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The Awkwardness of it All: SoCap and the Nonprofit World

By Nell Edgington



I’ll give a full rundown of my Day 1 experience at SoCap in a later post, but first I have to admit my excited anticipation of this year’s Social Capital Markets conference encountered some disappointment yesterday as the third annual conference kicked off. The day began with a co-keynote address by Sean Stannard-Stockton, from Tactical Philanthropy and organizer of this year’s first philanthropy/nonprofit focused track at the conference, and Kevin Jones, co-founder of SoCap. Kevin and Sean’s figurative two-step was a nod to the on-going confusion about where/whether philanthropy and the nonprofit sector fit, or how they fit, into a conference who’s heart and founding are heavily in the double bottom-line, impact investing camp.

Sean gave an eloquent speech arguing for the inclusion of the nonprofit/philanthropy sector in this movement to create a social capital market, arguing that “We don’t speak the same language, but we have the same goals,” and “We need to come together to be better able to find what we are both looking for.” But Kevin still referred to Sean and his track as the “nonprofit clan” and Sean as its “emissary.” I’m not sure why there has to be this awkward line between impact investing and philanthropy, but apparently there is still quite a bit of discomfort with the connection between the two worlds. As Stacy Caldwell, Executive Director of Dallas Social Venture Partners, so eloquently Tweeted yesterday:

I’m not sure that we are past the “awkward” stage yet.

To me, it seems so obvious that the nonprofit and government sectors, who hold the majority of money up for grabs in the social impact space, must be full and equal partners in the creation of the social capital marketplace.

But we are still speaking two different languages. And I’m not sure we’re pushing the conversation forward.

The first breakout session I attended yesterday was the Tactical Philanthropy Track’s “Decriminalizing Fundraising” session with two of the rockstars of nonprofit fundraising: George Overholser, from Nonprofit Finance Fund, and Dan Pallotta, author of Uncharitable. But I have to be honest with you, and it pains me to say this about two people I admire quite a bit, I was underwhelmed. The session was just a recap of the spiels George and Dan have given many times before, rather than a cutting-edge discussion and demonstration of how we change the broken funding of the nonprofit sector. If you missed the session, or haven’t read any of Dan or George’s writings, Adin Miller did a great job of summarizing the session on the Tactical Philanthropy blog. But the conversation didn’t go nearly far enough. As Adin said:

In general, the audience seemed to agree with the speakers’ position. There were little to no objections to their key points. The questions from the audience reflected more practical inquiries related to changing perceptions and attitudes toward nonprofits and freeing them up to truly grow the sector. And yet, I feel the conversation has just started and that we need a lot more insights into new strategies and tools to truly decriminalize fundraising.”

There ARE new tools and examples of organizations doing exciting things to finance their social impact in the nonprofit space. I would have loved to hear about those, instead of these old arguments about the need for new tools.  And I would have loved to see a discussion about what infrastructure and structural changes need to happen in the sector to push funding forward and how we make those happen.

In the sessions on impact investing and the general sessions later in the day there is a constant movement to push the conversation forward, to unveil new tools, to detail new approaches, to describe new infrastructure in order to push the impact investing sector forward. There is a very palpable sense that this new market is ours to create, “We are the ones we’ve been waiting for,” as Lisa Hall from the Calvert Foundation said in a later session on impact investing. But yesterday at SoCap I didn’t see that same confidence, that same rigor, that same diligence, that same drive in the nonprofit/philanthropy side of the market to create new funding vehicles, new solutions to the broken funding structures we encounter every day.

Let’s see how today goes…

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About the Author: Nell Edgington is President of Social Velocity (www.socialvelocity.net), a management consulting firm leading nonprofits to greater social impact and financial sustainability. Social Velocity helps nonprofits grow their programs, bring more money in the door, and use resources more effectively. For more information, check out Social Velocity consulting services and clients.

Tuesday, October 5th, 2010 Financing, Fundraising, Nonprofits, Philanthropy, Strategy

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9 Comments to The Awkwardness of it All: SoCap and the Nonprofit World

[…] This post was mentioned on Twitter by Stephanie Strom, matthew bishop and changefeed, Nell Edgington. Nell Edgington said: #SoCap10 still struggles to find a place for the nonprofit side of the market: http://bit.ly/d7m9Ih […]

Caleb Galaraga
October 5, 2010

What was your best take away from the conference then? How often is SoCap held?

Christine Eibs Singer
October 6, 2010

I agree with you completely; E+Co, a US non-profit, has been investing in clean energy enterprises for 16 years with the objective of proving the case to the trad’l financial community that you can invest in small, clean energy businesses in Africa, Asia and Latin America and get not just financial returns, but signifincant energy access AND climate change impacts. 16 years into this, we know the non-profit model inhibits scalable capital aggregation and impact. I agree completely with Lisa Hall “We are the ones we’ve been waiting for” Stay tuned for E+Co’s evolution into for profit, commercial investment platforms for clean energy enterprises in Asia!

Nell Edgington
October 6, 2010

Caleb,

SoCap is held once a year, this is its third year. I had several great takeaways from SoCap. Look for my posts later today and this week summarizing what I got out of the conference.

Nell Edgington
October 6, 2010

Christine,

Good for you, it sounds like you all are doing important, innovative work. It also sounds like the nonprofit model has not been a good fit for you and you are wise to adapt your model to what will deliver the best impact. At the same time I’d like to see the nonprofit model itself adapt to this changing environment. We’ll see.

Christine Eibs Singer
October 6, 2010

Nell, for us, the challenge becomes how much investment capital can E+Co aggregate via it’s non-profit status and how does this “investment” drive affect the raising of grants for the purely philanthropic side of the business? Our thesis of there being ample 3-4% capital out there to drive investment into clean energy small and growing businesses in the developing world has not been proven out.

Nell Edgington
October 6, 2010

I hear you. Capital in the nonprofit sector is broken. I’m hoping efforts like those at SoCap can help drive the nonprofit capital market forward, just as it has helped to drive the impact investing market forward.

SOCAP RECAP | ReachScale
October 19, 2010

[…] The “Actions Speak Louder” Award SOCAP attendance was several hundred more than a thousand, and attendance at the “unconference” on the third day had 600 participants and featured 12-15 UN sessions per time slot. This was twice as many participants as any other conference I attended and almost twice as many as SOCAP had last year. Most important, virtually every person was working on solutions to one or more global (and/or local) problems. To learn more, read Nell Edgington’s report here. […]

[…] SoCap The Social Capital Markets conference — which bills itself as sitting at “the intersection of money and meaning” — is also held in early October, slated for Oct. 1-4 here in San Francisco. SoCap is “dedicated to increasing the flow of capital toward social good,” but has proved slightly unexciting, from all reports, and fronts a mixed bag of panelists so far. If anything, it’s the money that appears to be under-represented. 2011 attendee Nell Edgington has a good account of issues at last year’s conference. […]

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