Thursday, December 30, 2010

How things have changed

A friend of mine with a 10 year old asked me how she could spend time with him making their charitable donations this year. She and her son are generous people and are actively involved in local community and political issues. The dollar amount of their giving is significant to them and puts them squarely in the heart of American generosity - they are absolutely typical of the long tail of American givers who collectively donate $225 billion +/- each year.

She had a working list of about two dozen organizations covering a range of issues, mostly environmental and wildlife preservation. She had heard of a site where she could check their overhead ratios (Charity Navigator). But she wasn't convinced that overhead was the most important factor in choosing a nonprofit organization and she thought that her son wouldn't care. Most of the organizations she had on her list had the same number of stars so this wasn't going to filter anything out for her.

I told her about GiveWell, the BBB, Philanthropedia and GreatNonprofits but warned her that these sites don't cover the full breadth of issues and may not have information on the organizations she was considering.

Remember - she wasn't looking for new organizations she was trying to compare organizations against each other. I told her she could look at the grant lists of organizations like GlobalGreenGrants, The Goldman Environmental Prize, The Gordon and Betty Moore Foundation, her local community foundation, the Environmental Grantmakers Association and other funders of the environment to see if they had information she could use.

If she'd been looking for new ideas I would have sent her to those funders' lists above and to GlobalGiving or perhaps this new site I just learned of - SeeYourImpact. If this post from Sean had been up last week I'd have sent them to it.

All of this was helpful and rational. But not particularly emotionally satisfying. And if you are trying to get a 10 year old to do something there had better be some kind of fun or emotional hit or direct feedback to the kid. Otherwise giving is going to be like doing homework.

We talked about what she was hoping to accomplish by doing this with her 10 year old. She wanted him to make giving something he always did and would always plan for. She wanted him to gain some awareness of how different organizations do their work. And she wanted him to begin understanding how complicated and interconnected the issues of environmental health, animal habitat, and human health really are.

I gave her the following advice - send her son to the websites of each of the organizations on her list. With a pen and paper. Give him 20 minutes per site to answer the following questions:
  1. What does the organization do?
  2. How do they do it?
  3. How do they know if they are making a difference?
His task was to answer these questions for each organization. If he couldn't find the answers, she'd ask him why and what he thought that said about the organization. Then they'd look through the information they'd found and make some decisions. They could "balance their portfolio" with policy and advocacy and direct service organizations if they wanted. They could focus geographically, or by type of service, or by type of environmental issue.

I also asked him to take note of the organizations for which he couldn't find this information from their websites. I want him to email them and let them know what he did and what he could and couldn't find. Her conversations with her son, before, during and after his "research project" would probably be the most meaningful part of the effort in terms of her goals for him.

Throughout our conversation (or email exchange - which is how most of this transpired over the holidays) I kept thinking about how different this exercise was now than it would have been in 2000. So much more information. So much easier to access. All of it waiting to be found by a 10 year old (who is completely facile in finding information on the Internet, though still learning how to judge credibility). I'm still waiting to hear back from him about what he found, what he thought mattered, and how it influenced his decision making.

I spend a lot of time on the "rational" side of philanthropy so this was a great reminder of what the user experience of giving markets and nonprofit websites is like for others. I expect to learn a lot from my friend's son. Especially after explaining this all to my own 10 year old and hearing this from him: "Is 'overhead' what you call meetings? You go to so many meetings, Mama - I don't want to fund meetings. I want to help girls go to school in places where girls don't get to go to school." Talk about being put in my place.

Sunday, December 26, 2010

Philanthropy Buzzword 2010.10 - Giving Pledge

Nothing says philanthropy in 2010 like "The Giving Pledge."

Well, except maybe the depressing reality that more Americans than ever before say they can't give to charity this year. Or that most of us will be doing our best to give the same amount we gave last year and many of us have no choice but to give less.

I had to move this to the top of the list, just based on the number of Google hits - (9,570,000 ), intensity of sycophantic posts about it, and its role as discussion starter.

Here's the year's entire list:

2010.10 - Giving Pledge
2010.9 - Markets for Good
2010.8 Crowdfunding
2010.7 - Chugger
2010.6 - Co
2010.5 - Charity washing
2010.4 - Curator
2010.3 - Networked
2010.2 - Sector Agnostic
2010.1 - Scale

Sunday, December 19, 2010

Two great books from 2010

Rebecca Skloot, The Immortal Life of Henrietta Lacks
Jaron Lanier,
You are not a Gadget

I wrote this in mid June and never posted it for a reason that I can no longer remember. Last week Jed Emerson called me and asked me if I'd read Jaron Lanier's book and/or blogged about it. I pulled this off of the hard drive to share with him and thought perhaps others might be interested.


The shifting domains of public and private

“What is public, what is private and who decides?” has been the guiding question behind my work for twenty years. It shaped my decision to go to graduate school, it shaped my dissertation, and it shapes my work today. I got involved with philanthropy because it allowed me to think about private resources and public systems. If I were leaving graduate school today I might very well opt to work for a social networking company, a medical research firm, or someplace I could talk about Wikileaks all day – the questions of public and private have become mainstream.

In trying to make sense of two very different books, The Immortal Life of Henrietta Lacks by Rebecca Skloot and You are Not a Gadget, by Jaron Lanier, I realized the question of public and private was at the heart of both books. Skloot’s book is about race, class, and medical research. Lanier looks at technology, music, web 2.0, social networks, and the demise of the middle class. But both are fundamentally about the changing relationships between public and private.

