Monday, April 09, 2007

A prediction worth considering

This came in as a comment on a March post, and you can read the whole discussion here. I was intrigued enough by these thoughts that I'm posting them here for all to see:

"Not to prognosticate that y’all are wrong but a counter thought is the number of operating foundations will decrease, as they are rendered obsolete through the creation of more web 2.0, kiva, robin hood fund style marketplaces for direct donor/social enterprise relationships. Foundation research middle men will be cut out, and funding will become much more line item (eg give me 5 grand for a truck), increasing transparency for NFPs. Capital will flow from static large gifts to established organizations to many smaller gifts to groups on the ground with limited capital access or resources for major grant writing but with great stories. Instead of corporate giving decided by a small set of individuals it will be decided by employees with voting accounts, the vast increase in numbers of organizations funded will see a blossoming of NFPs, especially in developing countries, and a feeding frenzy by corporate marketing types of feel good stories about the great work they are doing. Overall organizational accountability will be shown in organizational profiles, and those with the best results and marketing will win. Hyper web savy execs will relax by giving NFPs money and watching the real life results the same way they relax in second life today. It will be a brave new world for all but a few foundation folks! Man, if AIDG ever lets me sleep again maybe I should code all that, unless Kiva does it for me first, you on that Matt? No offense to foundations, feel free to keep supporting us. I just thought somebody should throw out the counter view."

Thanks, phaas


Gayle said...

Phaas left the exact same comment on my blog. If you are at all curious to read my response, you can read it

xb blog said...

I'm not cynical, but the existing philanthropic capital market has no incentives for existing foundations to change their ways, other than increasing pressure to put their corpus to work for their causes, in some small way through PRI's. Jed Emmerson's wrong end of the horse essay of half a dozen years ago is still right on the mark. Foundations are amazing capital retention and growth mechanisms captive to traditional market thinking with a small charitable donation arm out the back end. Newman's Own is more innovative, for pete's sakes.