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
Since I was out of the office for part of July and checked out of social media (which I highly recommend!), the below list is in no way comprehensive. But it is what caught my eye in the world of social innovation in July (when I was paying attention). More than ever, please add what I missed in the comments below.
You can see the 10 Great Reads lists from past months here.
- In a highly provocative op-ed, Peter Buffett, son of Warren Buffett, wrote a pretty scathing rant against today’s philanthropy, calling it “conscience laundering — feeling better about accumulating more than any one person could possibly need to live on by sprinkling a little around as an act of charity.” Needless to say, much argument followed, including Howard Husock’s post arguing that Buffett is “far too pessimistic about what philanthropy, well-conceived, can accomplish.”
- Dan Cardinali, CEO of Communities in Schools and an emerging voice on the importance of measuring nonprofit outcomes, wrote a third piece in his series on redefining the nonprofit sector. This one explores the need for nonprofits to “hold ourselves accountable to objective measures and quantifiable outcomes.”
- And another nonprofit leader trying to shake things up, Bill Shore of Share Our Strength, offers the provocative “We Just Don’t Have the Money, and Other Fibs We Tell Ourselves“.
- Antony Bugg-Levine from the Nonprofit Finance Fund provides additional fodder to the conversation with his post “Navigating Tough Trade-offs in the Era of Scarcity.”
- Lucy Bernholz, philanthropy truth teller and future seer, offers three ways we can reinvent philanthropy in this great, short video brain dump.
- Kathleen Enright, CEO of Grantmakers for Effective Organizations, talks with Paul Carttar, former Director of the Social Innovation Fund, about what he learned there. It remains to be seen what impact the Social Innovation Fund will have, but as Paul says, government can and must play a role in social innovation, “The challenge for everybody — for government and for philanthropy — is to understand what each has to offer.”
- The New York Times uses Think Impact (which encourages entrepreneurship in third world communities) to provide an interesting case study of the dilemma of deciding whether to be a for-profit or nonprofit social change organization.
- Ever provocative, Phil Buchanan from the Center for Effective Philanthropy argues that the approach MBA programs take in teaching philanthropy “denies the reality that nonprofits and philanthropy work to address the problems that have defied markets…and, in many cases, are a result of market failure.”
- Writing on the Pioneers Post blog, Jeremy Nicholls takes issue with the word “impact” and encourages us to think about “value” instead.
- The National Committee on Responsive Philanthropy found that in 2011 American foundations increased unrestricted giving by 50% (from 16% of all grant dollars going to support general operating in 2010 to 24% in 2011). Now that’s an exciting trend!
Photo Credit: josue64
Perhaps it had something to do with the SXSW Interactive conference last month, but March was all about using technology in interesting ways to further social change. From crowdfunding, to a new giving graph, to credit card donations to the homeless, to engaging people in the arts and beyond, people are experimenting with technology for social change in really exciting ways.
Below are my 10 favorite social innovation reads in March. But let me know in the comments what I missed. And if you want to see my expanded list, follow me on Twitter, Facebook, LinkedIn, Pinterest or ScoopIt.
You can see the 10 Great Reads lists from past months here.
- Crowdfunding is quickly becoming the hot new thing in the social change world. It remains to be seen if it is a game changer, but in the meantime take a look at some examples of how its being used here, here, and here. And while we’re talking about innovative use of technology to fundraise, Lucy Bernholz dissects some new efforts to donate to the homeless via a credit card.
- Writing on the ArtsFwd blog, Anna Prushinskaya describes how some innovative arts organizations have used social media to effectively engage audiences in new ways.
- I’m really excited about a new technology the Case Foundation is developing that will map your online search preferences to giving suggestions just like Google, Facebook and others currently use your search preferences to suggest products and services. (I’ll be interviewing the mastermind behind this, Will Grana, on the blog this summer).
- I love to see nonprofits using new media (like video and infographics) to tell their story. Beth Kanter offers some easy tips for creating infographics. And speaking of cool infographics, check out this one on why slacktivists are more active than you think.
- It seems “scale,” the social innovation buzzword of a few years back, is being redefined. Kathleen Enright, CEO of Grantmakers for Effective Organizations, describes a new report that expands the idea of scale and offers ways grantmakers can support it. And Ben Mangan, CEO of nonprofit EARN, spurs nonprofits and funders to move past “stifling incrementalism” and start working towards real scale.
- Dan Pallotta ruffled some feathers, as is his way, with his TED Talk this month The Way We Think About Charity is Dead Wrong, and there were several responses. But I thought the most thought-provoking was from a group of professors from Boston who suggest that Pallotta’s argument that nonprofit salaries are too low only reinforces the wealth inequality of the American economy.