Henrietta Lacks was a working mom of five children in Baltimore in the early 1950s when she was first overtaken by severe abdominal pain. The pain led her to the hospital at Johns Hopkins University, which at the time provided most of the area’s care to the poor. It also served both blacks and whites. Lacks was diagnosed with cervical cancer and treated with radium. Before she died, and again afterward, the doctors providing the treatment took tissue samples of the tumors. From these tumors came the first human cells to ever grow outside of a body.

These cells (named #HeLa – for Henrietta Lacks) eventually contributed to most of the major medical breakthroughs of the next 60 years, including the polio vaccine, AIDS treatments, cancer drugs, and HPV vaccine. No one asked Henrietta or her family if they could use her tissue for these purposes. Over the next 50 years Henrietta’s descendants would both be ignored and hounded by medical researchers, reporters, and charlatans. They would be dismissed as profit-seekers, ignored by those with higher educations, refused medical treatment for lack of insurance, and lied to about medical tests performed on them. Henrietta’s cells have become immortal, and influenced medical research and patient practice. Henrietta’s family has been lied to, used, and, occasionally recognized, for the role these cells played. All of us, as patients, potential tissue donors, and users of over-the-counter and prescription medicine have benefited from the systems, companies, and practices that evolved from Henrietta’s immortal cells.

At the cellular level, we all look the same. As one cancer researcher explains to Henrietta’s daughter in answer to her question about why the cells aren’t black if her mother was, “Under the microscope, cells don’t have a color. They all look the same….You can’t tell what color a person is from their cells.” (Skloot, location 4316, Kindle edition)

Jaron Lanier’s You are Not a Gadget looks at how we're also starting to all look the same on the Internet. He deals with the dehumanizing nature of the Internet, emphasizing that we have done this to ourselves. As we all answer the same Facebook question, fill in the same data fields about ourselves, and willingly contribute our ideas for free to aggregators such as Twitter and Facebook, we collectively devalue ourselves. No wonder, says Lanier, that writers, photographers and musicians struggle now to make a living practicing their crafts – what was once primarily private creativity is now a project of the “hivemind.” Private creation becomes less and less possible as the public stage of social networks becomes ever more pervasive.

As I read Lanier’s argument I felt as if he were pointing right at me. I am a user and supporter of Creative Commons licensing, even as I occasionally feel bitter that someone is quoting me without attribution. Through this blog I have given away most of my relevant professional thinking for the last eight years, building a consulting practice that feeds and support it. I have done the math to make the business model work, but I have not seriously considered the degree to which my “non attributable” thinking has made it harder or easier for me to lay claim to my ideas.

Lanier’s most compelling point focuses on how technology manages us. Anyone who has ever trained a dog knows what he means. When you use treats to train a dog to be quiet your first thought is “Wow, look how smart this dog is.” Then you mistakenly think, “Look at what I can do.” And finally, the 5000th time you reach for a treat when he barks you realize what has been going on all along, and you realize, “Wow, look how smart he is. Look what he can make me do.”

Just as we think we are training the dog (and not vice versa), we tend to think we are in control of the technology we use. Lanier points out the degree to which the design decisions made by coders actually affect the ways we work. The obvious one is twitter with its 140-character limit on our wisdom or pithy insights. But the truth is that all technology, at both the interface and the functional level, influences how I express myself. And influence the way you listen and respond to me.

The cumulative impact of web 2.0 has been to accelerate the rate at which we blur ourselves with machines. Lanier decries the effects of thinking about the Internet as conscience creature. He bemoans and belittles the hivemind, swarm mentalities, and purely public, shared creativity. In so doing, he encourages us each to reclaim some of our private thinking and creative spaces, our own ideas, and our ability to control them.

In the decades since doctors took cells from Henrietta Lacks, the medical profession, individuals, and U.S. courts have struggled with the idea and implementation of informed consent. Despite case law, HIPPA, and patients’ bill of rights, there is no standard legal answer to the question of who owns our tissue once it is taken from our bodies. Some researchers argue that fully informed patients will bring medical research to its knees and create a marketplace of profiteering body part salespeople. Others see exactly the opposite truth, and point out the following irony: “It’s illegal to sell human organs and tissues for transplants or medical treatments, but it’s perfectly legal to give them away while charging fees for collecting and processing them.” (Skloot, location 5266, Kindle edition)

Skloot argues that the “tissue rights” movement may be the next big social movement. Could there be any more intimate a petri dish than this in which to consider questions about who decides what is private and what is public? And if the intimacy of cells and body tissue is too close, Lanier raises the same question on a global scale. In this age of social networks and sharing, are we giving away our individuality in creating these vast repositories of ideas, material, music, and thoughts?

One of the scientists in Skloot’s work says we all owe something to the public good, and should view the medical community’s use of our tissues with this in mind. Even as I readily give away my thoughts on this blog and benefit from medical research on human tissue I find this viewpoint troubling. Are my thoughts and ideas the same as my tissues? And what about Lanier’s concern, that we now so readily give our thoughts to the public sphere that private ideas are harder to create, find and value. True? Overblown?

Is the my confusion caused by the difference between material (cells, tissue) and ideas? It can't be that simple - as economic artifacts cells that reproduce outside of the body are quite similar to ideas. They both get more valuable as used. They can be reproduced without diminishing the original source. Does it have to do with consent and control in different types of markets? With issues of control and expertise? Or just fluid definitions of public and private? Maybe I am just intellectually inconsistent.

Skloot may be right that the tissue rights movement will be the next great social movement. If so, we will become even more familiar with these questions of public and private. Lanier argues that we are not gadgets. Skloot asks us if we want to be petri dishes. Both books make us think hard about our private abilities and our public obligations.

Saturday, December 18, 2010

Predictions and strategy

Here is a video of Matt Bishop of Philanthrocapitalism fame putting forward his predictions for philanthropy.

