Thursday, March 27, 2008

The Future of Foundations

The Open Social Foundation is a new :

"non-profit entity jointly proposed by Yahoo!, MySpace, and Google. The goal of the OpenSocial Foundation is to ensure the sustainable and open development of the OpenSocial initiative and related intellectual property."

You can read the proposal for the foundation here and read liveblogging coverage of the announcement here.

The Open Social Foundation joins the Mozilla Foundation, a nonprofit which makes and protects and markets the Firefox Browser, among other open source software tools (Thunderbird, SeaMonkey, Camino, etc). The Foundation runs a commercial company which some estimate to be worth $1.5 billion+. When will it take the company public? According to and others - never. According to analyst Henry Blodget, this year or next. If you'd like to get in on the prediction market around this issue you can do so here.

Another example is the Wikimedia Foundation, which runs Wikipedia, one of the ten most visited websites in the world, day after day, month after month. The Foundation is an organization that has been in the news a great deal, with questions being raised about its close links to venture capitalists, its need to develop a sustainable business model, and the practices of its founder. Since Wikipedia lives because of the active involvement of its millions of contributing writers (anyone can participate) it faces a level of community accountability and connection that other nonprofits can only dream of.

So what for philanthropy?
  1. Intellectual property is the key asset of these organizations. This embodies the trend I've been writing about since 2000 - knowledge is the base of the new philanthropy and will be at the core of emerging philanthropic capital markets - how they work, how they set value, how people use them, etc.
  2. Each of these organizations is a blend of tech money and products, commercial interests, and nonprofit structures. They embody the hybrid structural organizations and priorities that we will see become ever more common. And which I've been writing about for years.
WikiMedia Foundation. Mozilla Foundation. Open Social Foundation. Chances are you won't run into their CEOs at a grantmakers conference - even though they are the future of foundations.

Tuesday, March 25, 2008

Questions, not answers, on open source philanthropy

I wrote a book chapter about open source philanthropy. It is in The World We Want, edited by Peter Karoff and Jane Maddox and includes an interview with me called, "Open Sesame: Networks of Cooperation and Open Source Solutions."

It presented seven building blocks for bringing open source principles to philanthropy. Here they are:

... These seven building blocks of open philanthropy are:
1. Facilitate adaptation, don’t hinder it
2. Design for interoperability, local specificity will follow
3. Build for the poorest
4. Assume upward adaptability
5. Creativity and control will happen locally
6. Diversity is essential
7. Complex problems require hybrid solutions

And more recently I've been thinking about public ideas, crowdsourcing innovation through Kluster or Social Innovation Camp, and now the folks at Social Edge are onto the idea - read this discussion on open source social entrepreneurship.

These concepts raise a lot of questions for philanthropy. Where are the lines between public and private when it comes to ideas for the public good? Can or should someone be able to own a policy innovation? Protect a service delivery process? Are all socially positive ideas public? What are the best ways to encourage creative thinking and bring the ideas to action? Is social entrepreneurship better at this than anything else? Are social entrepreneurs even paying attention to raging Intellectual Property debates - and, if so, how and why? What should they be asking? What should philanthropy be asking?

Thursday, March 20, 2008

Public ideas

A recent opinion column in The Chronicle of Philanthropy called for better protection for public policy ideas. Huh? This was a mind-bending piece for me, one which I finally realized struck me as the "solution" being - at best, a misapplication of resources - and, at worst, a bigger problem than that which it was proposed to solve.

But let me back up.
In a commentary on March 20, J.H. Snider wrote the piece, "The Quest to Protect Creative Policy Ideas." Here's where it starts:

"No one has figured out a way to legally protect public-policy innovation without doing more harm than good. The whole point of a public-policy idea is that it can be copied and used by anybody, not just those who can afford to pay for it."
I would have thought that the "whole point of a public policy idea" is to influence public policy.

The piece goes on to insist there is still a need to encourage original thinking instead of plagiarism of ideas. Here the argument relies on a market economy orthodoxy justification for patents and trademarks, that without them their is no incentive for the work. As the commentary notes:

"That people need incentives to engage in intellectual work is a bedrock assumption of modern economic thinking and was the reason America's founders included patent and copyright provisions in the Constitution. It is also why all major universities have strict prohibitions against plagiarism."