- And on a related note, Dione Alexander, writing on the Mission and Money blog, explains increasing wealth inequality as a kind of bullying, noting “The social contract through which we assume shared responsibility for the community is broken.”
- And since we are on the topic, this video about wealth inequality in America blew my mind. If you want a quick and dirty view of where America’s money goes, take a look.
- As part of the ten year anniversary of the Stanford Social Innovation Review, Matthew Forti looks back at the past ten years of measuring nonprofit outcomes, the good, bad and the ugly.
- Writing in the Duke Chronicle, Trinity senior Elena Botella argues that deciding when a public service should be privatized should be based on evidence, as she says “Humans respond to a profit motive, but we also respond to altruism, community values, prestige and pride in our work.”
Photo Credit: mendhak
With a national election, hurricane Sandy, and Giving Tuesday, November was a busy month. All three events encouraged reflection about social change. And at the same time we had some pretty interesting arguments for how two of the sectors supporting social change (philanthropy and government) needed to shift as well. All made for a fascinating month of reading.
Below are my top 10 picks for what was worth reading in November in social innovation. And as always, please add what I missed to the comments. And if you want to see an expanded list, follow me on Twitter, Facebook, LinkedIn, Pinterest or ScoopIt.
You can see the 10 Great Reads lists from past months here.
- Even though hurricane Sandy hit at the end of October, much of November was spent cleaning up and reacting to the powerful storm. Patrick Davis reflects on what our reaction in natural disasters says about human nature.
- And from Sandy we moved into the national election where, once it was over, there was much to learn. First Lucy Bernholz marvels at Nate Silver (the statistician that very accurately predicted the outcome of the election) and wonders what the corollary is in the philanthropic world. She asks “Who will be the first big philanthropist to put predictive analysis to the test in the social sector?” And apparently there is much to be learned from the Obama campaign’s email tactics during the campaign.
- November also saw the launch of “Giving Tuesday,” an online effort to kick off the philanthropic season, just as Black Friday and Cyber Monday are the beginning of the commercial Christmas season. While it seems like a great, innovative idea, Tim Ogden disagrees arguing that it won’t “materially affect giving in any positive way.”
- It looks like it’s time to get tough with foundations. The PhilanTopic blog argues, “No More Free Rides: Foundations Need to Increase General Operating Support Now.” Amen to that! And GlassPockets, the Foundation Center’s online effort to increase foundation accountability and transparency now has 50 foundations participating, representing $138 billion in assets and more than $6.5 billion in annual giving, or 15% of all U.S. foundation giving.
- And the government has work to do as well. Former Social Innovation Fund Director Paul Carttar writes a call to action about what government can do to more effectively encourage social innovation.
- The drum beat for nonprofits to measure outcomes continues. Writing on the Stanford Social Innovation Review blog, Mollie West and Andy Posner encourage nonprofits to go the way of business and government and start using The Math of Social Change.
- And there is a really interesting new development in the ongoing effort to compare and rate social change organizations. The Social Impact 100 Index was unveiled in November. Modeled after the S&P Index in the financial markets, this effort by the Social Impact Exchange analyzes and picks the best 100 nonprofit investments for donors. It will be very interesting to see how this effort evolves and whether it transforms the nonprofit rating space.
- Despite a tough economy, charitable giving rose slightly in 2011. But the real news is that online giving has grown to a $22 billion industry.
- And speaking of fundraising in the online world, social media has completely disrupted the old model for how a nonprofit engages a donor, so says Julie Dixon and Denise Keyes. And Kivi Leroux Miller agrees.
- On the Managing the Mission Checkbook blog, Kate Barr cautions that nonprofit sustainability isn’t just about revenue, it’s about 1) working to achieve your mission 2) integrating a successful business model and 3) adapting and changing. Agreed!
Photo Credit: kadorin
There were lots of great discussions and developments in the world of social innovation in September. So much so, that I had a really hard time narrowing down to ten. But alas, here are my top 10 of the last month. As always, please add what I missed to the comments. If you’d like to see the expanded list of what catches my eye, follow me on Twitter @nedgington.
You can also read the lists of Great Reads from previous months here.
- Two really interesting divergent reports on the results of social change work. First, a $1 million, 6-year study of nonprofit After School Matters shows that the program doesn’t really change lives.
- And a year after Facebook founder, Mark Zuckerberg’s $100 million grant to Newark public schools, some positive results are trickling in.
