Texas Social Innovation Initiative Virtual Press Conference

I mentioned in an earlier post that Social Velocity will be one of the consultant teams working on OneStar Foundation’s Texas Social Innovation Initiative (TSI).  The TSI is a partnership between OneStar, Root Cause, and Dallas Social Venture Partners, which gives each of seven innovative Dallas/Fort Worth nonprofit organizations, who competed among 60 nonprofits, more than $25,000 in cash and strategy assistance to support their growth and impact.

The seven nonprofit winners will be announced this Wednesday at the Governor’s Nonprofit Leadership Conference in Dallas.  As part of that announcement there will be a virtual press conference at 10:30 a.m. CST featuring a discussion by leaders in the nonprofit sector about how to stimulate social innovation in Texas. Participants are Elizabeth Darling, president/CEO of OneStar Foundation; Stacy Caldwell, executive director of Dallas Social Venture Partners; and Andrew Wolk, CEO of Root Cause. To participate in the conversation you can watch the stream on the Social Velocity blog below, and you can also follow the conversation on Twitter via the hashtag #TXSI.

UPDATE: The virtual press conference happened on Wednesday, December 9th, but you can still watch the taped virtual press conference here.

Tags: Andrew Wolk, Dallas Social Venture Partners, Elizabeth Darling, OneStar Foundation, root cause, Stacy Caldwell, Texas Social Innovation Initiative

Making a Vision for Change a Reality

One of the many things I love about my job is meeting social entrepreneurs (who often don’t even know that they are social entrepreneurs) who have amazing, game-changing ideas for solving social problems.  Their creativity, vision, passion and commitment are truly inspiring.

But the thing that strikes me about some of them, and the main reason I started Social Velocity, is that they don’t know how to make that idea, that solution, a reality.  We can’t expect that the same people who come up with great ideas or have a grand vision for change also have ALL of the skills required to build momentum around that idea and execute on it.  Often people approach me with a great idea, or a great organization, that has hit a roadblock.  They can’t figure out how to take the idea or organization to the next level, how to make their vision a reality.  Often I find that the roadblock exists because they are missing three key steps.

The first step is assembling an effective group of advisors, evangelists, supporters, workers, whatever you want to call them.  This doesn’t have to be an official board of directors or advisors.  But it does need to be a group of people who get the vision, are deeply committed to it and have resources to offer toward making the vision a reality.  These resources could be expertise in the particular solution, connections to influential people, funding, who knows.  But the idea is that a single actor cannot do it alone.  The same is true for people within organizations who want to take the organization in a new direction, toward a new solution.  Again, they need to find key supporters who can help them make their vision for change a reality.

The second key piece is a plan.  An idea for a new solution or an idea for a change in direction is great, but it is just an idea. It is difficult to build action around an idea.  To bring an idea to fruition you have to create a plan for how you will get from point A (where you are right now) to point B (where the vision is a reality).  What is it going to take to get there (infrastructure, funding, people) and how will you make it happen?  A clear, articulate, compelling plan demonstrates that you have done your homework, you know what you are doing, you have a clear vision, and you are going to get there.

Finally, you need to translate your plan into a pitch that will convince funders to jump on the train.  But how to successfully communicate with potential supporters is a key and often misunderstood skill.  You need to translate what you know to be truth (your vision for change) into something that will compel an outsider to become involved.

These three steps are key to making a vision for change a reality.  And this is what Social Velocity helps social entrepreneurs navigate. I think we are wrong to expect social entrepreneurs to do it all alone (assemble supporters, create a compelling plan, build the infrastructure, find funding).  They aren’t superheros; they are just leading the charge.

Tags: change, social entrepreneurs, Social Velocity

If We Could Be So Bold

Inherent in our current time of constraint (struggling economy, crumbling institutions, unhealthy planet) is the opportunity of possibility.  As Margaret Drabble said, “When nothing is sure, everything is possible.”