Now, I would have assumed that universities have rules against plagiarism because it is theft, not to offer incentives to originality. And the economic validity of and orthodox thinking about the relationship between patents/copyright to innovation and economic vitality are both being seriously reconsidered in an age of digital creativity and distribution. Which may not be why the writers of the Constitution put time limits on copyrights and trademarks, but it is certainly why some sectors of our economy are working hard to extend those time limits and others are fighting back to reduce them.

As I read this piece I kept wondering if there wasn't a basic mismatch of problem and solution. That said, I have no sense if plagiarism is a real problem in think tanks. I do think that the ease with which ideas are built on, shared, and spread (that is not to say, stolen) is actually a sign of the value of those ideas, not de facto signs of a faulty system. So when the following solution is proposed, I found myself scratching my head. Here's the solution:

The Internet now offers the promise of radically changing the incentives for plagiarism so that the social sanctions against plagiarism that work in the academic world can be transferred to the think-tank world.

The task now is to use similar methods to create a community of experts with the incentive to reward genuine public-policy innovation.

The specific method I propose is for foundations to finance an authoritative online clearinghouse of think-tank research with new tools to facilitate peer review....

The closest precedent for this proposal may be the a pilot project developed by the U.S. Patent and Trademark Office with the help of New York Law School's Community Patent Review project.

So on one hand, I think "an authoritative clearinghouse" of public policy ideas is ideologically impossible (and undesirable). Maybe multiple clearinghouses? But wait a minute, isn't that what think tanks are?

So, for the sake of the argument lets assume that "think tanks" and politicians are stealing academic's ideas. Is plagiarism of public policy thinking a problem? I don't know, and hence the author may be on to something - maybe the original thinkers in academe are being "ripped off" by the more public, application-ready systems and purposes of think tanks. If we agree that it is a problem, it seems there should be citation analysis, professional ethics, and easy digital recourse for an idea's originator (is there such a thing?) to come forth and claim rightful originating ownership.

But here's where it gets tricky. Experiments that bring the energy and reach of communities of interest into play in coordinated ways with decision makers is one of the most exciting possibilities of online networks. So solutions that rely on "communities of experts" may be a good thing. These kinds of networks expand the mental and physical reach of central decision making bodies, they bring diversity of opinion to the table, and they can be inexpensive expansion of dedicated workers - but as research on open source production shows, they are not perfect, they are better at refining ideas or conducting routine tasks than for creating new things, and they have to be managed toward a goal.

For examples of success, look to the way TPM Media relied on readers around the country who first identified a pattern of attorneys general firings, and then returned to those communities to weed through 1000s of pages of Justice Department documents. Or NASA's "clickworkers" project that lets individual astronomy enthusiasts map planetary features. Or how Netflix reaches out to individual innovators to improve their algorithms for recommending movies.

As I read the piece I realized I was now thoroughly confused. I think there is a role for networks and communities of interest. Is this the right solution to the wrong problem? Or the wrong solution?

Which brought me back to my basic understanding about ideas - and the need for us all to think about this, in this age of knowledge economies, intellectual property, and digital media. Ideas only have value if they are used, riffed on, adopted, adapted, expanded, and argued about. Those who think them need those who use them. Some think tanks seem to be very good at sharing ideas with new audiences, in new ways, for new purposes - see the newest issue of DEMOCRACY: A JOURNAL OF IDEAS - as an example. Or the frequent invitations to New America Foundation events. Or the daily (!) newsletters from the Center for American Progress that fill my email inbox.

But are there academics behind these ideas, stuck in junior faculty positions, whose work is not getting recognized in this system? Again, I don't know. But if there is, that seems to me to be a problem for the system of academic rewards communications, peer-journal expectations, and publication-ocracy. The new systems of distribution should work to the advantage of good thinkers and writers, idea generators ought to be invigorated by the speed with which their thinking can "go viral," and the old citation systems ought to work in this digital world.

Ideas matter. Those who think them matter. Those who distribute them and those who use them matter. Bringing new technologies to bear on any parts of this seem to benefit all and shouldn't come at the expense of any piece of it.