His list includes a rise in online citizen philanthropy, bad news for microfinance, rise in impact investing, Steve Jobs signing the Giving Pledge, boom year for education giving, down turn in government aid, and increased awareness of social capital markets. You can compare his calls for the year with my annual list in the Blueprint 2011, the next decade here, and my list of buzzwords from 2010 which sets us up for 2011.

Most interesting, in my opinion, is Bishop's sense there will be more attention on policy issues, not just from big givers but also from the rest of us. This would be a good thing, if it comes to pass.

I'd like to point out that the very fact that Bishop highlights education and maternal health as two "hot areas" for giving in 2011 is indicative of the limits of philanthropy as a solution. Global solutions don't lend themselves to "annual hot lists" - as I noted here. This blog received a comment from a reader that said: Planned giving and philanthropic leadership are the need of the hour as many countries are crisis-ridden."
My response "... I think it is a fallacy to equate anything you would describe as “crisis ridden” with “philanthropy” as a solution. Philanthropy is – by design – episodic, donor directed, temporal, fragmented, decentralized and disaggregated. Not what any people, society, institution, community should expect to be responsible in “crisis ridden” situations."
Those same characteristics shape the kind of impact philanthropy can possible have on ongoing issues such as education and maternal health or whatever the 2012 issues of the year will be. We don't help anyone by pretending otherwise. It's not to say that philanthropy can't make a difference. It is to say that we need develop philanthropic strategies that draw from the strengths of philanthropy and don't burden it with being a long term, equitable, prioritized source of funding or attention.

Wednesday, December 15, 2010

Ten for the next 10: 2010 - 2020

(Cross posted on the Stanford Social Innovation Review Blog)

(photo by alykat, Creative Commons, attribution, non commercial)

Earlier this year, I took a look back at my decade of predictions, 1999-2009. You can find that online here. I've also published my annual forecast for what will matter in philanthropy and social investing in 2011 - you can find that online here (use the special SSIR discount code)

I'm an historian by training so I can't help but think in decennial terms - the 70s, 80s, 90s, etc. We're wrapping up the first decade of the 21st Century. Everywhere you look you can find Top 10 lists. I've got my own going - the annual roundup of Philanthropy Buzzwords can be found here. We're up to #8 (crowdfunding). We'll get the last two posted before December 31st.

With this post I'm going to take a slightly different tack on the end-of-year ritual top 10 lists. Rather than focus in (anymore than the buzzwords list already does) on the top 10 of the year gone by, let's think about the factors that will shape philanthropy for the decade ahead.

Here are my premonitions on what will become familiar in philanthropy in the decade to come:

1. The rules will change - federal tax law, nonprofits and politics, municipal and state tax exemptions, IP regulations, B corporations and the entry of the SEC into social investing - by 2020 philanthropy in the US and trans-nationally is going to be operating under fundamentally different rules.

2. More spend down foundations - as the wealthy get more active in philanthropy at younger ages I expect more of them will set time-limits on their foundations. After all, if you start giving away your billions in your twenties you've got as many years left ahead of you as most of the nation's perpetual foundations have behind them.

3. Gaming and game pedagogy will be built in to problem solving - And foundations, philanthropists, and change making organizations will be using these structures and incentives to address everything from obesity to art creation, from public policy debates to conserving energy.

4. Disaster relief giving will be more structured and planned - Weather forecasters and scientists are predicting a dramatic uptick in natural disasters, especially those that are weather related. Efforts to organize and plan for these disasters will take hold. New mechanisms for individual disaster response giving will exist.

5. Impact investing will surpass philanthropy - Total giving in the USA increased by about 50% or $100 billion in the last decade. The 2000 number (as reported by Giving USA) was $203 billion and the 2009 working number is $303 billion. If that rate of growth continues over the next decade we'll hit $450 billion in total giving by 2020. Meanwhile (admittedly self-interested) predictions of impact investing peg the a potential investment opportunity between $400 billion and $1 trillion.

6. Institutional philanthropy will be more collaborative - the generation that will be key professional staff and the donors behind major new foundations in the next decade are used to "spending other people's money," "leverage," and "real time collaboration." I think we'll see foundations working more deliberately through networks, in joint funding, and through syndicates.

7. Data analysis and visualization will be key skills for philanthropists - Communications and evaluation were the two "add on" departments of foundations in the last decade. Learning got a lot of play as an important skill. New data tools and products specific to philanthropy started to appear in the last year or so. Smart program people who can use data, make sense of it, and help foundation's communicate their own data through analysis and visualization will be the key going forward.

8. Foundations and nonprofits will still be here - There will be all kinds of other ways for donors to use their dollars for good, but they will still be starting new private foundations. Most of the foundations that exist today will exist in 2020, as will an amazing percentage of today's nonprofits.

9. Mobile phones will replace credit card donations. We'll look back and laugh at the idea of entering credit card numbers into web sites. The mobile revolution is more than text giving. Our phones (handheld computers) will be our point of access to the web and social networks, communications systems, volunteering tools, and wallets.

10. Scale will have a networked meaning. Scale is one of the buzzwords of the last decade in philanthropy. By 2020 ,we'll have given up our misconception that "scale = big" and instead be focused on "scale = networked." We will have recognized that problems get solved through "small pieces loosely coupled."

In the generous spirit of the season, here are some extra thoughts.

11. "Impact economy" will replace "social sector" as the term of art.
12. Foundation leadership and boards will not reflect the racial, ethnic, or gender makeup of the nation.
13. China and India will be atop global philanthropy leader boards.
14. There will be a multinational oversight organization for global philanthropy or social investing.

What do you think will happen by 2020? What will philanthropy look like? What can we barely imagine today that will be commonplace by then? Let us know in the comments and have a great year ahead.