But it is only possible if we seize the opportunity.  Nowhere is this more true than in the nonprofit sector.  Let’s admit it, the nonprofit sector tends to be risk averse.  And you could argue that the many constraints that they endure incent them to  be risk averse.  But what if nonprofit organizations seized the opportunity that this restructuring offers and became bold.  I mean really BOLD.

What if nonprofit organizations adopted massive, crazy, BOLD goals? The BHAGs (Big Hairy Audacious Goals) that Jim Collins in Good to Great describes:

A BHAG is a huge and daunting goal — like a big mountain to climb. It is clear, compelling, and people “get it” right away. A BHAG serves as a unifying focal point of effort, galvanizing people and creating team spirit as people strive toward a finish line. Like the 1960s NASA moon mission, a BHAG captures the imagination and grabs people in the gut.

It is a massive, energizing, crazy goal that can bring people together, give them something to work for, make them part of a team that is doing something inventive, game-changing.

To Nathaniel Whittemore of the Change.org blog we are obligated to move the solutions we seek to a loftier realm.  Those working to solve social problems must be bigger, bolder, crazier, more disruptive in their goals:

Where I think it leaves us is with an obligation to push even harder. At the cusp of that last gasp of crazy, the forces that wish to uphold the status quo kick and fight even harder. The former gatekeepers will not leave without a fight. We need to be even more bold, because at the end of the day, I don’t want 20% better nonprofits with a fundraising strategy better optimized for online giving. I want disruptive change that rights wrongs and realigns incentives for a more sustainable, just future.

And Dan Pallotta agrees.  He challenges nonprofits to take a cue from the moon program as well and create massive goals:

Nonprofit organizations have to join forces and begin committing themselves to impossible goals that address the massive social problems we confront, and they must define those goals in time and space — a cure for MS in 10 years; the end of homelessness in Boston in 10 years, and so on. Think of President Kennedy’s challenge: “I believe this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to the earth.” No wiggle room there…

But bold goals are not just for the sake of goals.  Those massive, crazy goals propel an organization forward.  They galvanize staff, board, volunteers, funders to get up from their chairs, to step away from mindless, boring meetings, to enlist their friends, family, colleagues, to invest time and resources until it hurts. Bold goals are the rallying cry that moves us toward solutions, compels us to fix broken systems, to break out of our inertia:

If a courageous group of nonprofits would call for the end of child hunger in D.C. within seven years, we’d have to start talking seriously about…all of the…structural problems like admin:program ratios, inadequate investment in infrastructure…and those discussions would actually be exciting. There would be a reason to reframe the present structure. To try to reframe that structure in the absence of a compelling context…[is] like trying to develop a lunar module in the absence of any goal to get to the moon. You wouldn’t know anything about the booster that would carry it, the rendezvous strategy, weight limits, etc. Everything you did would be ineffective…Daring goals, set in time and space are the only way to get there. Any less courageous path lands us exactly in the chaotic and ineffectual place we stand today. And that’s a long way from the moon.

I’ve seen with my clients how massive goals can transform organizations and galvanize them toward solutions.  When they have decided to take on exponential growth instead of incremental growth.  When they have moved from working to grow their services by 50% each year to working toward addressing 50% of the need.  The former can address the needs of 100 new clients a year, the latter can move towards actually eradicating the problem all together. This change in perspective, in goals, can revolutionize an organization.  No longer are the board, staff and funders content to add a few sites each year with no end goal in sight.  Rather, they understand and rally around their long-term goal, which is to solve a problem.  And they see every effort they make, every meeting they come to, every investment they secure as getting them that much closer to that solution.  It can transform an organization, and ultimately transform a problem.  And isn’t that really what we are all here to do?

Tags: BHAGs, Change.org, Dan Pallotta, Jim Collins, Nathaniel Whittemore, nonprofit

Making Change the New Norm

It occurred to me in two conversations I had this morning that small change can create large change, but how exactly does that happen?