Wednesday, March 19, 2008

Social Innovation Camp

A few weeks back I wrote about Kluster and the promise it might hold for rapid prototyping of social ideas. Here's a better example - Social Innovation Camp, London, April 4 - 6, 2008.

For 72 hours techies and social innovators will work on the following six ideas:
- Barcode Wikipedia

A site for storing user-generated information – such as carbon footprint, manufacturing conditions and reviews - against a product, identified by its barcode number.

- Enabled by Design

A resource for anyone looking to make adjustments to their lives, be it as a result of disability, injury or impairment.

- Personal development reports

An online system that supports young people to identify their personal skills and qualities.

- Prison visits

A tool to support the families of prisoners coping with the experience of being apart from a loved one.

- Rate My CV

A site for helping jobseekers using Web 2.0 tools.

- Stuffshare

Freecycle meets Street Car: a stuff club.

The idea of Social Innovation Camp, and the ideas to be worked on at the camp, are all about using networks to create and refine solutions to social challenges.

Tuesday, March 18, 2008

Virtual Seminar: Can online investing end poverty?

This discussion will focus on MicroPlace as a breakthrough innovation in microfinance. Sponsored by The New America and Calvert Foundations. Join the webcast on March 19 at 1 pm pacific, 4 pm eastern by logging in here. Those in DC can attend in person at the Ronald Reagan International Trade Center Rotunda, 1300 Pennsyvlania Ave.

Recessions, the wealthy and philanthropy

Given the chaos on Wall Street these past weeks, a report on the declining rate of growth in American millionaires may not come as any surprise. But since philanthropy is ever-occupied with transfers of wealth and such, I thought it appropriate to bring to your attention this report from the Spectrem Group:

"The number of Affluent and Millionaire households has continued to grow for the fifth consecutive year. Growth rates have, however, slowed considerably."

For the record, Spectrem's definition of Affluent and Millionaires is those worth $1m or more, not including value of their primary residence. Given housing prices, the value of their homes may not be helping things anyway.

How considerably? Well, millionaires increased in number by only 2% in 2007, having grown in number by 8% the year before, 11% in 2005, and 21% in 2004.

The report still found 9.2 million households and Robert Frank, over at WSJ Wealth Report, notes that wealthy households tend to increase in number even during recessions. He points to data from 2002
that show "the number of millionaires... grew by 2% and their wealth grew more than 3%... The next year, growth was even stronger."

So, what might this mean for giving? Well, if history is any guide recessions will still create millionaires and giving will still increase (though slowly). According to Giving USA, from 2001-2002 giving grew by an inflation adjusted rate of 0.6 percent, from 2002-2003 it grew by an inflation adjusted rate of 0.5%.

Monday, March 17, 2008

Now the news is a portal to giving

A new service, good2gether, links news stories on social issues to nonprofits addressing the issue. The service, called Good2gether (G2G), allows readers of a news story to click through directly from the story to donate to an associated nonprofit's website. Launch cities include San Francisco, Boston, Atlanta, Houston, New York and Philadelphia.

How does it work? Nonprofits post profiles (why don't they just pull from Guidestar? - see below on business model), stories run, Good2gether provides media outlets text with associated npo info to run in a sidebar. Reader reads story, gets interested, clicks on npo link in sidebar, reads profile, takes action. Cost to NPO? Time to create and update profile, no cash.

Business model: Nonprofits can sell up to six sponsorships to companies and list those in its profile. Cost of such sponsorship - at least $100. Of that money, 35% goes to G2G, 65% stays with nonprofit. So nonprofits become outsourced salespeople for G2G - sponsorship fee and percentage don't seem linked to click throughs, actions, or anything else - if a npo sells $600 worth of sponsorships and uploads profile to the site, G2G gets $210 off the top, even if links to NPO never run or no-one ever clicks through to npo.

Shout out to Sarah Duxbury and SF Business Times for the story.

