • Regulatory concern about good governance, payout rates, and endowment growth over charitable purpose;
  • Social investment exchanges that are expanding the revenue and capital streams to financial/social hybrids (not necessarily to nonprofits);
  • Growth of models for social goods/civil society that emphasize operating foundations or social enterprises more than a nonprofit framework (everywhere but USA).
Each of the innovations above has advantages and disadvantages and none may be explicitly targeted at putting nonprofits out of business. Most of the hybrid forms are promoted as expansions of the social sector. The fervent interest in social investment exchanges and mission related investing or impact investing are also seen as new revenue sources to good. Note, however, that these are effectively ways of expanding the pools of social good providers and social good financing, effectively increasing the pool around nonprofits, not working to strengthen, support or expand financing to them.

What we are experiencing is a confluence of forces, each of which may have merit independently, but which collectively challenge our current framework (policies, mental models. and financing systems) for where civil society and social goods come from.

Who provides them, who finances them, and how are they distributed?

Michael Edwards' new book, Small Change, which challenges the currently en vogue market model, comes closest to raising these questions. And conferences on regulation, discussions of technological innovations, and celebrations of innovations and changing ecosystems contribute to the broad awareness of options.

But who is working on these big questions in pragmatic ways? Who is looking at what nonprofits do best, what social enterprises and social businesses contribute, and what roles government can and must play? Who is looking out for the whole? Or even looking at the intersections, not all of which are complementary or positive, of these many pieces?

Currently, most of the innovation in the sector is around the edges of our existing corporate and tax frameworks - we are developing "workarounds" to the 501c3 or commercial corporate model to encourage social entrepreneurs and new investors or donors.

The preponderance of these workarounds should have been our first clue - it is time to reconsider the entirety of the systems and policies for the production, financing and distribution of social goods and civil society in the Twenty First century.



The Changing Ecosystem of Change

I'm pleased to draw your attention to a newly published paper we've written with the support of The John D. and Catherine T. MacArthur Foundation. "The Changing Ecosystem of Change" looks at the many new enterprise forms, from social businesses to nonprofits, that are now actively producing and distributing social goods. The paper also looks at the opportunities and challenges these new enterprise forms raise for funders, and that funders raise for these enterprises.

Thursday, February 4 in the SF Bay Area is a big day for discussing these issues. Criterion Ventures, with backing from the David and Lucile Packard Foundation is holding one of its series of "Structure Labs" - working sessions for entrepreneurs to consider the many different enterprise forms and align form with mission.

B Corps, H Corps, L3Cs

Also on Thursday, my Blueprint colleagues and I are hosting a similar, shorter discussion over at the HUB Bay Area. We're thrilled to be introducing a discussion with Beth Richardson of B Lab (home of the B Corporation); Sheila Warren, a nonprofit attorney who serves on the L3C California Task Force, and Robert Wexler, a partner at Adler and Colvin and member of the Legal Working Group on New Corporate Forms, which is working on the H Corp form.

These new forms raise significant opportunities and policy challenges. They certainly matter to anyone in a start-up as the range of hybrid options designed to mix mission with business continues to expand. They also matter to funders and nonprofits, as these forms are direct outgrowths of changes in either corporate or tax law (or both) Where once the 501c3 nonprofit stood alone, these enterprises are seeking recognition for their social purposes - a set of considerations that fundamentally challenges the tax privileged status of nonprofits.

These real developments in the law are why discussions about civil society, its forms and its purposes are so important. They are why we need to consider the full range of policies that shape the social sector - from tax law to intellectual property to securities reporting. I encourage you to read the paper and join in these conversations - we're also blogging about the related topic "What Capital When?" over here.