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.

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