My questions:

1) Can nonprofits pay to be linked to "news terms" the way they might pay for search terms?
2) Who vets which npos are listed with which kind of story?
3) Are there other fees or percentages taken when a reader clicks?
4) G2G also works directly with media companies and company sponsors - in essence it is a "cause related marketing" widget intermediary - serving up cause and marketing together.
5) Will G2G make public the dollar value, time value of contributions it facilitates?
6) Who audits these transactions and on behalf of whom? G2G, nonprofits, sponsors?

Good2gether may be taking embedded giving into a whole new realm - it acts as intermediary for all sides of the relationship (sponsor, media co, and nonprofit) and embeds news into nonprofit solicitations and nonprofit solicitations into the news.

All info above is gleaned from good2gether website and the SF Business Times story. It is my interpretation of how this works.

Second Life Foundations Discussion

Foundations in Second Life: Monday, March 17th at 5 pm PDT , in Second Life as part of the Life 2.0 Summit - get there here

And here is an 8 minute tour of virtual worlds that Sharon Burns of the MacArthur Foundation put together. And here is her tour on WhyVille - a virtual world focused on children learning and sharing ideas.

And on Thursday, March 20 the Foundation will give the first International Justice award to Kofi Annan. The event will be accompanied by a Global Kids secondlife International Justice center. All of these events cross worlds - from real life to virtual life, from one virtual world platform to another.

Friday, March 14, 2008

Foundation blogs - again

Peter Osnos writes about media for The Century Foundation. His weekly column, "The Platform" is one of my "must reads."As regular readers of this site know, I think the changes in the media business give us much to think about where philanthropy (and many other industries) are concerned.*

Anyway, beside taking time to appreciate some thinkers out there, the purpose of this post is to bring attention to The Century Foundation's new foundation-wide blog - online at Taking Note.
Here's a sample post, referring to the recent NYT article on philanthropy and school reform.

It joins a small circle, ZeroDivide's blog is another publicly accessible staff-wide blog from a foundation. Do you know of others? Please list them in the comments section so we can point to them as well.

*Here is a long overdue shout-out to Katherine Fulton and Andrew Blau for helping me understand anything that I do understand about media.

Wednesday, March 12, 2008

Trend Analysis for the Social Sector

I've written before about where we stand in developing philanthropic capital markets (I'm sticking with this term, instead of the more en vogue "social capital" markets" because social capital is a term that refers to "connections within and between social networks" - in other words, it is something different from philanthropic revenue for public goods). We continue to see new developments in this area - including the promise of sub-sector private equity-esque reports about areas of public benefit work (an idea I had mentioned in my book), more action on social stock exchanges, including coverage by Muhammad Yunus in his new book, new insurance structures, and real conversations about philanthropic marketplaces - both online and off.

In the spirit of always pushing forward (and on the basis of many, many people telling me my 2004 book was ahead of its time, the world is now catching up, and I need to sprint out ahead again (smile)), I hereby propose a new product or service for these emergent markets - quality trend analysis of major global forces and their implications for giving. This would be a (or several) sources of analysis that look at broad trends and how they influence the whys and ways people are striving, thriving and/or expressing themselves.

This might be something similar to the research my financial adviser provides me each quarter - a broad brush look at how trends in energy and commodity prices are affecting my portfolio holdings. Given that the financial officers and investment advisers at foundations may already be getting this kinds of analysis as it relates to their portfolio holdings, maybe the opportunity exists for that research to be re-analyzed by program area experts. This might be a way for the oft-separated investment and program sides of foundations to work together. Donors, foundations, nonprofits and activists can benefit from careful, timely analysis of how certain trends are affecting the people and causes that they care about. I call these products/services trend analysis for the social sector. My first proposed topic - the global credit crunch/crisis/collapse.

What is the issue, how is it playing out, and what does it/will it mean for philanthropy? Not just for foundation endowment growth, but, more importantly, for education, the arts, human services, public health or the environment? For immigrants and human rights? Funders interested in housing and neighborhood or community development are already looking into strategies to address foreclosures - but what about the rest of the programs out there? If people lose their homes and cities lose their tax base what does it mean for the schools? For the arts? And so on.

