Fundraising is, for the most part, a fundamentally misunderstood activity. There are a lot of misconceptions, among nonprofit leaders, board members — even donors — about effective ways to bring money in the door.
Here are are a few of the worst delusions about fundraising that persist in the sector:
- Events Are Fundraisers
Very few nonprofit events generate a net income after you factor in the direct (food, venue, invitations, entertainment) and indirect (board and staff time) costs that go into them. They simply are not profit-generating activities. If you are looking to your events to bring in a profit, calculate the cost to raise a dollar to see if they actually are. Some nonprofit leaders argue that events generate value beyond profit, vague terms like “awareness” or “goodwill.” That may be, but unless you follow-up with individual event attendees to turn that increased “awareness” or “goodwill” into money, there is little financial value to events. Turn your energies instead to low-cost, mission-focused cultivation and stewardship events for your major donors and major donor prospects, then you might have something.
- Crowdfunding Creates Revenue
Nope, it doesn’t. Revenue is the on-going money you need to keep your doors open and your operations running. A crowdfunding campaign, by definition, is a one-time deal. It is organized around a specific need or timeframe. Therefore the money it generates is not easily or regularly repeated. Crowdfunding could make sense for a nonprofit hoping to raise startup, growth or capacity capital (all one-time infusions of money). But that Kickstarter campaign is not going to keep the lights on, so look elsewhere (like a financing plan) for sustainable revenue.
- Major Donors Can Be Recruited En Masse
Major donors are secured through a long-term, systematic, one-on-one process. There is no quick way to bring large donors on board. My issue with mass major donor fundraising programs (like the Benevon model) is that when you ask people as a group to pull out their checkbooks, you are leaving money on the table. The check someone feels compelled to write after watching a 20-minute presentation with their friends pales in comparison to the one they will write after you’ve built a one-on-one relationship with them over time. Put together a strategic major donor campaign, along with the infrastructure and systems to execute on it, and you will create a long-term major donor base (and its corresponding revenue stream) for years to come.
- Skimping on Fundraising Staff and Systems Saves Money
While you may save a few thousand dollars in salary by hiring a novice fundraiser (instead of an experienced one), you will cost the organization hundreds of thousands of dollars in missed revenue. The same is true with cheap fundraising systems like an ineffective donor database, an unresponsive website, a cumbersome email marketing system, or a poor (or non-existent) marketing strategy. Figure out what it will really cost to build the fundraising team and systems you need and then raise the capacity capital to get there.
- Endowments Solve Money Woes
Let’s face it, an endowment makes sense for very few nonprofits. Even if you were able to convince donors to let their money just sit in a bank account (which is a big “if”), that money won’t really impact your bottomline. Even if you raise an endowment of $1 million, it will only generate $50,000 (assuming a 5% return) of operating revenue each year. Instead raise a much smaller amount of capacity capital which you could use to strengthen your fundraising infrastructure (more staff, better technology). Those improvements could increase your annual revenue by many times more than $50,000.
It’s time to face the facts. There are smart ways to raise money and there are delusional ways to (not) do it. Embrace the power of money and use it as a tool to create a more effective, sustainable organization.
Photo Credit: TaxCredits
I love this time of year. Not just because of the approaching space for relaxation, friends and family, and great food, but more importantly because it is a time for reflection. The end of the year offers a natural analytic marker between what was and what is yet to come.
And as is my end of the year tradition on the blog, it’s a time to look ahead to what the coming year might bring for the nonprofit sector. I’ve always said when I create my Trends to Watch lists that I am less clairvoyant and more optimist. I am always hopeful that the nonprofit sector is growing more effective, more sustainable, more able to create lasting social change. That’s the trajectory that (I freely admit) I am predisposed to see.
So here are 5 things I’m really hopeful about the nonprofit sector as we head into the new year.
- Growth of the Sharing Economy
The emerging “sharing economy,” where a good or service is shared by many instead of consumed by one and managed largely through the use of social technologies (think AirBNB, Netflix, TaskRabbit and countless others), will have wide implications for the social change sector. The sector that employed “sharing” long before it was cool will need to understand this changing environment and the implications for their work. Nonprofits should figure out how to navigate this growing interest (and increasing for-profit competition) in the realms of community and goodwill. It will be fascinating to watch.
