Wednesday, December 30, 2009

Final Buzzword List - 2009.8, 9, and 10

With less than 48 hours left in 2009 it is time to post up the final three buzzwords of the year. Here they are, in reverse order, as well as numbers 1 -7.

Numbers 8, 9, and 10 were officially announced on Marketplace:

Buzzword 2009.10 Impact Investing
Partly a term of art, partly a new form of putting money to work for social good, and all in all the most well-orchestrated, capitalize-on-a-moment and drive it ahead movement in philanthropy/social investing. Pay attention- Impact Investing is here to stay.

Buzzword 2009.9 B Corporations
I've written plenty about B Corporations in the past. The numbers are still relatively small - several hundred with a combined market cap of $1 billion - but the trend really matters. New corporate forms for accomplishing social good will be a big force in the years to come. B Corporations are also the only buzzword to be nominated twice - also showing up as number 9 in 2007.

Buzzword 2009.8 Mergers
We haven't seen these yet in the numbers that were predicted at the end of 2008. But the sector talked about about them, considered them, funded them, and started to make them happen in 2009. The low numbers may be more an artifact of the reporting cycle than the activity. And we'll see plenty in 2010.

Buzzword 2009.7 Taxonomy
This might have been my personal favorite buzzword of the year - as it was definitely the wonkiest. For those of you who don't traffic in test-prep vocabulary, a taxonomy is "the practice and science of classification," or, as I like to think of it, a taxonomy is a way of organizing stuff. Some taxonomies we use all the time and don't think about them. Without taxonomies, none of the other big ideas - measuring, aggregating, timing, ranking, diversifying, collaborating - that might improve social action and philanthropy are possible.

Buzzword 2009.6 Maps
This year saw maps everywhere - Philanthropy Insight, Kiva, Changemakers - you name it, if there were data involved there were maps involved.

Buzzword 2009.5 Charity Challenge

This year the buzz is all about charity challenges. Think Chase Community Giving, America's Giving Challenge, and the upcoming Pepsi events. These challenges tend to be some form of matching grant - based fundraising opportunity that uses blogs, twitter, widgets, online video and every other possible web-based communications tool.

Buzzword 2009.4 Leverage
In philanthropy the idea of leverage is about using dollars from Pot A to access dollars from Pot B. If a donor puts in $1 and, in so doing, attracts another $1 to the issue or organization, that is a good thing. Leverage is at the root of matching grants, NPR pledge drives, giving circles, pooled grant making funds, social venture philanthropy, affinity groups, and lots of other things that are now common concepts for both donors and foundations.

Buzzword 2009.3 Pipeline
There are two pipelines drawing buzz these days - one is seemingly void of people and the other is seemingly void of funding. The pipeline for new leaders and the pipeline of new funding opportunities are both the topic of great discussion.

Buzzword 2009.2 Sidecar Fund
2009 was the year private foundations officially went into the business of managing "sidecar funds." In the angel investing or venture capital worlds sidecar funds are those that "ride along side" major investments. The idea is to leverage (another buzzword) the due diligence, investment and monitoring that has gone into a primary investment.

For donors these options might be very enticing - high quality expertise on both the investment and grantmaking side at lower cost than other vendors in the market. For the foundations, this offers one way to "leverage other people's money" directly - manage it and give it away.

Buzzword 2009.1 - "move the needle"
The first buzzword of 2009 came in via twitter, from the #cof09 conference. To quote @QuixoteTilts: "Move the needle," official cliché of #cof09. Replaces "sea change" after a record-breaking run." Need I say anything more? Except to note that a shift from sea change to needle moving might be read as the downsizing of expectations....or at least hyperbole.

My next post will be a review of my 2009 predictions. And since the "in" thing to do this new year is not just ring out 2009 but ring out the whole decade of the 00s, I'll also look back at some trends I discussed in 1999. I had the great privilege of writing a paper in 1999 called Foundations for the Future that was published by USC. I also got a chance in 2006 to look back at the paper several years on. I was invited to do so again in January 2010 at a USC event but I can't make it because of calendar commitments. So I'll offer up my thoughts here on the blog and pass them on to the USC folks that way. Stay tuned and have a happy and healthy 2010!