Topics I propose for the on-deck circle:
  • Demographics and regional, global mobility issues.
  • Weather-related disasters and insurance/mobility/food security.
  • Economic development projections about job creation and skills pipelines.
  • New organizational forms, legal structures, and global innovation in service delivery and production structures.
All written from in clear and accessible language, from an evidence-base, and with probing questions and possible implications for various areas of philanthropic support.

Let me know if there is something like this out there, in development, or on the horizon. I'll keep working on the next, next thing.

Monday, March 10, 2008

Ruckus Nation Semifinalists announced

Ruckus Nation announced 56 semi-finalists today, heading toward the grand prize announcement on March 17. List of semi-finalists is here. Each of them won $250 and are in the running for bigger prizes, exposure, and possible investment.

Ruckus Nation is an online idea competition sponsored by HopeLab. It is designed to spark innovations (new games, tech-related devices, other) that will get kids moving and thus help fight obesity. Categories include middle school, high school, university and other. I served as a judge in the "other" category a few rounds back.

Friday, March 07, 2008

Self interested foundations

David Leonhardt, "Economic Scene" columnist, looks at this question in this Sunday's "Money" issue of the New York Times Magazine. Online here. As Leonhardt looks at social science research on this question, particularly that done by economists, he asks:
"To put it bluntly, is charitable giving a high-minded form of consumption?"
That is a question for an economist, and Leonhardt sheds a lot of light on it. I'm more interested in the broad findings he cites of researchers who studied the effects of matching gifts, as well as pyschological research, and the economists' persistent search for rational behavior. All of which point to findings that some of what motivates giving is not rational, it is feel good. It is self interest. In the words of the researchers, it is "warm glow."

This is, no doubt, going to strike you as either painfully obvious or ... painfully obvious. Some may be moved by this finding the same way I was when I learned that one national government had invested millions of Euros in sleep research to reveal that the best cure for being tired was to take a nap. So why do I bring it up?

First of all, self interested does not mean self-serving. A donor can be self-interested in public health, even though she has private insurance and a primary care doctor. She may be interested in public education, access to the arts, and religious tolerance - even though she has no children, can't paint, and isn't observant. She can also be interested in public health, public education, the arts and religious tolerance - and a direct user of free clinics, local schools, museums, and active in a congregation. She may make enormous grants to homeless shelters in her community because she cares deeply for the poor or because she doesn't want people on her street or because she doesn't want government paying for services or to stop religious organizations from providing social services or other reasons all together. She may help someone because she was once in their position, doesn't ever want to be in their position, or sees herself indirectly benefiting from their direct benefit. Passions may be shaped by personal experience, or political frameworks, belief systems or the advice of trusted elders - any of these influences or all of them may be at play, and they don't, and shouldn't, be used to make self-interest synonymous with self-serving.

Second, if if those of us in philanthropy know these research findings about motivation to be true, why do we ("we" meaning organized philanthropy, staffed foundations being the most frequent culprit of this) insist in pretending that it isn't? There seems to be some pride in pretending that our organizational program areas and focus are informed only by community needs, scientific assessments, or research and dispassionate analysis?

I see it differently. At some point all foundations are set up to address issues that were of self interest to someone...there may be degrees of this, sure, but I challenge us to find a single foundation - public, independent, corporate - as formal and as rational and as market aware as you like - and not be able to trace the organization's work to someone's "self interest" in two or three (OK, maybe even six) degrees of separation. Someone chose the areas to work in, someone picked the issues, someone defined the programs - some of them (lots of them) do this with a lot of research, community input, and credible analysis. But the initial setting of parameters - geographic, issue-based, religious, demographic - you name it, will reveal the "self interest" of the donors, their lawyers, trustees, children, accountants, professional staff.

Try it. If you find a foundation for which there is no trace of self-interest, let me know. Why? Because I think acknowledging the role of self interest is nothing to be shy about - in fact, it makes sense to me that organizations established to pursue the interests of the donors will be more effective - donors will be more engaged, staff may be hired for their professional knowledge and personal passions, and everyone involved will care about the work. I'd even go so far as to posit that establishing a funding organization to advance the interests of the donors is more likely to lead to the use of research, analysis, and a broad range of expertise than not.