- More Focus on Crowdfunding
One element borne out of the sharing economy is crowdfunding, and there is no doubt that it is everywhere. I have written before about my skepticism. But my hope is that crowdfunding will move away from ALS Ice Bucket Challenge-like hype and become another financing tool that nonprofits can use strategically. We need to get smarter about what crowdfuding is, and what it isn’t. A Kickstarter campaign makes sense for startup and other capital needs, but not for ongoing revenue. And while Giving Days are exciting, I’d like to see more analysis of what’s new money and what is cannibalized money. There is no doubt that crowdfunding is a force to be reckoned with, I just hope we turn it into a useful, strategic tool that contributes to — not detracts from — sustainable social change financing.
- Decreasing Power of the Overhead Myth
The Overhead Myth, the destructive idea that nonprofits should spend as little as possible on “overhead” expenses (like infrastructure, fundraising, and administrative costs) was laid bare in 2013 when GuideStar, CharityNavigator and BBB Wise Giving Alliance wrote their famous Letter to the Donors of America. This year they wrote a follow up Letter to the Nonprofits of America, arguing that both nonprofit leaders and donors must stop judging nonprofits by their overhead rate and instead focus on a nonprofit’s outcomes. It’s exciting to see this most detrimental of nonprofit myths beginning to crumble, but there is still much work to be done. Not least of which is helping nonprofits articulate and measure their outcomes so that they have a more effective measure with which to replace the overhead rate.
- Growing Emphasis on High Performance
Which brings me to the growing movement for creating more high performing nonprofits. Over the past several years there has been an emerging effort to move nonprofits toward this outcomes approach to their work. The idea is that if nonprofits can better articulate and measure the social change they seek, more resources, sustainability and ultimately more change will follow. In the coming year, a group of social sector leaders (of which I am a member) will release a framework for what practices constitute a high performing nonprofit. But that is just one example of a growing emphasis in the social change sector on results.
- Greater Investment in Nonprofit Leadership
Nonprofit leaders have long traveled a lonely road with inadequate support and resources. Funders and board members often assume that a leader should go it alone, even while for-profit leaders benefit from on-going coaching, training and development. But that is starting to change. A few savvy foundations have invested in nonprofit leadership, and they are beginning to trumpet the benefits of such investments. As more funders understand why investing in the leaders of the nonprofits they fund makes sense, I am hopeful that nonprofit leadership support will become less of an anomaly. And with stronger, more effective and supported leaders comes — I firmly believe — more social change.
Photo Credit: slorenlaboy
I have to be honest. I am so sick of hearing about the ice bucket challenge that I am loathe to write about it. But I wonder if many in the nonprofit and philanthropic sector are falling victim, yet again, to shiny object syndrome, so I feel compelled to say something.
To me the ice bucket challenge is yet another example of what happens so often in the world of fundraising. Nonprofit board members and staff hate fundraising, so they desperately search for a magic bullet to make it all go away.
Sometimes that magic bullet is “an endowment,” sometimes its “earned income,” more recently it has been “crowdfunding.” This month it’s a form of crowdfunding taken to the extreme, the ice bucket challenge. Some have been so swept up in the hype that they have gone as far to say that the challenge is “rewriting the charity model.”
The reality is that if you want to create social change you need to develop a sustainable financial model that aligns with your long-term goals. It’s not sexy, it’s not easy, and I’m probably one of the few people on this planet who thinks it’s fun. But there it is.
While many nonprofits are scrambling to figure out how to create their own ice bucket challenge, and some thought leaders are offering tips along the way, maybe we should all just take a step back.
Let’s be very clear. ALS’s close to $100 million windfall is not a revenue stream. It is a one-time infusion of money. Yes, ALS may try to replicate the ice bucket challenge on a regular basis, but the stars will never align in quite the same way, people will move on to the next shiny object, and the money will eventually fade.