Monday, December 14, 2009

New Research on Online Giving Marketplaces

I am delighted to share some new research - including a spreadsheet of data and an analytic memo - on online giving markets. The research was done by David Koken, a Coro fellow, while he was working at The William and Flora Hewlett Foundation. Let's get the caveats out of the way right up front, as the report and database state:
“This report was researched and written by David Koken, a Coro Fellow in Public Affairs, as a project for the Hewlett Foundation’s Philanthropy department. This work was discussed and overseen by the Hewlett Foundation; however, the final product does not necessarily reflect the opinions of the Foundation or its staff.”
The research looks at 55 websites that provide users with information and/or transactional capacity (gift making) for charitable activity. All of the information in the report was gleaned from public pages on the sites and an email survey (14 of 50 respondents).

Here is the Report on Scribd:

Nonprofit Marketplace Report (D Koken)

Here is the report on Google Docs:

The 55 sites are divided into three categories: information, investments, and donations.

The first type (10 sites) provides information only - transactions are not facilitated through the site. The second type (7 sites) allows for investments seeking both financial and social/environmental returns and the third type (50 sites) facilitate charitable donations only. The sites were categorized by primary and secondary functions (explaining the double categorization) since most of the investment and donation sites also provide information.

This categorization alone is useful and confirms our claim in the Disrupting Philanthropy paper that these markets are - individually and in the aggregate - important new information features in the giving ecosystem. SocialActions knows this best - working collaboratively to pull data from some of these sites (and others) to create a cloud of mixable actions.

While 55 sites were studied, 10 of the sites accounted for 80% of the traffic. These ten are compared according to several characteristics, ranging from the type of data they provide, to site functionality (user comments, social networking) to geographic/issue specificity.

The database is also available. Here you can find out more about each of the platforms, including the type of listings they offer (project, cause, organization), the geographic focus, and what types of data are provided for each listing. I'm including two links to the database because the spreadsheet formatting got a little funky.

Here is the database on Scribd:

The Online Giving Platform Database (D Koken)

Here is the database on Google Docs.

So have a look at the database and the report. You may find something in the data that is more interesting than any of the tidbits I pulled out - if so, please let me know. (Comment below or twitter @p2173 or to The Hewlett Foundation @Hewlett_Found). If you tweet me I may repost your tweet as a comment. You may disagree with some of the findings, or wish that they'd collected different information, or have other input on the database - please let us know.

What do you think about the proliferation of these sites? I wish the database included year of founding so we could look for rates of formation (and, eventually, rates of closure). What other data about the identified sites are missing? Do you agree with the "comprehensive" quotient that aggregates the features counted? Is there a better way to think about rating these sites? Given the number of sites, how does a user know which one to use?

Do you think 55 sites is too few or too many? Are there important sites that were overlooked? (I know there are sites missing from the database because if you sit still for 10 minutes new sites pop up and it took me 10 minutes to write this post). Will this research encourage new site developers to do something else, do something different, do something better? How many of the 55 sites can sustain themselves?

Do geographies or issues benefit from having their own sites or are general sites appropriate? What is key to distinguishing these sites from each other? Does the fragmentation that 55 sites represents speak to possibilities for cross-platform data analysis as we predict in Disrupting Philanthropy?

At another level, what do you think of a foundation sharing its raw data collection in this way? What are some uses for the data and report? Will existing sites use it? Those who are thinking of creating new sites? Innovators looking for the next opportunity on the information landscape? Other funders? What other examples are you aware of where foundations have commissioned something like this and then put it out into public domain for general use? What about doing it through a 3rd party (me, in this case)?

Here's my read on all of the above: this experience - being asked by Hewlett to share the data, reading the research and reflecting on it, and thinking about the role of this blog in the philanthropy information ecosystem.

1) Hats off to Hewlett for sharing this information - doing so fits with their well-publicized talk about improving philanthropy; their increasing openness on their own web site, sharing logic models, grant applications and the like; and their recognition that the data they collect for their own purposes may well be useful to others (After all, knowledge is a philanthropic resource too).

2) The data we collect reflect the questions we were asking. So you may well have other questions about the market of online giving marketplaces that these data don't answer. But now you have a starting place from which to move ahead. For all of those folks who've approached me over the last several months and years with their idea for the "next great" online marketplace for donors, I really hope you will use these data as baseline market research.