Self interest gets a bad rap in philanthropy even as research shows that it is "ever with us." Let's change the argument from "either self interested or effective" to one that uses that self-interest to motivate smarter giving.

Wednesday, March 05, 2008

Issues that Matter

(Adapted from Plenary Presentation, MicroEdge Users Conference, November 2007.)

This post is about nine issues that matter to you - whether you work in a nonprofit public benefit organization, are a philanthropic funder, or happen to be a commercial technology company that serves those markets. Now, even if I do say so myself, "issues that matter” is a pretty gutsy title. Matter to whom? When? Why?

These trends matter to other people as well, but for other reasons. I’m not here to talk about them. I’m here to talk to you. My goal is to raise up some questions you might not know you’ve been harboring, shift some of the ways you think about issues so that you consider a new side to them, and - most important - point out some patterns between issues and ways that they are dynamically linked that may just explain why you feel like time is too short, information too plentiful, and decisions require too many variables.

Here are the issues that matter:
  • Demographics
  • Groups
  • Ownership
  • Mobility
  • Markets
  • Price
  • Forms
  • Time Frames
  • Alignment
And here is why these things matter:

Demographics Matter
I’m going to start here because people matter. According to the 2000 Census, the US is older, larger, and more diverse than it has been at any other point in time.

How many people reading this are caring for your kids and worrying about, or actually caring for, your parents?

Age matters. An increasing old population affects jobs, taxes, social needs, volunteering rates, and philanthropy

Youth matters. The young population affects jobs, taxes, social needs, volunteering rates, and philanthropy.

These trends shape who works, who votes, who needs what, who pays taxes, who draws benefits, who supports whom. They will have strong affects on the much-tauted Intergenerational Transfer of Wealth – which is actually a three-generation phenomenon not just two.

Think about the demographics where you live and work. What does your community look like now? What will it look like in 20 years? How will you benefit from the changes?

Groups Matter
At first, this seems a derivative of the demographics issue. The first one is about people, the second one is about what people do together.

But Groups Matter is also about how people do things together, and with whom, and when, and why, and for how long.

Think about this – from a technological perspective on groups – lets call it social networking – we’ve gone from an arcane academic term to Friendster to MySpace to Facebook to OpenSocial in about two years. Groups are driving users of technology, driving audiences for innovation, and driving forces in our economy.

And people are members of many groups. For different reasons. At different times. No single nonprofit organization or philanthropic effort is going to meet a person’s lifetime of needs. Go back to the question I asked you in the beginning, about kids and parents. Those of you who answered that question with a nod or a moan are members of different groups that fit your identities as (and I’m drawing some generalizations here, feel free to challenge me later) – individuals, parents, children, professionals, men, women, religious, volunteers, and ethnic and racial. You use different resources for different goals, drop out of groups when they no longer serve your purpose, create new groups for new reasons (I just received an email from a group of neighbors volunteering to clean up the beaches around San Francisco Bay. The group is also raising money to help clean shorebirds). The group didn’t exist one week ago.

We also know that groups are good at decision making (you’ve heard of the wisdom of crowds) and that diverse groups are even better at decision making.

Groups matter. They matter to us as people, they shape the way we work, give and volunteer, and they matter to us as technology innovators, they matter to us as nonprofit managers and philanthropists. Groups matter.

Ownership matters
This seems a little bit further away from people and groups, but its connected, trust me. For example, groups own things – like the sky, the oceans, and the freedom to create. Entire economic revolutions have occurred in my son’s lifetimes by companies that built enormously powerful tools – specifically Google and eBay – and own none of the things those tools are used for.

Ownership matters in our digital age. It is changing in our digital age. New versions of copyright and patent law, new expectations for the value of sharing,

Do you know what these little icons on the bottom are?
Social tags – They let you post and click and tag and save content from one place to another. We may “own” something, but in the digital world, it is very hard to control it.

Most of the discussion about this in today’s press is set up as a battle between record companies and musicians, or television networks and user-generated video or, in the case of writers and distributors, its set up as a strike. For the rest of us, however, I prefer to think of it as a choice – for your foundation, your nonprofit, your technology company. It’s a choice between business models and the choice is this:

“Will you be more successful (you define success) building something that is protected and proprietary and then factoring in the costs of defending it – OR – will you be more successful building something that gains value as it is shared and letting it loose?”