Sunday, December 12, 2010

Philanthropy Buzzword 2010.9 - Markets for Good

Last year Impact Investing topped the buzzword list. This year we've expanded from the changes in investing to the larger markets of which they are a part. The phrase "Markets for Good" got its biggest push at this year's SoCAP conference, but the idea has been around in various forms for some time.

Markets for Good - (noun, pl) - The mix of financial mechanisms that move private resources to public goods. Current financial tools in the marketplace run from giving to impact investing.

The philanthropy buzzword 2010 list so far:

2010.8 Crowdfunding
2010.7 - Chugger
2010.6 - Co
2010.5 - Charitywashing
2010.4 - Curator
2010.3 - Networked
2010.2 - Sector Agnostic
2010.1 - Scale

Saturday, December 11, 2010

2010 Publications

Ah, December, time to reflect on the year gone by.

2010 was wonderfully productive on the writing front. Thanks to everyone who contributed to and used Disrupting Philanthropy, the breakout publication of the year. But it wasn't the only thing I wrote - here are several other publications from the last twelve months.

The MacArthur Foundation Series on Field Building:

Changing the Ecosystems of Change

Building Fields for Policy Change

Border Crossing: Working Across Sectors for Social Purpose

Building to Last: Field Building as Philanthropic Strategy

In addition to the above papers in the MacArthur series, I also published the following:

Disrupting Philanthropy: The Future of Technology and the Social Sector

In Philanthropy UK Newsletter, Alliance Magazine, Alliance article on banks and philanthropy.

Philanthropy and Social Investing: Blueprint 2010 (Kindle edition, sale price)

Philanthropy and Social Investing: Blueprint 2011 (preview)
Philanthropy and Social Investing: Blueprint 2011 (purchase)

You can find several other papers, speeches and databases on my Scribd page. Presentations are posted on Slideshare.

Video - from the DataJam, Foundation Center and NYU Heyman Center (forthcoming)

Audio - including inaugural Foundation Center #Glasspockets Podcast.

Phew! Can't wait for 2011.

Sunday, December 05, 2010

Philanthropy Buzzword 2010.8 - Crowdfunding

Crowdfunding. - the latest buzzword for philanthropy and social enterprise

Crowdfunding is the "magic" behind Kickstarter and IndieGoGo - post an idea, activate your networks, and see if you can raise small bits of money from as many people as possible to meet a funding goal. Crowdfunding is linked to a technology platform that lets you highlight certain projects, share information easily, link and make badges and crosspromote easily. It also can have an offline component - as seen in community fundraising efforts like Feast.

You can join a conversation about crowdfunding business models with Sam Beinhacker and Josh Tetrick at #SocialEdge discussion on crowdfunding.

WebDistortion provides this review of 9 Crowdfunding sites including Kickstarter, IndieGoGo, ProFounder, CoFundOs, and others.

Wired Magazine recently reviewed crowdfunding for science. These sites include SciFlies, EurekaFund, and FundScience. Wired also did a piece on crowdfunding photojournalism.

If you're keeping track here are the other 7 1/2 buzzwords so far this year. (We have a bonus buzzword - Chugging/Chugger 2010.7a - In honor of the new Voluntary Sector network on The Guardian UK . I ran my first post over there last week asking "What will change everything in philanthropy?"

2010.7a - Chugger
2010.7 - Giving Pledge
2010.6 - Co
2010.5 - Charitywashing
2010.4 - Curator
2010.3 - Networked
2010.2 - Sector Agnostic
2010.1 - Scale

Thursday, December 02, 2010

As interesting as it gets?

My first post for the Guardian UK Voluntary Sector Network is up - take a look.

And let us know in the comments there what you think will change everything.....

Tuesday, November 30, 2010

The Future is Here

Philanthropy and Social Investing: Blueprint 2011 is now available. Please click here to purchase your copies. We'll also be hosting seminars on the forecast starting in January. Stay tuned for more information on those.

Want a sneak preview of Blueprint 2011? Here you go:
"In the first section of this Blueprint 2011,“Changes that Matter,” I highlight elements of the Supreme Court decision in Citizens United v. Federal Election
Committee that will have significant implications for nonprofit activities,
organizational structure, and revenue sources. I also look at the set of choices that all donors, big and small, are now navigating. The mainstreaming of mobile giving, while not as grand a change as the preceding two, shows us that technology continues to offer new tools.

In the second section, “Forecasting 2011,” I make three forecasts about this social landscape. For 2011, I expect a very slight increase in giving, the first uptick since 2008. I also predict that social investing will expand and become ever more mainstream. Finally, I look at consolidation of online giving markets particularly and examine the implications of consolidation for doers and donors.

The next section, “2010 Revenue and 2011 Projections,” synthesizes data from several sources about philanthropic giving, social investing, and public sector (U.S. only) funding for the social landscape.

Finally, I present a “Glimpse of the Future” and highlight the kinds of choices all of us will face in the coming year(s)."

- From the Buzzwords list in Blueprint 2011

Sector Agnostic: Funders who make both social investments and grants and who work with both commercial and nonprofit partners describe themselves as “sector agnostic.” They are
interested in solutions, not the tax status of their organizational partners.

Blueprint 2011 includes a section that tells you what I got wrong about the year gone by. You can find that at Renovations to the 2010 Blueprint. You'll have to buy the book to find out more!

Monday, November 29, 2010

The real online revolution in giving

For all the talk of Web 2.0 (and even 3.0), philanthropy online has evolved fairly slowly since the dot com days. First we got big, red Donate Now buttons on every website. Then donation sites such as GlobalGiving came along to provide vetted projects and charitable options for donors. The next iteration came in the form of JustGiving and CrowdRise which let everyone be a fundraiser. As mobile phones became a popular way to access the web and texting surpassed talking we got text giving and location-based organizing.