3) This may prompt other data sharing. There is other research on these markets - some of which is public, some of which has not been shared.

4) What does sharing this info through philanthropy2173 mean? I was honored to be offered the chance and saw it as fitting right in with what I use this blog for - sharing information, asking questions, playing with ideas, getting feedback, and making sense of (or at least tracking) data points, patterns, and trends. But what do you think it means, if anything?

Sunday, December 13, 2009

Innovations in Embedded Giving...and an Idea about Ideas

Once upon a time I thought my writing about #embeddedgiving would come to an end. Ah, youth. So long as its proponents keep on pushing it, I guess I'll keep being asked about it.

The most recent inquiries, however, have actually led to some really interesting conversations. For example, this post on "unbundling embedded giving" was prompted by two efforts to disconnect shopping from charitable contributions. To literally promote the latter at the expense of the former. A story also ran on Sunday in The New York Times on the WhatIDidNotBuy site. In response to the NYT story, I received the following email (I don't know the sender):

"Ms. Bernholz,
I read your name in an article on the New York Times web site which discussed the site: This article plus another article about gift cards and the millions of unspent dollars left in partially used cards gave me the idea that charities ought to be able to tap that source of money. If gift cards came with an option to allow the holders to send the left-overs to a charity, I think lots of people would take that option rather than give the money back to the retailer.

According to Ron Lieber's article in the NYT, nearly five billion dollars of gift card money will go unspent this year. That money reverts to the retailers. When someone gets a card worth $100 and uses it to purchase an item worth $95 dollars, then the left-over money most likely will languish for a time then eventually revert to the retailer or the issuer of the card. If there were a quick and easy way to donate the left-over money, then card users might do that rather than give it to the store. I know I would gladly do that. I currently have a gift card from The North Face. I used a portion of the value to purchase a jacket. What to do with the remaining amount of money (15 to 20 dollars) is hard to imagine as there is nothing in the North Face store at that price. So I would love to see that money go to a good cause.

I'm sure the retailers and banks would strenuously resist such a change but I'll bet there would be lots of support from other quarters.

Sincerely yours,

Tom Ormond"

This is an interesting idea. Theoretically, the leftover amount on the cards could be tracked and added up - which would possibly address one of my biggest issues with embedded giving - that we don't know how much money goes to charity. As Tom notes, the idea will surely have its detractors. OK - let's here from them - and from those of you who like the idea and can push it a little bit further, refine it, improve it and point out other ways it might work. (Please comment below, tweet about it to @p2173 or email me). Tom's idea reminds me of an effort in the Bay Area, where leftover BART tickets each with a nickel or dime left on them ("Tiny Tickets") can be donated through the East Bay Community Foundation to nonprofits in Alameda and Contra Costa Counties. An example of seeing treasure in trash.

I love that Tom saw an opportunity for innovation by thinking across two domains. I appreciate that he shared the idea with me and then gave me the go-ahead to post the idea here for all of you to consider. I am proud of the fact that several ideas first floated on this blog are now moving ahead: including the Project on Policy in the Social Economy, the Peer-Review for Nonprofits,* and the Impact Investing Index. Each one of those was a half-baked idea that received a certain amount of interest or direct expressions of support or collaboration and are now moving forward in one way or another. Without intending it to do so, this blog has begun to serve like a Kickstarter for philanthropic ideas (without offering any money - smile).

I am even more excited to present Tom's suggestion here, since it wasn't my idea. Wouldn't it be cool if there was a place we could share, vet, improve, and co-develop ideas for improving giving and nonprofits right out in the open? An Innocentive-esque site or wiki or whatever? Sort of like an ongoing Great American Hack-a-Thon for Good. With real innovation brainstorming meetings happening every now and then. Now that would be "working wikily." So there you have it - another idea to consider. Or make happen....

*Listen in on San Francisco public radio KALW 91.7 at 7 pm Monday Dec 14 or streaming at CityVisions Radio for a discussion with Stacy Palmer of The Chronicle of Philanthropy, Rob Reich of Stanford (Author of "Anything Goes: Approval of Nonprofit Status by the IRS") and me, talking about the number of nonprofits, the peer-review proposal, and other issues in philanthropy.

