The Compassion Exchange: A Global Solution for Distributing Material and Service Donations

Joel Finkelstein, MA.

“We live in an age where compassion is no longer a luxury, but a necessity for our species to survive.“-H.H. Dalai Lama

The Rise of Material Donations: Opportunities and Obstacles.

In the charitable world, non-cash donations have predominated the growth of corporate giving since the end of the recession, showing year after year increases averaging greater than 10% since 20081. These non-cash donations include “excess inventory, pro bono services, use of company facilities, intellectual property, land and other asset donations.” At nearly 15 billion dollars annually, material donations now constitute the largest source of corporate donations in the world, dwarfing cash donations, and are likely to remain predominant in the coming years. The rise of material donations unquestionably benefits the charitable world, yet these donations are often non-strategic, with many material donations arriving to missions and organizations not best suited to use them.

What is The Compassion Exchange?

What if we could instead invent a system that matches each donation to its best and most impactful use? The mission of the Compassion Exchange is to solve this problem; to optimize the global market of goods and service donations by matching each donation to its best purpose and most exigent need.

The Compassion Exchange is the first compassion based electronic marketplace and the basis of a new social contract for donation-based philanthropy. In addition to making a traditional cash or material donations, the Compassion Exchange will enable corporations and private donors to market their donation to the entire global, charitable community. As an e-commerce site, donors provide product and inventory information on their donations and member charitable organizations use the exchange to bid on the materials and services best suited to their mission. As an example, an affordable housing project in rural Belize will bid differently for plywood and construction material than an organization supporting breast cancer research in urban Tokyo. The Compassion Exchange will empower these charitable organizations to reach for the specific donations they need across a global menu of goods and services.

Fig 1. Non-cash donations have comprised the growing majority of corporate donations since 2007.

This same feature of the Compassion Exchange has another important benefit: Charitable organizations can also circulate the material donations they don’t need in exchange for the ones that are best suited to their missions. They can put these donations up for bid on the Compassion Exchange, provide them to other charitable causes that need them more and use the proceeds to obtain donations they can better leverage. The Compassion Exchange thus

caters to the diversity of needs for the charitable world by optimizing the global circulation of available goods and services (Fig 2.).

The Compassion Exchange will also empower donors to interact directly with the needs of the entire charitable world. Donors will populate the Compassion Exchange with service donations, offering their expertise in legal-council, accounting time, graphics and web development or other forms of skilled labor. They can also offer material goods such as property, facility use, vehicles, medicines or computer hardware and electronics and put all of these services up for bid on the exchange. Rating systems on delivery of goods and services are attached to each provider allowing for reputation-based evaluations in all transactions.

Compassion Coin, the Currency of the Compassion Exchange.

There is a problem however, with bidding on donations by definition: Donations someone bids on aren’t donated – They are purchased. To solve this problem, the Compassion Exchange will use a special form of currency called Compassion Coin, a transparent, digital currency with a central ledger. Items for bid on the exchange can be purchased exclusively by Compassion Coin. the coins are provided and produced by the Compassion Coin’s not-for-profit organization, the Compassion Coin Foundation. After a successful bid, coins are recycled back to the charitable causes by the donors themselves in a closed, positive feedback loop - profit is never made. Compassion Coin solves the problem of creating and distributing a scarce currency, on the one hand, but closes the market as a loop on the other, allowing goods and services to circulate without ever making a profit.

The transparent central ledger lies at the core of how Compassion Coin works and offers powerful leverage to the structure and functionality of the Compassion Exchange. The ledger contains all transactions from the inception of a coin to its end. With this transparent ledger, Compassion Coin can exponentially improve the circulation of material goods and services in the charitable world in 4

key ways that would be impossible with a regularly currency. Compassion Coin will empower a community distribution system, create unprecedented transparency for donors, create a new platform for global philanthropy analytics and fund the Compassion Coin Foundation:

1. Empower the global community with a voice and a vote. The community decides how coins are distributed because the worth of a charitable cause is best measured by the support of the community. The distribution scheme is simple: any time registered users donate cash to any of the curated charities on the compassion exchange, these donors will automatically receive a proportionate number of coins (1$:1 Compassion Coin) for their donation. Now, in addition to their cash donation, donors can distribute a proportional number of compassion coins to the causes and organization they deem fit. The favor and support of the community thus directly translates into greater purchasing power for cars, legal work, building material and medical supplies for charitable causes.