For the last year or so the focus has been on social networks as the places where we'll conduct most of our future web activities. The theory is that we're becoming more and more comfortable sharing information with our networks of friends. The next step is relying on those networks for all kinds of recommendations and advice, including charitable suggestions.

Is this as interesting as it's going to get? The first few iterations of charities and the Web - the donate now buttons and the giving sites - actually made it easier for donors to find organizations they may not otherwise have know about. Making it really easy to manage an online fundraiser got us engaged in ways most of us wouldn't have taken on otherwise. These changes in the giving space - along with a growing awareness of data as a public resource, calls for more effective charitable giving, and the rise of organizations such as New Philanthropy Capital, actually took us a few steps closer to more rational and informed charitable giving.

By relying on our networks of friends to advise our donations we're hardly taking a step forward in the use of data, comparative metrics, or outcome based analysis of charities. We're actually taking something of a step back. We've always relied on our friends to guide us to charitable activities - well before there was a laptop or a donate now button we gave to the organizations we knew, we gave when asked, and we supported issues that our circles of friends and families knew about.

Most of this first era of technology for giving and organizing has mimicked our offline behaviours. There are two current developments in online giving that are worth watching as signs of future changes in giving behaviours.

The first is Kickstarter. A New York-based startup, Kickstarter is a way for anyone to "find" or "fund" a creative project, whether it be an art installation, a movie, a new magazine, or a concert. In terms of web tools, the site is completely social - it's built for tweeting, emailing, sharing, and interacting. But what makes the site indicative of the future is that the projects are not all charitable. Some are commercial ventures. Some are designed as one-off efforts, others are part of ongoing charitable and cultural endeavors. Old organizational distinctions between charitable and commercial are not assumed on Kickstarter. Creativity may be either a charitable or a commercial act. Funds to support it may be tax deductible or not. The old sector distinction no longer holds.

In the UK and elsewhere, this blurring of commerce with public mission is the realm of social enterprise, Community Interest Companies, and social investments. To see it mixed in with charitable giving on a website, treated as an afterthought to each project's potential accomplishments as it is on Kickstarter, is indeed indicative of a mind shift.

The second site of note is MissionMarkets. In the ten year childhood of web-based philanthropy and social enterprise, the holy grail has been a fully-realized online investment exchange for social businesses. Such a platform, iterations of which are under development in South Africa, Singapore and London, are seen as the gateway to broad public investment in social enterprises. MissionMarkets is not quite there - currently it's a site for registered investors to place private deals only. But MissionMarkets' beta launch gets us one step closer to a regulated exchange for equity investments in social enterprises.

These two sites - Kickstarter and MissionMarkets - are most meaningful for the futures toward which they point. Both apply the power of the web to raising new money for public benefit projects. Kickstarter recognizes that the defining characteristic of public benefit is no longer captured by classification as a nonprofit. MissionMarkets is a functional expansion of the funding universe for social enterprises, a step toward the broader goal of investment exchanges. In both cases, the technology is being used to expand and expose shifts in our offline assumptions about where good happens. Far more significant than how well the sites use the latest software or gadgetry is how well they reflect societies' assumptions about how to make change.

Sunday, November 28, 2010

Philanthropy Buzzword 2010.7- Chuggers

The Giving Pledge (Buzzword 2010.10) might be considered the "high" of buzzwords. So here's the low - Chugger and Chugging. In honor of the new Voluntary Sector network on The Guardian UK - this is an imported Philanthropy Buzzword 2010.7 - Chuggers / Chugging.

Chugging is a British portmanteau of Charity and Mugging. It refers to the tag-team clipboard-wielding signers-for-hire fundraisers who've staked out almost every city block these days. "Have a minute to save the whales?" "Give a minute to save the children?" "Take a minute for human rights?" "Got a minute for gay marriage?" They call out as you feel guiltier and guiltier about your walk to lunch. If you do stop they'll take far more than a minute - they'll keep talking to you until you surrender your name, address, and a donation. If you give them the first two, you will be bombarded with requests for the third.

A 2009 survey in Britain showed that 2/3 of people crossed the street to avoid these folks and 1/4 lied to them about having "given already."

In California, a state where ballot initiatives have replaced and run over representative democracy, you might avoid a chugger only to be stopped by another clipboard. This one is also wielded by someone getting paid by the signature - asking you to "balance the state budget-throw the bums out-fix Sacramento-sell bonds for the high speed rail/new prisons/ school and hospital facilities while approving pay raises for elected officials." And, of course, when you finally get past the chuggers, and past the petition-signers and get to the deli to buy your lunch, you'll be asked to "round up" your check for charity.

Ho Ho Ho.

Wednesday, November 10, 2010

The market of philanthropy advisers

I recently completed the cognitive juggling act of simultaneously reading Alliance Magazine's very thoughtful issue on philanthropy advisers while listening to the video stream of the Edge discussion on "What will change everything?" at the Genoa Science Festival.

The September 2010 issue of Alliance features articles from Melissa Berman, Felicitas Von Peter and Olga Alexeeva - three of the most accomplished, creative, and globally connected advisers in this space. They've all been instrumental in formalizing, expanding, and setting standards of practice for advising the wealthy about their giving in major regions of the world (the U.S., Europe, the U.K. and Russia). They raise important issues for the professionals in this space and the clients who will use their services.