Friday, December 11, 2009

Unbundling embedded giving

(Photo by z287marc, Flickr, Creative Commons)

Just today I learned of the newest riff on embedded giving - call it "unbundled." Here are the two examples, brought to my attention by two different reporters.

BRAC USA introduces What I Did Not Buy which allows you to enter in the price of some thing you might have bought (shoes, music, clothing, a sports car) and find out what the same amount of money, donated to BRAC, would pay for. It's clever, though the little text boxes next to the heartwarming pictures of "what it would buy" are very web1.0 for such a 2010 concept site.

The second example comes from AmeriCares and is - playfully - called Send Your Mother In Law To Darfur. Same basic concept as What I Did Not Buy, with a snarkier name but more boring website. It is one big web form.

What I like about these sites is their clarity of purpose*: they are very clearly fundraising sites for the two organizations, BRAC USA and AmeriCares. The shopping references are schtick - they are not trying to hide anything, fool anyone, or slip a gift into a pair of socks or add it onto your bar bill. Its a donation, clear and simple. And worth it.

On Twitter earlier today I referred to this evolution in Hollywood-ese, as follows:
Love Child of "Buy Less Crap" + "Redefine Christmas" = What I Did Not Buy"
For those who haven't been drowning in this discussion for as long as I have, Buy Less Crap was an Anti-RED campaign website from a year or so back, pointing out to folks that buying is not the same as giving. Redefine Christmas was an ad campaign funded by a foundation in Connecticut that encouraged people to focus on the non-materialistic elements of the season. It is now a website collaboration between JustGive and Changing the Present where you can ask for a charitable gift instead of a necktie or ugly sweater.

These new sites play on our market-driven cultural assumptions that link shopping to giving and then ask you to "unbundle" them. They are in some ways an antidote to embedded giving. In their explicit reminders of the "one pocket" from which most of us do our shopping/giving/saving/investing they also provide a retail view of the same concepts driving Impact Investing and the social capital markets - the message is this, "I've got one small pile of cash, I want to use to further my values, I can do that in how I shop, what I give, and how I invest."

*I was about to call this clarity of purpose "honesty" when I realize they are playing similar games with the "donor illusion" concept that Kiva, Heifer International, etc are dealing with. They don't claim your $50 will go to a particular kid or cow, however, they make it very clear they are dealing in dollar amount equivalents. At least it is clear to me, but then I also knew how Kiva worked....

Related note - please read the discussion (and follow up and comments) on @Bill_easterly's blog about the RED Campaign. FINALLY, some research and real discussion of the complicated relationships between concepts such as sustainable social enterprises, transparency, and accountability.

Thursday, December 10, 2009

Facebook launches Foundation. Or not.

On the same day that it unleashed new default privacy settings on its hundreds of millions of users I learned that Facebook has also launched a foundation to address online privacy issues. Ironically (or not) the foundation results from a lawsuit against the company about...wait for it...privacy issues.

Ethan Zuckerman's blog points out several additional layers of irony about the situation. These include the decreased level of privacy the company seems to be offering in its new suggested privacy settings. Also in the irony column - you have to opt out of the class in the class action lawsuit (which was about opting out versus opting in).

I'll stick to philanthropy ironies - this one pointed out by a digital media lawyer (David D. Johnson who blogs at Digital Media Lawyer Blog:
"Rather, this sum is to be used to help "Facebook . . . form and establish" a non-profit "Privacy Foundation", to fund projects that promote the cause of online privacy, safety and security. While the foundation is to be a separate entity, Facebook gets to nominate one and gets equal say on the nomination of the second of the three members on the foundation board of directors....
What a deal! Facebook is already required by law to promote the online privacy, safety and security of its users' information.
So Facebook effectively gets most of its money back to fund projects that it is already has an obligation to perform. [emphasis added]"
Another irony - while the lawsuit was settled in September 2009 I can't find any sign on the Internet that the foundation yet exists. Lots of legal blogs explain what the Foundation is court-ordered to do, but I don't find data trails that it has been established yet. So Internet time may apply to product launches, but doesn't seem to apply to creating Internet-fueled, legally mandated foundations. (If I'm wrong about this, the foundation does exist, and I just failed to find it online, please let me know). I won't even get into the irony of setting up a new foundation focused on Internet privacy rather than directing the money to any one or a combination of the existing nonprofits that already do that work. Bah humbug.