Because this pile of money is not a revenue stream, ALS can’t and shouldn’t add long-term staffing or programming because the money won’t be there next year. At the same time, they probably can’t create an endowment because the donors’ intent was not for the money to sit in a bank account. Regranting the money is also tricky, again because donor intent was for it to go specifically to ALS. In all of this ALS will be under the microscope, because as Ken Berger of CharityNavigator cautioned, a year from now everyone will be asking where the money went.
One of the few paths that I see for ALS is to treat the money like capacity capital. This could be an opportunity to invest some of the windfall in building a stronger organization by investing in technology, infrastructure, and systems. And they could do the same for their affiliates. They could require capacity building plans and budgets and invest in those plans accordingly. They could, in essence, create a $100 million capacity capital investment fund for the ALS system.
But the point is that far from being a great thing that all nonprofits should strive to emulate, the ice bucket challenge creates a complex and potentially damaging problem.
So instead of spending board and staff time trying to dream up the next ice bucket challenge, please, please, please spend that time and those resources building your financial model, by creating a long-term financial strategy, raising capacity capital to build your revenue-generating function, developing a compelling strategic plan in which people will want to invest, and growing and educating your board.
These are the ingredients for a robust, sustainable financial model. Not a bucket of water, a video camera, and a social media stream.
Photo Credit: StoiKNA
Note: Fifth and last in my list of guest bloggers this summer is Laura Tomasko. Laura is a network developer at the Council on Foundations, where she follows trends related to private capital for social good. Here is her guest post:
Perhaps like some of you, I dedicate a good portion of my internet reading to blogs like Social Velocity, Re: Philanthropy, and Philanthropy 2173. When I am browsing a blog unrelated to nonprofits, philanthropy, and impact investing, I do a double take when I come across a topic from my professional sphere.
One of those non-work related blogs that I read is Popville, which chronicles activities in Washington, DC neighborhoods. This July and last, two local businesses sought financing through crowdfunding platforms, and reached out to Popville readers for support. Both cited the community focus of their enterprises as reasons to financially support their efforts. What ensued in the comment thread of both posts provides a snapshot into how those outside of the philanthropy and impact investing field understand and discuss crowdfunding, charitable giving, and investing with the intention to generate social and financial returns.
Last year, a local business named Pulp posted to Popville to request “donations” to improve the store and website, including repairs to fixtures, new paint, windows, and other related costs. Even though they said they wanted donations, Pulp actually sought no-interest loans, a distinction clear on their Clovest crowdfunding page but not on Popville. Confusion and opinions swarmed the comments section as people tried to figure out whether Pulp wanted a donation or a loan, and shared their musings on the whole situation.
This July, another local business, Three Little Pigs (TLP), used Popville to promote their Kickstarter campaign, accurately requesting donations for infrastructure improvements to enhance the business that will allow them to build a community space on their third floor. In exchange for donations, TLP offers gifts, like a pound of maple-cured bacon, to donors.
The comments to both posts provide insight into how local residents react to financial requests from community-focused small businesses. Such requests may increase given the passage of the JOBS Act and the Securities and Exchange Commission proposed rules that allow non-accredited investors to get an equity stake in a local business through crowdfunding platforms.
Here are common themes about local businesses raising money on crowdfunding platforms raised by commenters:
- Is This Charity?
While both businesses used words associated with philanthropy to appeal to the charitable sense of local residents, neither provides a charitable tax benefit to the readers. This created confusion and commenters wrote in to ask whether the business would provide a tax benefit or repay the money. One Pulp commenter asked, “Does anyone know what the tax implications are to this approach? I doubt they realize the tax-exemption you typically see with donations to non-profits. Or do they? Could this be an interest free loan as well as a tax-free donation?”Questions such as this one suggest that those using crowdfunding platforms to raise money need to clearly state what they ask of their potential supporters and what they will get in return. For example, they should distinguish between how the funding will benefit the community and whether it is a charitable donation, a donation without a tax benefit, or loan.
- Should You Donate to a For-Profit?
Many commenters bemoan the idea of a for-profit business asking for donations instead of raising the necessary capital through the sale of goods and services. There seems to be an expectation that the business should either flourish or fail based on the value of the good or service, and donations should not supplement either course. While some were happy with the idea of donating to a for-profit, most did not support the concept.