Philanthropy advising as a service is becoming institutionalized, professional, and better. It will probably soon be held to certain standards, may become focused on impact rather than asset management, and there will be a move to professional accreditations. There will be a scandal or two. There are real ethical challenges - such as those raised by Caroline Hartnell in this article, in which the business interests of some advisers seem to be at odds with both the client's interests and what is "best" for the field. Ethical standards, clarity about the business interests of all involved (as with other financial advisers), and consumer education about what kinds of advisers do what can only help. There will be new tools and alliances that tie together the donor networks, the explicit data on change, and the trusted advisers. Philanthropy advising has been growing the way many industries do and the article in Alliance marks the moment in which it became publicly self-aware.

Which is somewhat funny, because the more I read in the magazine the more I kept thinking there was something missing from the story. In 2010 I shouldn't be able to read a snapshot of an emergent industry and come away feeling like the future of that industry is pre-ordained to follow the same trajectory that Michael Porter and others identified thirty years ago. The examples, practices, and issues raised in the Alliance feature section collectively sound as if philanthropy is still offline, only the rich, and only slightly concerned with investing. That's not where I think philanthropy is now or where I see its future, and so it's not where I think the future of advising will be.

I kept thinking that the future of philanthropy advising is peer-to-peer. (By the way, it's also part of the past of philanthropy advising). One of the amazingly underestimated elements of the Gates/Buffet Giving Pledge is the way in which it flat-out demonstrated what we've always known about giving - when a peer, a friend, or a family member asks you to give, you give. Gates and Buffet asked their peers to give (most of whom already were) and they did. In the model that has always been with us, and the model that the Giving Pledge brought to a new level, a person asked a person to give and they gave.

One of the few really big gifts this year - Mark Zuckerberg's $100 million to Startup:Education is classic peer-to-peer philanthropy advising. Zuckerberg turned to his Facebook COO, Sheryl Sandberg, who turned to her networks to find an opportunity that met the donor's interests. More formal versions of these peer network advisory structures include the programs of TPW-W, Legacy Venture, Synergos, Bolder Giving, Social Venture Partners, and Global Philanthropy Forum. There may be service providers, evaluation vendors and professional advisers in the mix, but the learning, ideas, partnerships, and even finding trusted advisers happens through these peer networks.

Peer to peer philanthropy advising is what is being built with social networks, many-to-many communications strategies, and globally connected datasets. It includes the "askers" and the advisers. It includes what I call the "doers" and the "donors." It includes the tweets and blogs on how to give to disasters, how to find the right giving vehicle, the data on nonprofits, the online communities talking about social entrepreneurship and re-creating social finance. At this moment, peer to peer philanthropy advising is a hodgepodge of smart folks and charlatans, of blowhards and thoughtful experts, of those looking to make a buck and those looking to make a difference. It will be these networks of peers that professional advisers - whether they are selling a bank's services or independent evaluation or research - need to service in the future.

The cost of entry to becoming an adviser - formal, institutionalized and working with the world's wealthiest - or informal, online, and iterating as you go - is almost negligible. While those featured in Alliance Magazine are going through the very important industrial life stage of maturation, the rest of the field is still a scatter plot of providers, practices, tools, advisers, and products. From the Alliance feature, we get one side of the story - the traditional narrative of financial innovations over time, in which the services and products developed for the wealthiest are first experimented with, than standardized, and then repackaged to trickle down to mid market when the costs are right.

But in our world today, where data are increasingly commodified and analysis/synthesis/expertise increasingly dispersed - the innovations from the bottom will - and should - affect the thinking of the top. Networks can generate more ideas, vet more ideas, and provide a more robust feedback process than any single adviser. They can mix experts and crowds. They can make sense of data in ways that individuals never will.

In Genoa, Clay Shirky answers the question of "What will change everything?" with "coordinated voluntary participation." He uses an example from the Polymath mathematics community - where the world's smartest mathematicians are upending centuries of professional practice to solve their field's longest standing, unsolvable problems. The story is not about the math but about how the math is done.

For philanthropy advisers, the parallel is to think not just about the philanthropy but how the philanthropy is done. And philanthropy - the long tail that provides the bulk of the private resources for public good - is all about "coordinated voluntary participation." How can the on-the-ground wisdom of long tail influence the wealthiest givers? How can the expertise and research that the big foundations pay for be used by the rest of us?

Monday, November 08, 2010

Citizens United and new rules for Nonprofits

(Cross posted on the Stanford Social Innovation Review)

The most important task for the social sector in the United States in 2011 will be to understand the effects of the Supreme Court’s decision in Citizens United vs. the FEC.

This decision removed prior restrictions on independent spending by corporations and unions on election campaigns. The immediate result of the January decision was to unleash a flood of money to advertising in support of or opposition to ballot measures or candidates. Most of this money was channeled through certain types of nonprofits.

Much has been written about the political and financial impact of Citizens United on election campaigns. Immediately following the elections on November 2, 2010 estimates the independent expenditures totaled at least $450 million, more than twice as much as was spent in 2006, the last midterm election.(Data from Sunlight Foundation) This includes at least $126 million from nonprofit organizations that do not have to disclose their donors.

There is some very important work being done, by groups such as the Center for Political Accountability, Voter Action, and Democracy 21 to address the questions raised by these undisclosed donors. Strategies for dealing with the flood of corporate money to politics that is being "laundered" through these nonprofits include:

  • Encourage corporations to disclose their contributions as a sign of good governance - there is great work being done on this front by Center for Political Accountability through lists and standards of best practice
  • Use shareholder resolutions to encourage corporations to disclose their contributions - these give individual and institutional shareholders the opportunity to guide the corporations toward good governance
  • Support efforts to pass the DISCLOSE ACT, which failed in the Senate in March 2010
Citizens United has shifted the legal landscape for nonprofit political advocacy. The years to come will be shaped by legal battles to define new practice within these bounds, continued legal battles which might further extend the Citizens United precedent, and many new actions within the world of voter rights and campaign finance reform.