This sum to the foundation, by the way, is a little more than $6 million, not the full $9.5 million that was ordered to settle the case. The missing $3.5 million goes to the lawyers, the claim administrators and a small sum (really small, $46,000 divided by 19) goes to the plaintiffs.

Probably because the dollar amount is relatively small, this philanthropic buyout has not stirred as much animosity as some other recent donations. But I wonder if we may be entering a phase of philanthropic backlash.....?

Sunday, December 06, 2009

Disrupting Philanthropy

Finally - the "technology paper" I've been working on all year is ready to go live! (Draft 2.0, that is) Thanks for your patience. Those of you who requested copies should have received them via email over the weekend.

Anyone else who is interested can read the document (and download and print it) here and below. If you tweet about it please use hashtag #DisruptPhil (I forgot to add this at first, oops!)

For those of you just tuning in, the paper is about the following:
  • The point: data are the new platform for change. They will continue to fundamentally alter how philanthropic capital flows.
  • The changes are not about the digital technologies that allow access, or about the data themselves. They are about the expectations and behaviors they unleash.*
  • These changes, coupled with changes in the public and private sectors, are pushing a transition to a "social economy" made up of interdependent public, private and philanthropic capital and creators of social goods.
  • All of these changes are not an end of a story, they are simply the beginning.
  • Philanthropy is an industry of passion and volunteerism in which collusion should be encouraged. It may not change in the same way, at the same speed, or driven by the same forces as the newspaper or music industries or the public sector.
Blog posts about it can be found (in order) here, here and here.

We'll be hosting an invitation-only seminar about the document in February and then revising and publishing a final(ish)* version. We don't have the budget to invite you all to the meeting, so my colleagues from Duke and I hope you will download, read, share, and comment on the paper.

Please do so in the comments below, via email to lucy [at] blueprintrd [dot] com, or on twitter at @p2173. All of the input is valued - those of you who read early, early drafts will notice (I hope) the depth and impact of your insights in this new version.

If you tweet about it please use hashtag #DisruptPhil (I forgot to add this at first, oops!)

*Does anything get finished anymore? In this age of crowdsourced rapid prototyping of ideas, it feels like writing has become a series of conversations - draft - conversation - draft. But we'll call the post - February version final. Ideas and improvements and iterations after that will have to take on a new name.

Saturday, December 05, 2009

Philanthropy with an attitude

Spotted the sweatshirt below on Dan at the Stanford Coffee House. Apparently this event, Charity Fashion Show, (VIDEO - turn down the volume or turn the monitor away before clicking if you are in an uptight office or a place with children) was started by an undergrad at Stanford last year and has proven rather successful. Or at least that is what Dan told me.

It is attention grabbing.

I've got nothing more to say about it other than Thanks, Dan, for letting me interrupt your lunch and grab the photo.

Thursday, December 03, 2009

A little bit on a lot of things

I've been at the FasterCures PartneringForCures* meeting since Tuesday (with a side trip to DC) and even with free inflight wifi I can't keep up. So this blog post is going to romp across several things that have crossed my mind in the last few days.

First - FasterCures' PartneringForCures conference - this is a first ever meeting of all of the financial players that influence medical disease research - individual donors, foundations, nonprofits, several government agencies from a few countries, universities, researchers, biotech, pharmaceutical companies. It was a matchmaking-fest, an idea-mosh pit and the biggest complaint I heard was "not enough time." What I think is important about these organizations is that no one fits in one box - the foundation may well be seeking to invest funds from its endowment in the biotech company, the company may be looking for academic researchers with the next big idea, and the individuals are being pitched by everyone - foundations, nonprofits, VC firms, you name it. It's money chasing ideas chasing money chasing results. Chaotic yes, but also full of great information, current events (health care reform anyone? OK how about breaking news on cancer screening recommendations?) and scrappy startups talking to eminence grise docs and researchers.