- After the August resignation of Steve Jobs from Apple due to health reasons, people came out in droves to criticize him for his poor philanthropic record. Dan Pallotta rose to his defense, arguing, in a thought-provoking way, that Jobs’ contributions to the world at large make him the World’s Greatest Philanthropist.
- In an exciting move to kick-start social impact bonds (a government bond that allows private investors to invest capital in nonprofits and then gain a return if the nonprofit achieves promised outcomes), the Rockefeller Foundation granted Social Finance $500K to develop the social impact bond market in the US.
- September was the month of the 4th annual Social Capital Markets Conference that brings social entrepreneurs and the funders of social entrepreneurs together. Over the course of the four SoCap conferences there has been a recurring tension between philanthropy and impact investing. Adin Miller reported from SoCap that the great convergence between philanthropy and impact investing has disappointingly not yet happened.
- The Washington Post shows us the devastating impact of the economic crisis in five charts.
- At long last, CharityNavigator, one of the best known nonprofit rating systems, unveils their Charity Navigator 2.0, an expanded rating system that includes financial health, accountability, and transparency measures. Every nonprofit should understand this important change and what it means for their organization.
- Lucy Bernholz discusses a fascinating distinction between problems and difficulties and the implications for social change efforts. “Problems have solutions; solve them and problems go away. Difficulties don’t have solutions; they require continual address.”
- On the Harvard Business Review blog Lucy Marcus argues In Troubled Times, Boards Must Step Up.
- In a similar vein, Mario Morino from Venture Philanthropy Partners argues that Board Members Cannot Check Their Courage at the Door.
Photo Credit: MMcQuade
In our ongoing blog series, 10 Great Social Innovation Reads, below are my top 10 picks for the best reads in the world of social innovation in June.
What were your favorite reads this month? Add to the list in the comments.
- The SocialEarth blog argues that the staggering unemployment numbers for America’s youngest workers could be an opportunity for entrepreneurship.
- As IBM and the Carnegie Corporation both turn 100, Matthew Bishop from the Economist analyzes which has done more social good.
- The Philanthropy411 blog gives us an updated list of foundations and funder networks on Twitter.
- With the advent of greater tools for understanding social return on investment, Adin Miller asks the question: Do funders need exit plans when they determine a better SROI elsewhere?
- Lucy Bernholz makes a call for more transparent philanthropy.
- Sean Stannard-Stockton takes large foundations to task for not participating more actively in the Social Innovation Fund.
- “Perhaps a useful definition of visionary leadership is the ability to not be unduly swayed by the implied or expressed goals of those outside your own tent,” argues Craig Reigel on the Nonprofit Finance Fund blog.
- FastCompany provides a great list of what business, CSR and nonprofit leaders are reading this summer.
- The PhilanTopic blog gives a useful analysis of what the recently released GivingUSA 2011 data tells us about where giving is going. And Bob Ottenhoff from GuideStar gives his take.
- Curtis Chang argues that blaming the recession for a budget shortfall just isn’t going to cut it anymore.
Photo Credit: Simon Cocks
In the August installment of our Social Velocity interview series, we are talking with Lucy Bernholz, founder and President of Blueprint Research & Design, Inc. a strategy consulting firm for philanthropic institutions and individuals. She is also the author of many seminal books (including the prescient Creating Philanthropic Capital Markets), reports (like Disrupting Philanthropy) and her famous Philanthropy 2173 blog. Lucy is considered a visionary in the philanthropic world and is doing tremendous work to move philanthropy forward.
Nell: You have become increasingly interested in data sharing and crowd-sourcing for change. What are the risks in these new forms of social problem solving?
Lucy: Data are not objective – quantitative data is subjectively collected, categorized, sourced, and analyzed and its “reputation” as neutral is unearned. Using data well requires skills that most of us don’t have – statistical analysis, methods, etc.
That said, when I talk about data I mean “anything that can be digitized.” Stories. Video. Anecdotes. Numbers. We may not all have all the skills to make sense of every type of data, that is partly why crowds are important. For decades, only experts and the wealthy had access to data – so their subjective analyses dominated the discussion. Now, many of us – crowds – can have access, make sense of, add nuance, ask questions. That changes the “subjectivity” and changes the dynamic. Data are disruptive when access to them is broad, cheap, and easy.
We still need to be skeptical, ask questions, and think deeply about the biases behind both data collection and presentation. But, as computer programmers say, “many eyes make for shallow bugs.” Crowds and data are two sides of the same coin when it comes to disrupting the social sector.
