Wednesday, January 26, 2011

Mission Insurance

The following idea came to me in an interview with Melinda Penkava of NPR. The story was taped this morning - I'll post a link when it goes on the air.

Here's an idea for a social entrepreneur - mission insurance. Now that we have social businesses, social enterprises, and nonprofits all producing social goods we need some way of making sure that the good gets done. Some type of insurance to keep the profit motive (even if its just break-even financial sustainability) from overwhelming the social mission.

Why do we need this? First, history. The ongoing trials of for-profit higher education in the USA (which I noticed in their paid political advertisement against "job killing regulation" in today's New York Times prefer to call themselves "career colleges") and commercial microfinance in India, Mexico and elsewhere are ripe examples of financial motivations overtaking social mission.

Second, consumer protection - for both donors and customers of nonprofits and social businesses. From the donors' perspective we need something more than metrics and annual reports that cements the organization's commitment to social good. Nonprofits have typically relied on (been given a pass by) their corporate structure and the public accountability of their boards. I'd say both of these are not strong enough. Social businesses, particularly those that meet the standards of a B Corporation, are beginning to document and commit themselves contractually to social good. This is a step toward mission insurance, but the B Corporation* standards are written mostly to protect business owners, then the investors, then the customers. We need something that will work for downstream investors or donors.

And there is nothing available to ensure customers - be they the borrowers from a microfinance organization, the teen employed by a job training company, or the working mom seeking a new credential to better her job prospects - that the services they are getting are being designed and delivered with a measurable, enforceable commitment to bettering lives and communities.

Mission insurance - something that takes the organizational commitment of a B Corp, the public accountability and reporting of nonprofit governance, and anything useful we've learned about social return and social impact - and puts it together to protect the commitment to a long term goal. There you have it, my product idea for the day.**

* Full disclosure: My company, Blueprint Research & Design, is a B Corporation.

Tuesday, January 25, 2011

Constituent voice as a source of change

Did you know that Keystone Accountability offers a Free Feedback App? Check it out - you can get a customized survey to find out what your constituents (clients, partners, customers, users - whatever you call the people you serve) think of your work.

Keystone is a leader in the field of constituent voice. That's "fancy talk" for "What the customer has to say." They've been working with NGOs and NPOs for years to help the organizations listen to the people they serve. Now they're teaming up with Charity Navigator to put this information in front of potential donors.

This is critical. It matters if you are running an organization and it matters if you don't. It matters if you are looking to donate to an organization and it matters if you "just want to get something done." Technology is accelerating our abilities to act on our own, to connect with others and to make our opinions heard.

We're changing our behaviors to take advantage of this in many realms of life. We rely on our social networks to help us pick our shoes. We plan our conferences on wikis. We hear about mobile phone carrying farmers gaining influence in the marketplace. We debate how to calibrate the increasing role of SMS messages in everything from disaster response to election monitoring to overthrowing government. These are distinct activities centered around tech-amplified communications. But they all point to the way we communicate within our networks and beyond, for purposes both prosaic and profound.

More important than the technology are the conditions, attitudes, and expectations of the constituents and the powers that be. Keystone is helping international NGOs actively reach out, to seek feedback. They are helping organizations invite information and use it. This establishes a conversational attitude about the information that is shared. If you don't reach out, it's no longer the case that you won't hear from your customers. It's likely that may be 'sent' even more feedback - customers walking away and not coming back, unhappy constituents, failure to solve problems, and adversarial relationships with the very people your organization may need most. Whether or not you do anything with that feedback is up to you, but be certain of one thing - folks will be providing feedback.

As the Internet becomes ever more a part of how we work, share, shop, find information, and make change in the world this issue of feedback will become ever more important. A recent study by the Pew Center on the Internet and American Life found that online communications are quite embedded in how we go about "making the world a better place." As one of the report's author's noted, "Even in its absence, the internet seems to be a factor in the reality of how groups perform in the digital age."

We're already seeing this in cities - the use of the Internet for collective local action such as pothole fixing and neighborhood activism is well-documented. (see here, here and here for examples) As this story in O'Reilly Radar notes the Internet is becoming a new platform for collective action. All of this means that feedback is not only more necessary, you're going to get it whether you want it or not. So it probably makes sense to figure out how to use it.