I've been involved with FasterCures for several years now and have learned an extraordinary amount from the medical disease foundations. The primary sense I pick up whenever I am around these folks is their sense of urgency - their work does focus on life or death issues, even as they engage in funding risky research that could be 20 years from "academic bench to pharmacy shelf." The cross-sector deliberations here, the hallways meetings, the partnering opportunities, the pitch sessions, the mix of capital providers and idea people - this was a conference with an energy rush that wasn't coming from the bottomless coffee pots but from the participants and the panelists. It may be a formula for other sectors to try.

Second - My role at PartneringForCures was to speak on a panel about return on philanthropy. Lucky me, I got to do this the day the the conversation about high hanging metrics finally changed. As GiveWell, Charity Navigator, GuideStar, GreatNonprofits and Philanthropedia urged the public to forego their reliance on the low hanging and "meaningless" overhead cost ratio, Philanthropy Action summed up the opportunity to be smarter about charitable choices.

Meanwhile, my panel of foundation executives, venture capitalists, and donors talked about the current wave in metrics. Has anyone else noticed that we've shifted dramatically from a conversation about "should we measure" to "how to measure" to "which portfolio of metrics matters most in our case?" Whether its Acumen Fund's BACO ratio, the Center for High Impact Philanthropy's Cost per Impact, REDF's SROI, Keystone's Constituency Voice tools, or J-PAL's economic studies or any of the tools and methods now listed in the Foundation Center's TRASI database - the tools are out there. The shift away from overhead cost is made possible because we reached beyond it - to more nuanced metrics - developed by nonprofits and funders - that measure multiple meaningful actions. It may still be a challenge to make them widely known, expand their use, and move toward common frameworks or benchmarks - but it is no longer a case of "should we measure and, if so, how?"

Third - it is not a coincidence that we've moved toward these higher order tools as large data sets have moved online and into public access spaces, as technology and info graphics have made data geeks of us all, and as market-based investing moves ever more dramatically into financing the production and distribution of social goods. My December 1 Marketplace interview highlighted 3 philanthropy buzzwords of 2009 - impact investing, B Corporations, and mergers. All of which reveal the breadth of market thinking in philanthropic circles.

That we've reached this place where we are having fundamentally different conversations about metrics than we were just a few years ago shows how iterative these forces are - technology lets us store and access more data. Market innovation calls for more data. Transparency advocates call for more data. More data lets us ask harder questions of the data and deploy more technological solutions (data visualization anyone?) of the data we have, which in turn begets more calls for more data. Many months ago I was convinced that data are the new platform for change. I'm even more convinced now.

Fourth - thanks to everyone who has commented on the crowdsourcing idea I offered up for gathering community input into the nonprofit approval process. The comments are well worth the read, and the conversation was continued on at least one other blog, The Artful Manager. What I love about the discussion is the real feedback - some argue with the idea, some have extended it much further than I had originally, and others offered up existing analogs from the Phillippines and Belgium. I'm still most interested in thinking about if, and how, crowdsourcing expertise about community needs could be used at the front end of the nonprofit approval process. Could panels of human service providers from the west coast provide comment on a "needs statement" amendment to the 501c3 application from a proposed new organization on the east coast? Could local donors, foundations, community foundations, and government funders share their databases of local organizations with nonprofit-to-be startups in some useful way? Could community needs "reviews" be one factor among several that would be considered necessary for proposing a new organization, extending the IRS's reach to include community voice and support somehow? I've learned lots from all the commenters and twitterers - thanks for jumping in!

Finally, the above "idea" - or at least the problem and its possible solutions - is one of many things I plan to be thinking through at length in both of my new very exciting gigs. I'll be working at Stanford University as a Visiting Scholar at the Center on Philanthropy and Civil Society, hoping to make the idea for a global policy network into reality. I'm also working on a new book (one of two) as part of my fellowship with the New America Foundation.

The book feeds the policy project in terms of illuminating some of the complexity of how this now happens and the policy project will feed the book. My continued work at Blueprint and your feedback on ideas on this blog feed all of it. With New America and Stanford we will plan several events/salons/discussions/mashups of these ideas as they progress - so please send me ideas, forums where it might help to include this work, or resources that might be useful to this kind of thinking. I'll make sure to announce the public discussions on the blog so you can join us if you are in the area (Bay Area or DC, most likely) and interested.

*I serve on the organizational review board for FasterCures Philanthropy Advisory Service.