Nell: In Disrupting Philanthropy you examine the long tails of donors (foundation and individual contributors of money for social change) and doers (nonprofits, social entrepreneurs receiving that money) and how information technology is connecting the two. But as a future teller, how and when do you see more conservative/fearful nonprofits and philanthropists embracing these new technologies? What is the tipping point?
Lucy: There are few pressures on endowed foundations to change their behavior. It is hard to force this change from the outside.
The drivers of change in this day and age include new expectations about information at a societal level, the government 2.0 movement, the skills of two to three generations of employees and managers in using online tools and finding information when they want it. These are the soft, cultural, and ultimately most meaningful drivers of change. Regulations that require more disclosure, new expectations of transparency, efforts such as The Foundation Centers Glasspockets.org, the Center for Effective Philanthropy’s assessments are other possible influencers of the timeline.
That said, don’t discount the inevitable backlash against transparency, which is coming. Recent online “revelations” that have been fueled by political agendas and resulted in “flash decision making” highlight the need for all of us to be careful about the pace of information, believing everything we read, and the need for thoughtful, investigative, well-referenced and fact checked information. As Craig Newmark says, the news business is the “immune system of democracy.” As the news business is caught in this wildly transformative moment, we must all consider where we get our information, how we use it, who provided it to us, and what its credibility is. There is no straight line to widespread adoption of new tools – it is episodic and includes strange diversions.
Nell: Where does government fit into the connection between donors and doers? What can/should government do to encourage use of data sharing, crowd-sourcing, etc.?
Lucy: The government 2.0 movement is way ahead of nonprofits and foundations in the open sharing of data. That said, most of this is a “supply side” effort at this point – cities, states, and federal agencies shoveling data over the wall into the public domain with little knowledge of what information communities want or need and even less support for communities to use the information well. Firehousing data into the public domain is one thing, but it is not enough (It can also work to distract – “You want data? Here have it all”)
As for nonprofits and foundations, the data disclosure requirements of the new 990 are small steps in the right direction. Most of what will happen as far as nonprofits and foundations sharing their data is likely to be voluntary, led by innovators, and taken up by others over time as communities and constituents learn to ask for what they want. The expanding ecosystem of nonprofit ratings/raters – from GiveWell to Greater Nonprofits to Philanthropedia to National Councils of Nonprofit Analysts, etc. will also spur this.
The proposed legislation, HR 5533, which calls for a national council on nonprofits and a central system for tracking nonprofits as funded by federal agencies is the wildcard here – if it passes, the data game on nonprofits and philanthropy will change. How so, and whether for the better, I can’t say at this time because I just don’t know enough (yet) about what is being proposed, how it is supposed to work, and how it will really work (if enacted).
Nell: As you mention in Disrupting Philanthropy, 10 years ago socially responsible investment was a small niche, but now it makes up 10% of professionally managed investment funds. How much bigger will it grow? How much can mission and money be blended in our economy?
Lucy: Socially responsible screened assets have been growing for more than a decade. This is a multi-decade trend that is growing mostly outside of the realm of the charitable and philanthropic sector and within the realm, incentives, and returns of the mutual fund business. Philanthropic efforts to connect to these assets and to promote Mission Related, Program Related spending are only now getting real traction and advocacy from within philanthropy.
Nell: Your focus is largely on philanthropy, but what do you think nonprofits should be doing to tap into these trends and take advantage of the long tails of donors and doers?
Lucy: Nonprofits are experimenting with every tool to reach the long tail that they can – from “donate now” buttons to text giving. For the most part, the process has been focused on marketing and fundraising. The exciting changes are happening where we see people developing solutions that take the digital connectivity and data as the starting point for the work they are trying to do – think about Ushahidi or CrisisCommons – their entire programs/projects/initiatives/governance models/organizations are built on deep understanding of the power of disbursed long tails. That is powerful.
Nell: Because you are such a proponent of data and measurement, what do you make of the emotional part of giving? Do you think we can ever get to a place where it’s all about the data? And should we want to?
Lucy: I have always said that philanthropy is a business of passion – it is largely emotional. The use of data, as Hope Neighbor’s recent report shows, is a small part of the process of philanthropic decision making. And it will always happen within the personal interests of donors. And please remember, when I say data, I don’t mean just numbers.
Lucy Bernholz is hosting a great conversation on her Blueprint Research and Design website called “What Capital When?” As part of their work with the John D. and Catherine T. MacArthur Foundation in their Digital Media & Learning initiative, Blueprint is hosting this online conversation around the theories and strategies of program-related and mission investing to advance knowledge and research in the field. They asked that I do a guest post on using PRIs (program related investments) to improve the fundraising effectiveness of nonprofit organizations. Below is that post. You can also read the post on their What Capital When site here, and you can read the whole series here.