Mobility Matters
Part of the reason ownership matters is because not only can digital content live anywhere, it can go anywhere. Think of where you do your work today – at a desk? With a PC wired into the wall? On a wireless laptop?

How about the millions of people who use only their cell phone to make purchases, find out prices, sell their wares, or notify local emergency officials of danger?

What about the foundation executive who says to his CTO, “I’m not lugging my laptop with me anymore – I want everything fed to my blackberry via a RSS feed.”

Oh, yeah, I almost forgot, its not just data that move so easily. People move. Jobs move. Skill sets move. Groups move. Ownership moves.

Markets Matter
Markets matter to social good in so many ways I could focus this whole post on this issue. I won’t – I’ll just send you to my blog, – where I’ve been writing about this literally since I published a book on it in 2004.

For the sake of this discussion, let me say that “markets matter” is shorthand for the changing ways that social goods are produced, distributed and financed, the changing roles of public agencies, and the blurring of revenue sources for public benefit work.

There are three large ways of thinking about how markets matter:

1. President Clinton reminds us in his foundation work and in his book giving, that the capital markets for social good are “underfunded and under –organized.”
2. Capital for social good is now as likely to come from fees for service, government contracts, private investors, social venture funds, or socially responsible investment funds as it is from philanthropic gifts.
3. We are increasingly surrounded by market approaches to social goods – from private companies that manage public libraries to commercial restaurants that focus on job training to double bottom line investment funds.

Markets matter in general. They really matter when considered in the context of changes in the public sector and the independent sector – one reason markets matter is that they remind us to never try to predict changes in one sector – say commerce – without also considering changes in the public and independent sectors.

Price Matters
There is a book out called “Strategy of Giving.” It has nothing to do with either philanthropic planning or preparing for the holiday gift giving season. It is about the value that is created and attained when products – ideas – designs – music – information are exchanged for free – they are given away.

A decade ago this would have seemed like heresy. A decade or so ago the closest example I could think of was the razor blade business – sell the razor for cheap, make a fortune on the blades. But that’s cheap. Not free.

Then came Google. And FireFox. And MySpace. And Ubuntu. And YouTube. Everything they provide to the user is free.

This takes us back to our point about ownership and markets and that basic business model choice – will what you are doing or selling be more valuable if it is free? Is there a business model that’s about location, ads, or transaction services that you’ve never considered that might be worth a look?

Or are there other assets – information, networks, and human resources come to mind – that you are hording rather than sharing, and in so doing, limiting your effectiveness rather than strengthening it.

By the way, the book “The Strategy of Giving” is available for purchase. The price? Its free. You might also check out Chris Anderson's new article in Wired - it is all about "Free as the new price." Oddly enough, the magazine is not free.

Forms Matter
So we’ve looked at individuals and groups. We’ve considered the meaning of ownership, mobility, markets and price.

What about form? If everything so far is really changing – who we are, how we congregate, what we own, where we use it and how we exchange it with others, its falls to reason that the structures we use to organize ourselves are also changing.

Some of the changes have to do with technological innovation – remote workplaces, telecommuting, pda’s and airplanes that get you across the world in a day. Organizations are more global, flatter, more dispersed, and more creatively chaotic.

Other changes are arriving in the form of regulatory and structural innovation – think of hybrid nonprofits and social enterprises and corporate social responsibility officers. But also be aware of totally new structures – such as Limited profit Liability Companies (or L3C s) and B Corporations – which are public benefit corporations supported by commercial sales.

Keep your eyes out for continuing new forms of social organization – where the movement meets the flash mob for example. Or where giving circles, social networks, and financial innovation around charitable vehicles come into play. Keep your eyes out for new forms of giving, new organizations in philanthropy, and new structures for social good.

Time Frames Matter
Ah. Not a minute too soon. Each of these forces works at different speeds –

Technology changes quickly. Organizations….not so much.

Markets can shift suddenly or steadily survive bump after bump after bump.

Groups can last for 100 years. And then fall apart.