The aftershocks of Citizens United include the start of a period of testing, trial by error, and new case law to determine what rules now apply to 501(c)(3) nonprofit organizations. This may please some and anger others, but there will be period of confusion for everyone.

I'm interested in the impact of the decision on nonprofits as a class of organization and on the public perception of them, their reputational risk, if you will. This topic has received far less attention than the "money into politics" part of the equation.

First, as I mentioned in this earlier post, the subsection tax code
legal distinction that separate 501 c 3, c 4 and c6 nonprofits means little to the general public. According to The Washington Post, eighty percent of all Americans (regardless of political party affiliation) opposed the Citizens United decision by the Court. The confusion about the role of these organizations in the political process is important for charitable nonprofits to the extent that the public conflates political activity (which they may or may not approve of) with charitable activities.

Second, while Citizens United clearly removed limits on political expenditures it also raised the need for a new look at disclosure requirements for donors. Donors to political parties and political action committees must be disclosed by name within a reasonable amount of time. Donors to the 501 (c) (4) and (c) (6) groups do not need to be disclosed. Changing these disclosure requirements is of great interest to many activists.

The unintended consequences of changing disclosure laws need to be carefully considered. Some legal scholars believe that increasing the disclosure requirements on all donations will result in the Court eventually removing all restrictions on political spending. Others raise the problem of relying on “analog” disclosure requirements in a “digital” age and suggest that donor disclosure needs to be more frequent and timely where political contributions are concerned.

Finally, if new donor disclosure rules triggered by political giving are applied to all charitable giving, the shift would likely have a dampening effect on long-held traditions of anonymous philanthropy.

Donors may find themselves being asked to support an organization that does not do direct political work but that has an affiliate organization that does. As of 2010, tax deductibility and anonymity are still options for non-political contributions
- clarity of purpose and intention for the funds given will be key.

How is your nonprofit addressing these changes? How are your donor outreach activities affected by the news reports of "hundreds of millions of dollars flowing to election campaigns through nonprofits?" It may be soon to have full answers to these questions, but the nonprofit sector needs to be seriously considering the implications of these rule changes. As Abby Levine, legal director of Alliance for Justice put it:
"There are some organizations that recognize the ground has changed. We may never be able to compete with big business, but we need to be at the table. If we're not in the game, we're definitely going to lose."

Sunday, November 07, 2010

The history of the future

(Photo from

I'm an historian by training. At Stanford, I had the great honor of working with David Kennedy, who was both my teacher and a member of my dissertation committee. Kennedy is the author of several best selling histories of America in the 20th Century, such as the Pulitzer Prize-winning Freedom From Fear: The American People in Depression and War, 1929-1945 and Over Here: The First World War and American Society. Needless to say, I am a big fan of Professor Kennedy's work.

Professor Kennedy has an opinion piece in today's New York Times about Tuesday's election. In it, he notes the similarity between these results and those from the Gilded Age, the period that defined the turn of the last century (1880s-1910s). In the decades after the end of the American Civil War into the start of the 20th Century Kennedy notes that we had presidents from one party and congressional control by the other party far more often than we had single party control of both the executive and legislative branches. He refers to the kind of election we just had, where there is a massive shift in party control, as a "wave" election and notes that they reflect periods of uncertainty and resetting. He notes:
"So perhaps the stasis of the Gilded Age and the stalemate of our recent years reflect not so much the defects of our political structures as the monumental scale of the issues at hand. From that perspective, “wave” elections mark a necessary stage of indecision, shuffling, avoidance and confusion before a fractious democratic people can at last summon the courage to make tough choices, the creativity to find innovative solutions, the will to take consequential action and the old-fashioned moxie to put the ship of state again on an even keel."
Kennedy further notes that the Gilded Age eventually gave way to the Progressive era and great Presidents from both parties. In particular, Professor Kennedy writes:

"Eventually, leaders emerged in both major parties — most conspicuously the Republican Theodore Roosevelt and the Democrat Woodrow Wilson — who breathed vitality into the wheezing political system and effectively initiated the tortuous process of building institutions and writing laws commensurate with the scope and complexity of the society over which they presided. (My emphasis added)

This is the challenge we now face. In so many areas of life, we are trying to thrive within rules written for a different time. I won't go into the areas beyond philanthropy where this applies, but they are many. Where philanthropy and the social sector are concerned, we are very much trying to make do with rules that no longer hold.

The Citizens United case, about which I have a post on the Stanford Social Innovation Review, is one harbinger of new rules for the social sector vis-a-vis its relationship to advocacy and election politics. The for-benefit corporation laws (B Corporations and others) and the L3C movement, are "shots across the bow" for a new era of corporate law regarding the production of social goods. The creation of social finance and social investment exchanges and the ways these forces draw securities regulation into the equation for funding social goods is probably the the next place we will see massive shifts in law and regulation. Intellectual property, the Creative Commons, and governance of and in the commons, are also areas of law, regulation, and practice that hold promise for how we collectively produce social goods and threats to the established norms of nonprofit practice.

It is unsettling. We can't predict the future. We can't just hope that history repeats itself with great leaders of either the Rooseveltian or Wilsonian persuasion. But I believe we - all of us with a vested interest in a healthy, humane, culturally vibrant, and sustainable society - can do more.

We can use our current tools - as Kevin Kelly has done so creatively with his crowdsourced maps of the Internet - to spark conversations about what is and what we want. We can engage in civil debate and disagreement - as so many communities - from pop stars to college students, have with the "It gets Better" and "Make it Better" campaigns against bullying, violence and intolerance. We can actively seek to know "the other," as thousands of Jews and Muslims did this past weekend in a dedicated series of "religious twinning" services.