I think there is a tremendous opportunity that most foundations and nonprofits are missing. PRIs (program-related investments) are an under-used tool that could provide much needed capital for nonprofits to transform how they finance social impact.
PRIs are loans that foundations make to nonprofits at low, or no interest. At the end of the loan period (typically 3-7 years) the loan is repaid, or forgiven. PRIs are usually used for capital projects or land purchases in the nonprofit world. But they could also be used to increase the fundraising capacity of a nonprofit organization, through increased fundraising knowledge, planning, tools and staffing. The current economic climate seems like the perfect opportunity for this new use of PRIs when foundations are trying to hold on to their dwindling corpus while maintaining their past level of community support.
A nonprofit could use a PRI to improve their fundraising infrastructure in several ways:
- Create a strategic development plan. Many nonprofits don’t have the expertise or time to put together a strategy for how they will bring money in the door. With funding to hire an outside consultant to put together such a plan, the nonprofit would have a much better chance of increasing their fundraising revenue.
- Get fundraising training for their staff and board. If a nonprofit staff and board have the tools and expertise for successfully raising money, they will be more likely to do so.
- Hire a seasoned Development Director. Many nonprofit organizations can only afford to pay the bare minimum for a Development Director, which means that they are often forced to hire someone with little experience who must learn on the job. If instead they had enough funding to pay a market rate salary for a seasoned fundraiser, they could hit the ground running, increasing the likelihood of fundraising success.
- Purchase a new donor database. A key element to success in individual donor fundraising is an organization’s ability to capture and use data about donors and prospects. A good donor database makes this effort easier and more successful.
- Upgrade their website, email marketing, social media efforts. As direct mail appeals (a nonprofit fundraiser’s traditional standby) continues to become less and less effective, nonprofits need to move effectively into the online world. Funds for technology upgrades and staff could help them do this.
- Launch a major gifts campaign. The vast majority of private funding in the nonprofit sector comes from individuals (80+%), so to stay competitive nonprofits need to move into the world of major gift solicitation. But that takes expertise, staff, collateral and other infrastructure elements.
These are just a few examples of how nonprofits could make investments to strengthen their fundraising efforts. But currently it is difficult to find funding to support things like this.
But a PRI could provide an initial investment that sets the nonprofit on a path toward more diversified, more sustainable fundraising for the social impact they are working to create.
There are tremendous benefits to a PRI program like this. First, for the foundation:
- Increases their ability to meet past levels of giving, despite any losses they might have found in the market, because the loaned money will eventually come back to them.
- Encourages their nonprofit grantees to be proactive in creating fundraising streams that will make them more sustainable. Thus, increasing the likelihood that their nonprofit grantees a) won’t have to come back to them year after year for ongoing support and b) will become more sustainable and thus achieve greater social impact.
- Stretches their capacity-building dollars further. Because PRI money eventually comes back to the foundation, they can increase their level of impact by helping more nonprofits improve their capacity than they could with grants alone.
- Increases the level of accountability among nonprofit recipients because of the expectation of repayment.
And second, for the nonprofit:
- More diversified and sustainable fundraising streams.
- Increased fundraising knowledge and experience.
- Increased ability to work towards social impact.
Although PRIs used in this new way seems, at least to me, to be an obvious win-win, very few foundations are doing it. PRIs in general are used (according to the Foundation Center) by only a few hundred of the thousands of grantmaking foundations in the country. And I know of only one example of a foundation using a PRI to upgrade the fundraisng capacity of a nonprofit (the KDK Harman Foundation in Austin just launched a program like this last Fall, but does not yet have any participants).
So what is holding foundations back from launching a PRI program like this? A number of things:
- Nonprofits lack the expertise to put a plan together and pitch it to foundations. This is where Social Velocity comes in to help nonprofits create a plan to upgrade their revenue function and pitch that plan to foundations and other funders.
- Most foundations have an aversion to capacity building funding and prefer that their money go to direct program service. However, as more nonprofits can demonstrate to funders that capacity building actually results in even more impact, this aversion can be alleviated.
- Foundations lack awareness of or experience with PRIs. However, this is changing, especially in the last year when the poor economy has made foundations increasingly interested in finding alternative ways to maintain community investment levels.
- Foundations that are experienced with PRIs are not aware of using them to improve a nonprofit’s fundraising function.
So there is a disconnect. But I am optimistic that as nonprofits learn to put a plan together to upgrade their fundraising function and articulate to funders how PRI’s could finance it, more examples of this new use of PRIs will surface.
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