Some of us change jobs and cities frequently, mobility is part of our identity. Others will stay put for as long as possible.

Time frames matter. They are not synchronous across these trends – some move quickly, some are slow. Make sure you know which one you are dealing with, as well as what kinds of forces can accelerate or decelerate the pace you’ve calibrated.

This is not just about work, or giving, or volunteering. This one – time frames – is about everything. Some things you can and should do quickly – assess the role of new competitors, take advantage of a political window, or jump on a opportunity to be with your loved ones.

Other things will need more time and should be given it – strategic mergers, the pursuit of social justice, and the time spent reading with your children.

Make sure your time frame makes sense. That’s what really matters.

Alignment Matters
New forms of action. New prices and markets. New ways of moving and owning and sharing information, innovation, and ideas.

Just make sure there is some alignment across them, OK?

With so many choices in form, groups, markets, platforms and pricing, nonprofits, foundations and technology companies should be constantly adjusting their strategies to make sure their efforts are aligned.

We’re seeing this in the attention to mission related investing as foundations seek alignment across financial assets as well as their intellectual and human resources.

We’re seeing this in the way savvy nonprofits are using their volunteers, social networks, fundraisers, and blogs.

We’re seeing this as individuals try to align their full financial portfolio with their values – that means their philanthropy, their political giving, and their investing.

Without alignment, really, the rest of this will be chaos. Consider your choices. Play to your strengths. But power behind all of the oars in your boat and make sure they are all pulling in the same direction.

Take them all together –
1. demographics,
2. groups,
3. ownership,
4. mobility,
5. markets,
6. price,
7. form,
8. time frames and
9. alignment. (If I were Julie Andrews I’d burst into song right now)

Somewhere in that mix is the cause of and the answer to your big organizational questions, your time and information challenges, and, perhaps, even something for yourself. There you have it. Nine issues that matter, and why.

Tuesday, March 04, 2008

Tech Roundup 2008.1

Here's my first philanthropy-related tech roundup for 2008.

Peer to Peer Disaster Relief - someone needs what you have to give - make it happen on iCARE a project in progress from the engineering school at UC Berkeley.

Crowd-sourced product (or service or action) design. Kluster was recently used to design a social game that builds global cultural awareness.

A new app to organize social action on Facebook. Read about it here.

In what might be seen as a birth-child of Kluster and Ultimatums a recent Stanford class created 50+ Facebook apps in 10 weeks (100 students, 10 million installs, and 1 million daily users). They shared what they learned at the Graphing Social Patterns Conference.

Netsquared MashUp Challenge
Netsquared, a project of CompuMentor and TechSoup, is entering Year Three and has openings for a Google Hackathon (March 7, Mountain View, CA) and Mashup Challenge (Applications due March 14)

Goodwill Industries uses the web to sell its wares, train its employees, and help them build community - here's a video of Goodwill's CIO discussing the applications.

Tags: ,

DISCLOSURE: I was on the Board of CompuMentor until December 2007 and am a NetSquared Advocate.

Sunday, March 02, 2008

Extinction Timeline

Extinction usually makes me think of odd looking fish, once pristine forests now used for crops, and Joni Mitchell's Big Yellow Taxi (video). It usually evokes images of natural things that mankind has wiped out.

Ross Dawson has an extinction timeline of things man has wiped out or will soon wipe out. The difference is that his timeline consists of things man first created, and is about to wipe out - such as libraries, newspapers, petrol-fueled vehicles, blogging, and coins. You can download the timeline here.

This kind of timeline is an interesting device for donors and foundations - extinction is one thing if your funding is intended to prevent it (wildlife, flora, seeds, etc.) but what if you are planning for it? Or at least factoring in the likelihood of massive institutional shifts (including extinction) into your strategy development?

How does it change your thinking about funding something if you first consider whether or not the institution will last? How would education funders change their work if they seriously considered whether or not schools will continue in the digital age? What about health funders if wellness care replaced urgent care? Or art funding in an age of transient performance pieces that are designed to happen once and be gone, never to be preserved in a museum or by dance notation?

What does transience mean for philanthropy? What about planned obsolescence? Or extinction? Or simply the idea that institutions have lifespans and so they will end...?