- What About Traditional Financing?
Several wondered why the businesses did not get loans through banks or pay for these expenses using a credit card. Others supported crowdfunding as a way to get around the hurdles of traditional financing. While one TLP commenter in support of traditional financing noted, “There are plenty small business loans and lines of credit they can apply for at the mentioned banks,” one in favor of crowdfunding stated, “If you can’t meet every requirement, the major banks will usually turn you down due to high risk.”
The confusion and concern that arose from these two crowdfunding experiences suggest that language matters and concepts like crowdfunding and impact investing are still new to people accustomed to distinguishing charity, which generates social benefit, from business and investing, which seek to generate financial revenue.
In addition to local businesses on crowdfunding platforms, mainstream media use language associated with charity to describe impact investing activities. An interesting example is coverage of the bridge loan that Laura and John Arnold made to the National Head Start Association during the 2013 government shutdown. Covering the story, the New York Times uses the headline, “$10 Million Gift to Help Head Start Through Shutdown” and Politico writes, “Philanthropists pledge $10 million to restore 7,000 Head Start seats.”
Tucked within both articles, after terms like “donation” and “gift,” are brief mentions that the money might be paid back as a no-interest loan if government restores funding after the shutdown. However, to those scanning headlines and not reading the entire article, it is not clear that the Arnolds have made an impact investment in the form of a bridge loan to the Association.
With increased interest in social entrepreneurship and impact investing, many use charitable language to describe financial transactions ranging from donations to impact investments. Until the concept of impact investing becomes as mainstream as charitable giving, taking the time to distinguish between the two could increase awareness, and eventually adoption, of both traditional and untraditional forms of financing for social good.
Language matters and those raising capital from local residents, as well as those in the media writing about these transactions, should differentiate between the desired financial transaction and its charitably-minded purpose. Crowdfunding may bring impact investing to new audiences, and let’s make sure that the message gets there clearly and accurately.
Photo Credit: zeh fernando
Crowdfunding is quickly becoming the new shiny object in the world of social change. From Giving Days, to new giving platforms, to lots of articles and studies (here and here to start), it seems that crowdfunding is everywhere lately.
I’m all for innovations in the funding of social change, but I’m not convinced that crowdfunding is really creating anything fundamentally new.
Under “crowdfunding” I include efforts like Kickstarter where a creative effort (a film, art exhibit, library) can garner small investments from a large number of people. And I’m also including Giving Days, at the city and national level, where nonprofits try to raise as much money as possible in a 24-hour online “event”. What these efforts all have in common is they raise money, from a large group of people, over a short period of time.
I earned my fundraising chops working public television pledge drives, one of the earliest “crowdfunding” efforts. The technology was different (TV screens and telephones, instead of CRM systems and social media), but I’m not sure much else is.
So I would like to see us separate what is potentially exciting about crowdfunding from what is just hype. To help in that effort, I offer some questions:
How much is truly new money?
It’s unclear to me how much new money crowdfunding brings to social change organizations. For example, nonprofits participating in Giving Days encourage their annual donors to give on that specific day so that Giving Day dollars are higher. But that’s not new money. True innovation in social change funding comes from efforts to grow the 2% pie – giving as a share of America’s Gross Domestic Product has stayed at 2% for the last 40+ years. I’m not convinced that crowdfunding uncovers money that would not have otherwise ended up somewhere in the nonprofit sector.
How many new donors are being retained?
The point of crowdfunding is that it’s a one time deal. There is a message of urgency that encourages donors to give NOW. So the numbers on a specific Giving Day or with a crowdfunding campaign may be good, but is the funding sustainable? Are nonprofits or social change organizations actually growing their donor base? Are they able to go back to these investors later and encourage them to give again? And if the funding isn’t sustainable, is it really worth the effort it took to get it?
Is crowdfunding reinforcing the “Overhead Myth”?
The destructive idea that donors shouldn’t support nonprofit “overhead“, or administrative costs, is slowly dying, but crowdfunding might just be bringing it back to life. Nonprofit crowdfunding darling charity:water has been taken to task for reinforcing the idea that 100% of the dollars they raise go “directly to the field”. And crowdfunding projects are often specific and “sexy,” which means that the money is not being raised for boring things like the staffing, technology, and infrastructure that most organizations desperately need. Are we perpetuating the overhead myth by encouraging donors to give to specific projects, instead of to overall issues, organizations or teams?