My first conversation was a phone call with George Overholser, from the Nonprofit Finance Fund and a leading thinker around new kinds of capital for nonprofit organizations.  I was getting some background from him on the whole movement to make growth capital (money necessary to build organizations rather than simply buy services) a reality for nonprofit organizations in preparation for my session later this week at the Social Capital Markets conference.

At the Nonprofit Finance Fund they have launched several exciting programs to help nonprofits secure the money necessary to scale great programs, such as the SEGUE program that takes the traditional nonprofit capital campaign approach and turns it on its head raising money not for a building, but rather for the patient capital required to pay the bills while a nonprofit figures out how to grow and make sustainable their business model.

My big question to George, however, was: How do we get these great new ideas, like patient capital (which is normal and accepted in the for profit world) prevalent and accepted in the nonprofit and philanthropic worlds?  The number of nonprofits and donors currently participating in growth capital deals is very small.

George’s response was that these new ideas don’t have to be widely accepted or embraced.  The end game is not to get all of the “mom and pop” nonprofits and donors to embrace these concepts.  Rather, he looks forward to the day when there are ten $20 million growth capital deals out in the marketplace, that that alone will create tremendous change.  He gave the example of Teach for America.  If they can grow their successful program throughout the country, there would be tremendous change in the education landscape as a result .  The end goal is to secure capital for a select few nonprofits that are uniquely poised to grow. He compared it to Apple, which is a company that makes billions of dollars, but has grown to that stage with only a few tens of millions, say $50 million, in growth capital. And Apple has transformed not only its industry, but really, how we all communicate, interact with data and live. That’s a pretty impressive impact for a $50 million investment in growth capital.  He argues that the same is possible in the nonprofit world.  We could have a handful of nonprofit growth capital deals and transform not only the nonprofit sector, but some enormous social problems.

An interesting hypothesis, but I don’t know if I buy it.  Which brings me to my second conversation of the morning, with Sean Stannard-Stockton of the Tactical Philanthropy blog.  Sean has been known for the past three years as a leading-edge thinker about how to make philanthropy more effective at delivering social impact.  He announced this morning that he is launching a new philanthropic advisory fund called Tactical Philanthropy Advisors.  The firm will advise high-net worth philanthropists (accounts of $1 million or more) on “the social impact of their financial investments, and work with their investment advisors to align their financial portfolios with their philanthropic goals.”

They are seeking to elevate philanthropic advising to the respect, time and resources that overall financial advising has enjoyed.  In this new firm, philanthropic advising is no longer an add-on service that a wealth management company offers its clients.  And their fee structure has them paid by a percentage of the overall portfolio an investor holds with them.  So, in essence, they are paid as a traditional financial advisor is paid, based on the performance of the overall portfolio, but in this case the portfolio return is a social, not a financial one.  They are also interesting because they are a for-profit company, with a social purpose and are applying to become a B Corp.  So the firm is and of itself a social business; they are social entrepreneurs charting this new landscape along with the rest of us.

You only need to read a few entries in Sean’s 3-year old Tactical Philanthropy blog to understand how this new firm could revolutionize how the philanthropic sector, and thus the nonprofit sector, operates.  Sean understands and believes in philanthropic equity, mission-related investing, scaling nonprofits, organization-building, and so on.  He understands these new ideas that George and others promote and could be a critical partner in helping philanthropists understand how to use their money more effectively to drive change in a sector that is undercapitalized and dysfunctional.

However, Sean and his firm will probably only work with a small group of the countless philanthropists out there, so again, what change does this signify?  And how do we bring along other philanthropists who cannot or will not be touched by Tactical Philanthropy Advisors?

It all comes down to the single question: How does change happen?

I would argue that it is not enough to have single examples in the largest nonprofits or among the largest philanthropists.  The Nonprofit Finance Fund, Teach for America, Sea Change Capital, Tactical Philanthropy Advisors and all the other cutting-edge thinkers and examples of how we can do things better are great and absolutely necessary.  Without innovation we have nothing.