The Pew study looked primarily at how people use the internet to get involved. The Keystone tools and reports look at how organizations can gather and use the opinions and expertise of their constituents to better serve their community. The analysis in both of the reports point to something grander than either study would dare claim at this point - so I will: the Internet is re-shaping how and where and with whom we make change happen. Feedback implies reaching out and getting something from the outside. But what's really going on here is that the outside has come inside and the inside has left the building

Monday, January 24, 2011

Webinars and Seminars

I'm pleased to announce that the seminar series that accompanies Philanthropy and Social Investing: Blueprint 2011 is underway. I'll be leading several invitation-only seminars hosted with regional associations and foundations beginning in February. The seminars are three hour working group discussions built around the Blueprint 2011 document and tailored to the particular needs and interests of the hosting communities or foundations. Foundation and Giving Circle readers can contact their regional grantmaking association to see if they're hosting a seminar. If not, please have them contact me. I'd love to come work with you.

On a related and lighter topic, that of buzzwords past and present, I'm delighted to join with Guidestar to offer a webinar on Ten (Predictions) for the Next Ten (Years) on February 9. Registration information is available here. The webinar will focus on these previous blog posts:

Friday, January 21, 2011

From "e" to "o"

It just occurred to me. The last decade was defined by the prefix "e" - ePhilanthropy, eDiplomany, eCommerce, e e e.

The next decade will be similarly defined by the prefix "o" for Open - oGov, oData, oPhilanthropy...

Just you watch....

Wednesday, January 12, 2011

Haiti - one year on

(email readers - please visit site directly to see video)

Inside Disaster Trailer from PTV Productions on Vimeo.

(Video from

One year ago today an earthquake devastated Port-Au-Prince and much of Haiti. Hundreds of thousands died, more were displaced. Lives, families, communities, infrastructure, businesses, schools, and government are still be rebuilt. What have we learned?

A new report from The Knight Foundation looked specifically at the roles of media and communications in responding to the disaster. The report is well worth a read. It notes that radio was - and is - the most important communications medium in terms of reach, cost, and accessibility to Haitians. New tools - including SMS short codes, crowdsourced mapping, and geo-tagging.

The report does a very helpful job of identifying what worked when new media startups and volunteer groups partnered with established disaster response organizations and government agencies. It makes recommendations for everyone - media, techies, donors, governments, and response organizations. You can get the full report here.

Two other interesting notes on looking back. First, I wrote about the Disaster Accountability Project - a watchdog for disaster efforts - back when I first learned of it. It's founder, Ben Smilowitz, has continued his 1 staff/100s of volunteer effort - you can find out more here.

Second, recent reports total the American philanthropic donations to Haiti at $1.4 billion. A big number sure, but less than that given for other disasters. (Here are some interesting breakdowns of who gave) You'll recall at the time the "big news" was all about text giving. Many people raised questions about how this new form of "rapid reaction giving" would play out in the long term. I posited then - and still believe today - the value of these tools is more about data and feedback loops and their utility in crowdsourced volunteer efforts than in actual fundraising. My one disappointment in the Knight report cited above is it doesn't look closely enough (for my interests) at the human side of the crowdsourced mapping, tool development, volunteer efforts that rose in awareness during the quake and are still going strong - such as CrisisCommons - one of the most interesting developments, I think, and one I'm still following closely.

Wednesday, January 05, 2011

Using Buzz to Understand History

(Reposted from The Chronicle of Philanthropy)

Buzzwords are fleeting things. They come in and go out, are first hot and then not. However, looked at over time, buzzwords also provide a useful rear-view roadmap of how we got here.

Taken together, the 10 phrases I have chosen to show the long steady rise in market-based solutions for social problem solving, technology’s infiltration of all things fund raising, and a shift in attention from local to global.

Following are the 10 philanthropy buzzwords that define the decade gone by. This story originally appeared in The Chronicle of Philanthropy.

Number 10: Donate-now buttons

Remember writing checks, stamping envelopes, and mailing off your donations? Way back in the 1990s that’s how we gave money. Filling in credit card numbers on a direct-mail appeal reply card was high-tech, just a notch above throwing your coins into the swinging red kettle.

Donate-now buttons on Web sites got their start in 1999 and really took off in 2001 when AOL, Cisco, and Yahoo started Network for Good.

Number 9: Prize philanthropy

It used to be the biggest philanthropic honors were those you couldn’t apply for - like the Nobel Prize or the MacArthur “genius” award. That all changed in 2004 when SpaceShipOne, a privately built and piloted craft, completed its second orbit of the earth and won the $10-million X Prize. Since then foundations and corporations have fallen over themselves offering cash prizes for social change. There are challenges for wireless news tools, clean-water carriers, digital learning games, and much more. Philanthropists love prizes because they don’t pay out until you solve the problem.