What’s the return on investment?
A lot of time and effort can go into crowdfunding campaigns. If the benefits are shortlived, donors aren’t retained, and the majority of the funding is not new dollars, while the costs (staff and board time, technology investments) are high, then what is the true return on investment? I’m not arguing that it can’t be positive, but I would like to see more critical analysis about it, both at the aggregate and the individual organization levels.
I hate to be a Debbie Downer, but I’d like us to dig a bit deeper to understand what the real effects of crowdfunding are so far and what it’s true promise is. If there is already research out there that can answer some of these questions, please let me know in the comments below.
Photo Credit: SeedingFactory.com
Among other obvious things, December is a time for reflection on the past year and predictions for the coming year. There have already been some great forecasts about what 2014 will bring the social change sector (here, here, and here). And as is my tradition, I want to add my thoughts about the trends to watch in the coming year. (If you want to see how I did in past years, you can read my nonprofit trends posts for 2011, 2012 and 2013.)
Here’s what I think we should watch for in 2014:
- Growing Wealth Disparity
Evidence increasingly reveals that despite our best efforts the gap between the rich and the poor is widening, not shrinking. This growing disparity means that the work nonprofits do to address the ramifications of these inequities is in growing demand. The problems are simply too big and getting bigger every minute. At the same time government resources are shrinking so the greater burden for solutions is increasingly placed on the shoulders of the nonprofit sector. As problems get worse and money gets tighter the social change sector will take center stage.
- Greater Nonprofit Sector Confidence
As the nonprofit sector is asked to do more and more, nonprofits will no longer be a “nice to have” but an absolute essential component of any way forward. We will move squarely away from the idea of “charity” and toward an economy and a mindset that fully integrates the social. No longer sidelined as a small piece of the pie, the nonprofit sector will be recognized for the undeniable and pivotal role it plays in our economy, our institutions, our systems. As such, the nonprofit sector will stop apologizing for the resources it needs to do the job. The sector will rise up and take its rightful place as a critical force in shaping a sustainable future.
- Increased Movement Toward High Performance
As resources become tighter and we look to the nonprofit sector to solve mounting problems, public and private funders will increasingly want to see the return on their investments. And that can only be done by understanding what results a nonprofit is achieving. The growing push this year away from financial metrics and toward outcome metrics will continue to grow. Nonprofits will have to learn not only how to articulate the outcomes they are working toward, but more importantly, how to manage their operations towards those outcomes.
- More Capacity Investments
And if we are going to get smarter about achieving results in the social change space, more donors will start to recognize that they have to build the capacity of that space. There is no end to the list of capacity-building needs of the sector. From investing in more sustainable financial engines, to funding evaluation and performance management systems, to financing nonprofit leader coaching, philanthropists will increasingly recognize that if we are going to expect more from the nonprofit sector we must make sure they have the tools to do the job. A handful of savvy foundations and individual donors have already made capacity investments, and as those investments pay off, more donors will follow suit.
- Accelerated Effort to Enlarge the 2% Pie
For the past four decades private contributions to the nonprofit sector have not risen above 2% of the U.S. gross domestic product. In recent years there have been attempts to grow that pie. And the big question whenever a new funding vehicle enters the space (like crowdfunding most recently) is whether it will be the magic bullet to shatter that glass ceiling. But we are not there yet. As social challenges continue to grow, the wealth gap continues to widen, and a new generation of donors comes of age, there will be increasing pressure to channel more money (not just the same money through a new vehicle) toward social change.
Photo Credit: John William Waterhouse
There was a lot of talk in November about how we actually make the shift toward measuring outcomes in the nonprofit world. And the resounding theory was that we should start with funders and funding for evaluation. Let’s hope philanthropists are listening!
And speaking of funding, there were some fascinating articles about the financing of public parks and how philanthropic, corporate and public money all affect a very public good.
At the end of the day it’s always about money isn’t it?