But let’s not forget stage two, whenever it may come, that involves making these great examples the norm.  The day when all, or most, nonprofits understand and have access to the power of patient capital and capacity capital, when all or most philanthropists understand the power of investments rather than gifts and how to truly support social change. Ten deals are great, but they are just a start.  True change must be systemic, must be ingrained, must become the norm.  It can’t exist just on the East and West coasts.  It can’t just be in the understanding and practice of the largest, most resourced organizations. That’s why I started Social Velocity; I wanted to bring these cutting-edge ideas and practices to places, organizations and philanthropists that weren’t in the top 10, but were still instrumental to creating social change.  To really be transformative, these new ideas have to become common practice. As David Bornstein has put it:

An important social change frequently begins with a single entrepreneurial author: one obsessive individual who sees a problem and envisions a new solution, who takes the initiative to act on that vision, who gathers resources and builds organizations to protect and market that vision, who provides the energy and sustained focus to overcome the inevitable resistance, and who- decade after decade- keeps improving, strengthening, and broadening that vision until what was once a marginal idea has become a new norm.

I applaud people like Sean and George and the countless others who are working to change mindsets, organizations, systems and structures.  Let’s build on the innovation they have started and make those powerful ideas and examples the new norm.

Tags: B Corp, David Bornstein, George Overholser, growth capital, nonprofit, Nonprofit Finance Fund, Philanthropy, Sean Stannard-Stockton, SEGUE program, Social Capital Markets conference, Tactical Philanthropy, Teach for America

Two Weeks to SoCap

Two weeks from today the 2nd annual Social Capital Markets Conference kicks off in San Francisco.  I’m pretty excited about it because I think one of the biggest things standing in the way of social innovation is a social capital market–the financial tools and vehicles necessary to adequately capitalize social innovation.  The speaker’s list for the conference reads like a Who’s Who of the social innovation world.  There are some incredible sessions, too many to choose from.  I wish the conference were longer than 3 days.  I’ll be tweeting (as much as my multi-tasking challenged brain can handle) and blogging from the conference.

Just a few of the topics to be discussed at this year’s conference include:

• The Social Capital Movement Across the Globe
• Social venture funds’ prominent role in the new economy
• The sophistication of social investing pioneers
• Raising money for impact investing in a downturn economy
• The Obama Administration’s focus on social innovation
• Creating effective collaboration between the private sector and development agencies
• Moving beyond Microfinance
• Market based solutions for the base of the pyramid
• New corporate structures, including hybrid businesses and L3C organizations
• Creating metrics and value around social change
• Mobile technology platforms worthy of investment

Are you excited yet?

One of the things I’m particularly excited about at this year’s conference is a movement toward including nonprofits and philanthropy in more of the conference.  Last year’s conference tended to focus a bit more on blended value investing (investing in social impact organizations that provide a social AND a financial return). But we don’t want to neglect those social entrepreneurs that employ a nonprofit model to create their desired social impact.

To that end, SoCap this year has a host of sessions about nonprofit social entrepreneurs  and a social capital market for them.  I am moderating one of these sessions, Growth Capital for Nonprofit Social Entrepreneurs on Wednesday, September 2nd at 1:30pm.  Darell Hammond of KaBoom!, Greg Baldwin of VolunteerMatch and Kelly Ward from America Forward/New Profit will discuss the growth capital that was used to bring some impressive nonprofit organization’s to scale.

If you are going to attend only one conference in the social innovation space this year, I would highly recommend SoCap.  Hope to see you there!

Growth Capital for Nonprofit Social Entrepreneurs

Date: Wednesday, September 2nd
Time: 1:30pm

Moderator: Nell Edgington, Social Velocity
Greg Baldwin, VolunteerMatch
Darell Hammond, KaBOOM!
Kelly Ward, New Profit and America Forward

Nonprofit social entrepreneurs like Volunteer Match and KaBoom! have become, over the past decade, very successful, national, multi-million dollar nonprofit organizations working to solve critical social problems. They’ve achieved this impressive scale through growth capital from individuals, foundations and venture philanthropy funds. Greg Baldwin from Volunteer Match and Darell Hammond from Kaboom will be joined by Kelly Ward from America Forward and New Profit, a pioneer venture philanthropy fund in Boston, to discuss the various financial tools available and necessary to scale nonprofit social entrepreneurs.