Number 8: Celebvocates

Nonprofits have always loved celebrity backers. Nowadays, star status requires that every movie actor, utility infielder, and aspiring politician find a charitable cause to love. Ceaseless, blatant self- promotion in the name of hungry children, sad diseases, and cute animals is ceaseless, blatant self-promotion we can all stand behind.

In fact, here-let me wear your T-shirt, carry your tote bag, and tweet a gift to your organization so you can take credit for my generosity.

Number 7: Microvolunteering

Mom used to bake cookies for the PTA and serve on committees for the church. Now she edits marketing copy for the local animal shelter while waiting for the bus and helps NASA identify craters on the moon during boring department meetings. Microvolunteering, the art of donating time in 20-minute increments, comes to us via our smart phones-which we also rely on to organize protests and tweet our bikeathon fund-raising totals.

Number 6: Philanthrocapitalism

Nonprofits should be more like businesses. Giving should be more like investing. And capitalism should be more creative just so long as it continues to let some people get crazy wealthy so they can give some of it back to others.

Philanthrocapitalism, a term coined by Mathew Bishop and Michael Green and used as the name of their 2008 book, celebrates the coming together of business skills and structures with a focus on solving the world’s shared social problems.

Number 5: B Corporation

For entrepreneurs trying to run businesses with a social purpose, corporate structure has been one of the persistent challenges.

Organize as a nonprofit and you’ll be forever capital constrained, organize as a commercial enterprise and you risk losing your mission to investors. Since 2006, a group called B Lab has enabled B corporations (the B stands for benefit) to gain traction around the country and lead a revolution in corporate operations. Corporate code may not be sexy, but these new efforts stand to attract billions of dollars in new investments in social businesses.

Number 4: Impact investing

Impact investing is the active form of socially responsible investing- seeking out commercial investments that return social good and profits. First named in 2008, this marketplace is estimated to grow to $1-trillion in opportunities by 2020. In the midst of global financial collapse the impact-investing realm did more than keep its head above water; it grew in both name recognition and assets.

Number 3: Embedded giving

A pejorative term for cause-related marketing, a term of art coined in 1983 to promote a campaign to repair the Statue of Liberty, embedded giving describes this decade’s approach to adding charitable donations to sales transactions. Choose one iPod over another to give to AIDS?

That’s embedded giving. During the holiday season that just wrapped up, there was no escaping the pressure to add a dollar to your checkout total or buy Aunt Martha the sweater that will help save the seals. Embedded giving is great for retailers, even if the jury’s still out on how well it serves good causes. And the seals? Well, they don’t care what sweater you wear as long as you stop eating all their fish.

Number 2: Microfinance

Thirty years ago, Muhammad Yunus, a Bangladeshi banker, started lending money to groups of women with no collateral. In 2006 he won the Nobel Peace Prize for his work, helping to make microfinance a household world.

Today's field of microfinance is marked by hundreds of millions of dollars in investment, several IPOS by microfinance companies, and some scandal. Once the realm of nonprofits with large philanthropic supporters, microfinance is now a mix of commercial bankers and small donors. Sites like Kiva make it possible for anyone with a credit card to be a global lender.

Despite its enormous growth and cachet, we still don’t know how well microfinance helps the poor.

Number 1: Social entrepreneurs

In 2000 few people had ever heard of social entrepreneurs. Many would have defined a social entrepreneur as a very friendly business leader.

A decade later, Kiva’s founders are on Oprah, PBS, and NPR, universities offer degrees in social entrepreneurship, and U.S. presidents both present and past laud social entrepreneurs.

The universal reach of the term results from the legitimate accomplishments of leaders like Jacqueline Novogratz (founder of the Acumen Fund) and Muhammad Yunus and massive investments from philanthropists like Jeff Skoll and Pierre Omidyar. And it all builds from the work of Bill Drayton, founder of Ashoka, who introduced the term to the world back in 1980.

Forget the fact that no one can agree on a common definition, social entrepreneurs are still the hottest game in town and the buzzword of the decade.

What does the decade ahead hold? Look for the nonprofit world to become the “impact economy,” for the Securities and Exchange Commission to get involved in regulating investments in social enterprises, and for interactive data visualization to become the standout feature of effective nonprofit fund-raising pitches. More of my predictions for the decade ahead are here.

Sunday, January 02, 2011

Year's most creative fundraiser

(Poster on window of 826 Valencia pirate shop)

OK, OK - it's only January 2nd - plenty of time for someone else to claim this award. But in the meantime, 826 Valencia's Spelling Bee for Cheaters wins my award for funniest/most creative fundraising idea of the year.

Feel free to send me your suggestions over the coming 12 months for the funniest/most creative fundraisers.