Below are my picks of the 10 best reads in the world of social innovation in November. But as usual, please add what I missed in the comments.
- A fascinating article in The New Yorker unpacks some recent developments with the funding of New York City parks, the delicate balance between private philanthropy and public goods, and how both contribute to or detract from equality. Exploring a similarly murky delineation between public goods and corporate profit, this article from The Atlantic Cities describes a new trend in corporately-financed public parks.
- Writing in the Stanford Social Innovation Review, Christina Triantaphyllis and Matthew Forti argue that NGOs need to move from overhead measures to cost-per-impact measures. And funders need to help that shift happen.
- Phil Buchanan from the Center for Effective Philanthropy would agree, it seems. As he puts it, “Until foundations really step up and support nonprofits’ data collection, assessment, and improvement, we will not get the best out of our collective efforts.” Tell ’em, Phil!
- But maybe the solution is more systematic. Ever the visionary, David Henderson offers an idea to make the shift toward impact by tying charitable deductions to outcomes. Crazy or brilliant?
- The nonprofit sector really needs to get over its inferiority complex, and to help, the University of San Francisco’s MPA program developed this great infographic on The Rise of the Nonprofit Sector.
- From the HubSpot blog comes some tips for how nonprofits can use social media to really engage people, and The Guardian in the UK offers the 5 characteristics of the top 30 nonprofit CEOs on social media.
- On the How Matters blog Jennifer Lentfer argues that the “social good industry” wrongly assumes “that in the developing world, nothing exists, i.e. that there’s a blank slate upon which our interventions can be built.”
- There are some great reports and data analysis tools recently released. For a start, you can dig into the foundation landscape, analyze nonprofit financial performance, or understand how content marketing and technology are being used for social good.
- Speaking of technology for social good, crowdfunding is becoming a bigger funding source for social causes, raising $2.7 billion in 2012. Lucy Bernholz rounds up the research on this emerging and not fully understood funding vehicle.
- And finally, a really cool example of truly public art has emerged in Milwaukee, Wisconsin.
Photo Credit: kakao-bean
In this month’s Social Velocity blog interview, I’m talking with Brian Sasscer, Senior Vice President of Strategic Operations at The Case Foundation. Brian is responsible for the Case Foundation’s web presence strategy and overseeing the Foundation’s operations. His passion for his job is fueled by a desire to continually push new technologies and for-profit thinking into the nonprofit sector.
I wanted to talk to Brian because of the very exciting new Giving Graph project they announced last March at SXSW. The Giving Graph would help the social sector use data and technology to connect people to causes they are passionate about in a seamless way.
You can read past interviews in the Social Innovation Interview Series here.
Nell: When you presented about the Giving Graph at SXSW last March it was just an idea. Where does it stand now? Is the Case Foundation moving forward to execute on the concept?
Brian: The Case Foundation has been thrilled by the positive response we’ve received since introducing the concept of the Giving Graph in March. We’ve had multiple conversations with folks from the tech and social good community that have surfaced some exciting opportunities to help advance the project. For example, we were approached by Rayid Ghani, who served as Chief Data Scientist from the 2012 Obama for America campaign. He is spearheading The Erich & Wendy Schmidt Data Science for Social Good Summer Fellowship program at the University of Chicago. This new program is bringing together 36 aspiring students in the fields of computer science, programming and statistics to seek out opportunities to use data science as a tool to solve complex social issues. The Giving Graph was selected as one of the projects collaborators and these students will experiment with over the summer.
Through conversations with other nonprofits, for-profits, foundations and technology companies, we’ve made great connections and relationships that have helped us understand the possibilities the graph could provide for a stronger infrastructure within the social good sector. Specifically, we have opened dialogue with the Gates Foundation, as well as Guidestar CEO Jacob Harold. Michael Lewkowitz of Igniter is another individual who has done an exceptional job of exploring the concept of an impact graph, and understanding the landscape of this data play in the social good sector.
We also reached out to other organizations such as Network for Good and Global Giving in an effort to survey the space and understand the big data players in social good data. There are a number of talented individuals who share our vision of helping to further develop a concept that supports and encourages growth in the social sector. As for the Graph itself, we will continue our discussions and experimentation with the University of Chicago fellows assigned to the project with a goal to produce key findings from the experiment sometime in the fall.