But what we also must do is actively consider the policies that shape the way we produce, distribute, and finance social goods. These are the rules that shape the game.

If Kennedy's read of history is accurate, and if this is a moment of such profound transition that we will only see it clearly in the rearview mirror, than what we need to be doing now is imagining what better could look like. How do we want services and social goods created and paid for? What can social business do and what needs an independent, civic infrastructure protected from the vagaries of politics and the motivations of a bottom line? What do the digital tools, the massive datasets, the communications instancy, the ability to combine crowds with expertise give us that our 20th Century forebears could not have imagined when they endowed great foundations, built public services, and codified certain practices almost 100 years ago?

We can only put new rules into place if we imagine them first. We're running up against old rules. There are examples aplenty of individual activism - from the Tea Party to Wikileaks - that are "first wave" reactions against the existing structures. Now is the time to start using that same combination of collective and individual to write the new rules.

Thursday, October 28, 2010

Make it easier to know than to not know

I've written a lot about data and data visualization. I believe that data are the new platform for change. I believe that data visualization should be about sense making not just the Wow! factor.

Of course, neither data nor data visualization are silver bullets. The data have to be good, clean, comparable, reliable, and open. The visualizations have to be accurate, credible, and contextual.
Even then, you have to be willing to use these tools and then change the way you work. For example, here's the latest whiz bang online tool - real time monitoring of water wells built by the group Water for The People. We can watch this cool app on our (android) phones to see which wells work and which ones don't. But what really matters is if Water for the People and its partners in Rwanda use the technology to keep the wells working.

See this wonderful piece by Clay Johnston on bad data visualization (he calls it "the lies visualizations tell.") Just because you have data doesn't mean you know anything. Just because you have a map doesn't mean you're an explorer. And just because you have data and cool visualization tools doesn't mean you'll make better decisions or be a more effective grantmaker.

For donors and foundation program officers, data and data visualizations have to meet an even higher threshold - they are going to have to make it easier to know something than to not know it. Right now, most of the structural incentives in philanthropy make it OK to not know what everyone else in your field is doing. Plus, it's hard to find out. Those two factors - making it necessary to know and making it easy to know - are big barriers to adopting these tools or changing the way foundations make decisions. Technology can make it easier to access data and easier to show the data in new ways. But unless the incentives for knowing and doing the work change, we'll have a lot of very cool tools that few will use.

A very nice new Strategy Landscape tool from The Center for Effective Philanthropy and The Monitor Institute proves this point. There's no magic in the pictures, no secret key in the data. What matters is the sense making - the collective effort to understand an issue in a new way, to know what your peers are doing, and to make funding decisions with that information at hand. The interactive demo lets you play with this very impressive visualization of data. You can "see" by foundation, by geography, by date and by strategy. Who funds energy efficiency in the Midwest? How much of the foundation's funding goes to that strategy? How do they define the strategy? These questions can all be answered by clicking and looking. No magic here - just good clean graphics and data that have been coded and categorized.

Let's talk about that last little bit. Cleaning and coding and categorizing data are tough things to do. They take time, money, expertise, and storage space. They require "definitional conversations" - what do you mean by "energy efficiency?" Doing this work to develop the Strategy Landscape tools means that Monitor consultants and staff from CEP will have to engage clusters of funders and help them through these conversations. This is not rocket science, but like all collaboration, it's not a walk in the park either. Some good comes from the process. People realize there are better terms for things and there is a way to avoid jargon. They find peers and potential collaborators. They may find an ally in making an argument for a certain approach that they've been failing to make before. That's all good. The Strategy Landscape tools will help with this.

Somewhat similar is a Social e-Valuator SROI tool being launched by the SVT group and an enterprise in the Netherlands known as Social Evaluator. The Social Evaluator Tool is a guided, online Theory-of-Change maker that yields common indicators and outcome measures and allows for the monetization of SROI. (Demo Video) Like the Strategy Landscape Tool it involves a cool website and some careful data coding and management. But mostly it involves thinking hard about what you're trying to achieve, identifying outcomes and indicators, and working together - as funders and grantees - to name, track, record, and report those things.

Both these tools show that 1) we have the data and 2) we have the visualizations. The hard part is changing how we work to share our data, think collectively, and put in the time and effort to hold ourselves accountable to outcomes.

There is another tricky part here. Public access to the data. The data that power the Strategy Landscape tools are foundation grants. These are publicly reported data. Anyone could download a lot of 990s and answer the questions that the Strategy Landscape tool answers for themselves if they the time and inclination. The tool makes it easy. But it needs to make it visible to those whose data is not yet included. It's a good first step for the foundations that provide the data to have access to the visualization, but what really matters is 1) letting others see it so they make strategic decisions from it and make their own visualizations, 2) let other data be added to it and 3) make the data storage solution accretive, so years from now you only need to fold in new data not do the whole thing all over again.

For the SROI tool, the data are different. They're subjective inputs from the funders and grantees involved. But these too should be public so that others can use them, improve and iterate on them. After all, if every group of funders needs to come up with its own proxy indicators for youth development outcomes what's the point? We need to get to a shared set of public measures, like the IRIS Standards.

Unfortunately, the default position on the data in both the Strategy Landscape tool and the SROI Tool is "not public." Those involved say they want the data to become transparent and open, but they can't start there. I think if they don't start there they won't get there.

If these tools are going to get used, get traction, get better, and be useful the processes that they inform need to be open. The data need to be accessible, machine readable, and mixable. The data are public and the tools are commodities. It's the knowledge and decision making from the data and the tools that really matter - and in order to fuel real change these need to be open. Otherwise, it remains too easy to not know, to not ask the hard questions, and not to hold ourselves accountable.