To read the full blog, click Philanthropy 2225
This is the 6th and last (for awhile) in my list of ideas for generating new philanthropic resources. I originally posited the problem as a response to the estimated $25 billion in giving that will be lost if the US Estate Tax repeal is made permanent. Hence the name. The first 5 ideas can be found in the December Archives of this blog.
What we need is a hybrid R & D venture/enterprise/alliance that brings together the power, longevity, and social commitment of the social sector with the best talents and capacities of commercial financial firms. Imagine being able to do product R & D with creative input from university endowments, foundations, individual donors, banking experts, financial investment whiz kids, and product marketing experts. Imagine having the resources of the full nonprofit sector available to inform the way new products can serve diverse populations, maximize community returns, and be used for social good and marrying that to the deep intelligence about tax code changes and market fluctuations that commercial firms use in creating new products. Imagine being able to develop rapid prototypes and quickly test them in all sectors. Or being able to create new products that would rely on revenue streams other than asset management fees, thus opening the doors to all kinds of new partnerships. Perhaps new products that are jointly developed and underwritten by licensing fees, so they quickly become available to donors and communities regardless of who the lead vendors are.
Why would the competing sectors (and competitors within sectors) do this? Because such efforts might actually be able to grow the resource pool for giving rather than just reallocate it. Products that serve the culturally-specific giving ethos of the nation's fastest growing ethnic, racial and religious groups, for example. Or products that provide social returns through commercial investments. Or commercial returns through mission-related investments. Or that pool small funds into securitized big funds.
What if the kind of thinking that went into creating Global GreenGrants, Grameen Bank, PayPal, NewTithing, SourceForge.net, GoogleGrants, Slashdot, Creative Commons, eBay, Social Venture Partners, community reinvestment tax credits, OneWorldHealth, and the folks who turned Citibank into the largest processor of immigrant remittances was harnessed to create new philanthropic products?
Imagine if the nation's fastest growing ethnic, racial and religious communities could work with financial firms to develop products that fit their giving traditions? Similarly, imagine what the portfolio of philanthropic options would look like in 10 years if the innovators, dreamers and competitors that thrive in technology and financial industries were enticed into philanthropy as part of their work, not part of their retirement?
A pipe dream? Perhaps. But we've got nothing to lose by thinking this through, and we know that the current set up of proprietary R & D will 1) be slower, 2) benefit only a small slice of the industry first, and 3) grow market share for the winners without growing the actual market.