Nell: You have sought a good deal of public input on the concept of the Giving Graph. How has that input altered the initial concept?
Brian: We have received excellent feedback from the public related to the SXSW presentation and our blog post. The majority of the input we have received is from thought leaders, nonprofits and foundations, for-profits, and other individuals already working in the data space as it relates to the social sector. Their feedback has validated the need for a tool like this for the sector. The first part of the Giving Graph concept itself was focused on identifying the key players in the data space for social good, understanding the space, and analyzing data location in the social good sector. Through research and discussions with other organizations, we have concluded that our end vision and goal is aligned with the goals of numerous other projects.
We found one project that is working to reform the sector from an information infrastructure point of view, another is helping to facilitate data-sharing amongst organizations, and another is working to match social good opportunities to an individuals interests. Each project can support and build off the others, propagating the number of resources available for the social good sector. From our findings, we have validated our concept and identified different projects out there that satisfy different components of our vision. The hope is to bring these different initiatives together and see this concept come life.
Nell: Do you think something like the Giving Graph could cause an appreciable increase in the amount of philanthropic dollars available in the sector, or would it simply alter where philanthropic dollars get spent?
Brian: We think the Giving Graph concept has the potential to drive both outcomes – both shifting of philanthropic dollars, as well as increasing the overall dollars being given to philanthropic causes. We believe the Giving Graph could help identify new spaces for social good and new campaigns and programs to live in those spaces – leading to potential shifting of philanthropic dollars, as well as bringing in new audiences that would help bring more dollars to the space. And by leveraging data to more effectively connect individuals with causes and organizations that are relevant to them, we can increase the potential for both financial contributions as well as people to give back in other ways – whether spreading the word about a particular campaign or organization, or volunteering in some capacity.
Nell: A huge challenge of any new social media application is getting a critical mass of people to actually start using it. How do adoption rates factor into your plans?
Brian: That is absolutely correct – the Giving Graph concept will be a collaborative effort in many ways. One aspect is the data. In addition to tapping into different data sources, partnerships among additional organizations will be necessary. We need a series of nonprofits, for profits, cross-sector foundations, and other companies to contribute and share information into this graph to maximize the potential. This can be a challenging component, as data in today’s world is very valuable. Nevertheless, we have started conversations with various organizations about sharing data for the benefit of the graph and we’re optimistic. We’re at a turning point in data sharing, as organizations are becoming less reluctant to share than they have been in the past.
Another aspect of the project is end-users, and they appear in various ways. It could be a program manager at a nonprofit who is identifying a program to implement at her organization. In another instance, it is a college student trying to find out a local seminar to attend based on his charitable interests. For individuals, we are not going to put a front end on this database. The idea is that applications/platforms will be able to tap into this graph and ultimately provide users the ability to plug in their information, and for platforms to then integrate this information into the larger graph.
So absolutely, critical mass from both a data and usage point of view will play an important role in this project. It will take a lot of relationship building and trust, especially around data. The web is transforming into an experience that truly knows the end-users. The Giving Graph is unique because it not only represents another way for the web to understand end-users, it also provides the ability to give insight into and improve the entire social sector as well.
Nell: Why did the Case Foundation decide to spend time and resources on creating a new technology for the overall philanthropic sector? How does this effort fit into the Foundation’s larger and longer-term goals?
Brian: Our founders Steve and Jean Case were responsible for bringing America online decades ago. They believe in the potential of technology, and particularly the Internet, to connect people together to drive positive social change. The Case Foundation has a storied history of investing in and leveraging new technology platforms for social good – from our investments in online giving platforms like Network for Good, Causes and MissionFish, to programs like the Make it Your Own Awards and America’s Giving Challenge. Our intent is not to create the graph ourselves, but rather to seed the conversation and collaborate with our partners to provide the sector with a new tool in their tech for good arsenal. We think this Graph concept has the potential to change online philanthropy and revolutionize the sector, sparking innovation in ways akin to the commerce and entertainment industries.