Tags: America Forward, KaBoom!, microfinance, New Profit, nonprofit, scale, SoCap, social capital market, social entrepreneurs, Venture Philanthropy, Volunteer Match

The Significance of the Social Innovation Fund

While many were starting their 4th of July vacations last week (me included) President Obama had a remarkable event at the White House.  He invited a very impressive list of nonprofit leaders, philanthropists, social entrepreneurs, and thought leaders to launch his “Community Solutions Agenda.”  Key to this agenda are the White House Office of Social Innovation and the Social Innovation Fund.

Sean Stannard-Stockton of the Tactical Philanthropy blog gives an excellent description of exactly what the Social Innovation Fund will do.  Essentially the Social Innovation Fund is a $50 million federal government fund (assuming Congress actually appropriates the money) that will be granted, via the Corporation for National Service, to “grantmaking institutions” to then regrant (and match the regrant 1 to 1) to nonprofit organizations.

The nonprofits that receive the regranted funds are required to:

• Match the grants 1 to 1  through state, local, or private sources (thus resulting in an overall 2 to 1 match of federal dollars)
• Grow proven programs, or support new programs, in low-income communities
• Demonstrate that they can sustain the program at the end of the grant period
• Use performance metrics to evaluate and improve the program
• Contribute the resulting knowledge to their field

In addition, the grantmakers that receive the Social Innovation funds must provide technical assistance to their grantees.  And the Corporation will 1)provide technical assistance to both the grantmakers and the nonprofits receiving the regranted funds and 2) create a clearinghouse for best practices from the funded projects.

There has been much debate (here and  here for a start) about whether the Social Innovation Fund will have a positive, negative, or any effect on the nonprofit sector and its ability to find and grow solutions.  The most pessimistic of these is Jeff Trexler, professor of Social Entrepreneurship at Pace University, who writes:

At its core, the [Social Innovation Fund] follows a model that’s all too familiar from comparative administrative law–a government program that gives money to subgrantees who in turn give money to other subgrantees, managed through the relentless documentation of how stated program goals were met.  For example, Russia moved to precisely this model recently, channeling social funds through grantmaking intermediaries, and USAID has been doing it for years.

True, the mechanisms of the Fund are probably not that innovative.  And the relatively small size of it ($50 million compared to the hundreds of billions of dollars of federal funding that annually goes into the nonprofit sector) is not very impressive.  But what is interesting and exciting is that the largest nonprofit funder (the federal government) is turning a page.

As Bob Ottenhoff points out on the Guidestar blog, the federal government is by far the largest funder to the nonprofit sector, providing over 29% of its funding, compared to the 12% that comes from charitable giving, which we spend most of our time talking about.  If the federal government could take an interest in innovation in the nonprofit sector (when was the last time that that many nonprofits and philanthropists were assembled together at the White House?), try and succeed at some new funding vehicles, take a lead role (or, really, any role) in the creation of a social capital market to seed and scale social innovation, THAT would be tremendous.

The Social Innovation Fund, in and of itself, is maybe not that impressive. But what is impressive is that the federal government has recognized social innovation as a force for change, is willing to take a risk (albeit small) in this new realm and may be willing to use this test case as R&D for a future, much larger, more innovative stab at getting itself pointing in a new, more helpful direction.  If we are truly going to scale social solutions then the largest funder of those solutions has to be on board. So let’s see what happens when the federal government dips its toe into the waters of social innovation.

Tags: Corporation for National Service, federal government, Jeff Trexler, nonprofit, President Obama, Sean Stannard-Stockton, social entrepreneurs, Social Innovation Fund, White House Office of Social Innovation

Determining Best Use of Resources for Sustainable Social Impact

There is a very useful and widely used matrix in the business world called the “BCG Matrix” that helps a company analyze their product lines to determine which to further invest in, which to liquidate, which to expand, etc.  This is where the term “cash cow,” a product whose positive cash flows pay for the other products of a company, comes from.  Each product line is placed in the matrix, which measures the relative position of the product line in the market (low to high market share) against the rate of growth of the business (low to high).  Depending on where the product line falls along those two matrices, you can determine what strategy to take with the product (invest further, liquidate, etc.).

Back in the early 1980s Robert Gruber and Mary Mohr (“Strategic Management for Multiprogram Nonprofit Organizations”) adapted this matrix for nonprofits to enable them to plot their programs according to social and financial returns.  This allowed a nonprofit organization to take a hard look at their programs to determine a strategy for each.

I would argue that the tool could be used by social entrepreneurs (both for profit and nonprofit) to analyze their programs/activities/products/services to see which are worth investing and growing, which are worth sustaining, which should be divested from, etc.  The matrix looks like this:

A social entrepreneur could plot their activities in the matrix according to each activity’s social impact (low to high) and financial return (low to high).  So, let’s take a fictitious K-12 education nonprofit that has four main activities:

1. An after-school program during the school year for low-income kids
2. A summer camp for a broad cross section of kids on a sliding scale fee
3. A book store for the general public
4. A backpack program where donations from local stores are gathered, assembled and given to children in the program.

The after-school program for at-risk kids has a high social impact (their results are great) but it is very expensive to the organization.  This would be a “Worthwhile” program in the matrix.  The summer school is “Beneficial” because they make some money off of it, and it has social impact.  The book store would be a “Sustaining” program because it provides them a high financial return, but little social impact.  Finally, the backpack program, which provides each child a couple of notebooks and some pens and pencils, has little social impact and no financial return, is a “Detrimental” program.

Once each program is plotted on the matrix, the organization can make some difficult decisions.  The strategy, according to the matrix, would be to “carefully nurture” the after-school program, “cautiously expand” the summer school program, “sustain” the book store, and “cut” the backpack program.

However, there are always shades of gray, and any good tool needs to allow for that. Perhaps the summer school program provides some social impact, but not enough because it is a 50-50 mix of at-risk and low-risk kids.  So an expansion of that model might detract from the overall social impact of the organization.  The organization might want to grow the social impact side of the program (enroll more at-risk kids) while growing the book store revenues or increasing the price for low-risk kids to subsidize that growth.  The point is that by analyzing each program/activity/product/service of a social enterprise the organization can make strategic decisions about growth, maintenance, pruning and ultimately where best to funnel limited resources in order to create sustainable social impact.

Tags: BCG Matrix, Mary Mohr, Nonprofits, Robert Gruber, social entrepreneurs

The Social Capital Markets Conference

In the emerging field of social innovation there are a plethora of conferences here and abroad.  Some are better than others.  One that I am particularly looking forward to is September’s Social Capital Markets conference in San Francisco.  This is only the second year of the conference, which brings together social investors, foundations, social entrepreneurs, social venture funds and others interested in expanding the capital available to social entrepreneurs.

In the inaugural conference last year, 600 people from 26 countries attended.  In fact, there was a last minute rush of conference registrations shortly after the financial market collapse, painting an interesting picture of traditional finance migrating to social finance.

The purpose of the conference is to create “a new kind of capital market, a new way of doing business that takes into account people, planet and profit.”  In essence they are attempting to build momentum and action around creating a capital marketplace for social good–financial vehicles for social entrepreneurs both profit and nonprofit.

Whereas last year’s conference focused mainly on for profit social entrepreneurs, this year’s conference is adding some sessions on what conference founder Kevin Jones calls “our nonprofit cousins.”  For example, the opening keynote address will be about how the Obama Administration and its Office of Social Innovation is working to scale high-functioning non-profit organizations to create change. And I’m even getting into the game by moderating a panel about some of the capital tools nonprofit social entrepreneurs have used to go to scale.

I think SoCap provides an excellent venue for bringing all of those working towards expanding the capital available to social entrepreneurs together.  My hope is that this conference goes beyond great examples and great networking and actually helps make more money available to social entrepreneurs, whether they are creating profit or not.

If you are interested in the social capital market space, you don’t want to miss this conference.

Tags: Kevin Jones, Obama Administration, Office of Social Innovation, SoCap, Social Capital Markets conference, social entrepreneurs, Social Finance

Innovation is the Answer

There’s a really great recent post on the Stanford Social Innovation Review blog by Mario Marino, founder of Venture Philanthropy Partners, a venture philanthropy fund in Washington, DC. Mario’s post is the best attempt I’ve seen yet to frame the current state of America (deepening recession, crumbling institutions, etc.) as a tremendous opportunity to reinvent ourselves.  And although Mario set out to write a post about the new White House Office of Social Innovation, he realized that what is happening in America is a much larger need for innovation:

Instead of focusing on social innovation, I feel compelled to lift up a level and talk about innovation more broadly. I am convinced that, amid the many challenges facing our President, nothing is more important for the long-term strength of our nation than driving greater levels of innovation across all sectors of our economy, including the nonprofit sector.

Indeed, Mario points out that although we are a country of innovators, we have lost our urgency to innovate.  The current crisis we are in will force us as a country to find innovative solutions to all that ails us:

Through radical innovation in our commercial, nonprofit, and public sectors, we must break the status quo that is too often miring us in mediocrity—from how we manufacture our products to how we educate our children, from how we consume energy to how we provide health care. We have no choice but to discover and deliver new, different, and better ways of dealing with our most vexing challenges.

He suggests that three trends will enable us to seize the moment and innovate our way out of this mess:

1. Influx of Talent: The increased entrepreneurial spirit and drive of 20-40 somethings, the energy of the Baby Boom generation, and immigrant talent and expertise will create a large group of people with energy, interest and initiative to develop new solutions
2. New Mindset: The new generation of entrepreneurs is more interested in innovation for social good than innovation for individual gain (I wrote about this trend as well).
3. New Networking Technologies: Web 2.0 and social media have made coordinating and scaling innovation much easier and faster.

These three trends create a huge opportunity for America to take our crushing problems and innovate our way to solutions:

If necessity is the mother of invention, then this crisis, which has laid bare the depth of our needs, provides us the dramatic necessity to drive innovation and spur entrepreneurs of all types and sizes to find ways to deal with our challenges. The real change makers will be those throughout the land in small and big enterprises, the new and the old, the scientific innovator to the obsessively compelled entrepreneur, across all sectors, who take up this challenge.

And Mario tasks the Obama administration with leading this movement towards innovation :

So while I could not be more supportive of the Office of Social Innovation, I believe this is a chance for the President to systematically foster a mindset in America that is nothing short of a cultural and economic ground-shift. He must broaden the focus across and among the private, public, and nonprofit sectors—to seek and spark the most promising innovations whether they come from commercial or social entrepreneurs, executives or line workers, community leaders, public servants, researchers, or citizens who don’t fit into any of these categories. The real opportunity before the President is to supercharge innovators from all walks of life and make commercial and social innovation our national imperative.

However, I don’t think it is all up to the Obama administration.  Rather, this national need for innovation is up to all three sectors, not just the public sector, to lead.  Venture capitalists and angel investors can seek out and seed great solutions (for profit or not), nonprofits that have found solutions can create growth plans,  corporations can take a larger view of how they measure success to include social profit instead of just financial profit, foundations can harness their corpus towards innovation through mission-related investing, and the list goes on.   A White House Office of Social Innovation is a start and Obama encouraging a new spirit of innovation would be great.  But to truly become an innovative nation again we’ve all got to take the lead and explore how we can use our respective resources in new ways to encourage solutions.

Tags: innovation, Mario Marino, Obama, venture capital, Venture Philanthropy Parnters, White House Office of Social Innovation