“A lack of transparency results in distrust and a deep sense of insecurity.”-H.H. Dalai Lama

2. Establish unprecedented transparency. All charitable causes must employ a public wallet in order to receive distributions of compassion coins and obtain membership to the compassion exchange. This means that all of the transactions on the exchange are perfectly transparent to each donor on the central ledger. How organizations spend their coins and what donations they obtain with them comprise an unbroken and perfectly disclosed chain of transactions from start to finish. Users will see how their coin donations are being employed and gain a personalized summary for each transaction. Not only does this offer unprecedented transparency for the users, it automatically enables causes to show their value proposition to donors. Compassion Coin therefore instantiates a new capability for absolute and crowd-sourced transparency in the world of charitable causes.

3. Create a global platform for philanthropy analytics. Because so many charitable causes will populate the Compassion Exchange, the ledger, in combination with Compassion Exchange, will preserve global information about supply and demand in the philanthropic world. What items are demanded most by charities, how much do they value these

Fig 3. The community distribution system. 1) Donors provide cash donations to curated charitable causes. Coins are automatically provided to donors by the Compassion Coin Foundation in proportion the donor’s gift. 3) Donors can then assign coins to the causes they deem fit

donations? What kinds of organizations are bidding on which items and how does demand differ between regions and organizations? The transparent ledger, can, for first time, portray this information and display it publicly. Analytics applied on this data could revolutionize the efficacy of global philanthropy, inform policy and give rise to more strategic donations.

4. Fund the Compassion Coin Foundation. In exchange for providing compassion coins, the Compassion Coin foundation will charge small processing fees for processing monetary donations to its member charitable causes. The use and popularity of the coin will permit the foundation to hire developers, pay salary and fund events and operation costs. The success of the coin will perpetuate the success of the foundation without ever having to ask for additional donations.

Compassion Coin is leveraged by the Compassion Exchange to solve a public goods problem. It uses digital currency technology to implement a new social contract between the community, donors, and charitable causes. This contract permits greater transparency, community participation, analytical tools and fiscal support for Compassion Coin Foundation.

To summarize, The Compassion Exchange represents a global marketplace that circulates the flow of goods and services to charitable causes, features a new form of charitable currency, and squarely positions the community as its own advocate, as the agent best suited to help itself. If successful, this ambitious project represents a “New Deal” in the world of goods and service donations, one that erodes the gaps between givers and receivers, that uses new tools of modern

technology to create transparency and that recognizes that the responsibility to repair the world belongs to all of us.

The Compassion Coin Foundation

The Compassion Coin Foundation is a registered not0for-profit organization and the charitable wing of Compassion Exchange. It is the transparent, governing body for the distribution of coins to partner charitable organizations and it has 5 specific aims:

Organize and maintain the Compassion Exchange where not-for-profits can exchange compassion coins for donated goods and services.

Ensure and monitor the fair distribution of compassion coins in accordance with the will of the community.

Fig 4. Donors can put material donations up for bid on the compassion exchange. When the bidding ends, in addition to donating the item, donors also receive compassion coins from the winning bid, which they then distribute charitable causes.

Create events and Compassion Exchange fundraisers for charities and use the brand to accomplish good in the world.

Work with web developers and open source community to advance the future of the Compassion Exchange.

Encourage private and corporate donation to the Compassion Exchange.

Launch plan and first milestone.

The official launch of the coin and first major milestone, will be implemented as a hosted, online fundraiser (by someone of sufficient fame) to directly issue coins to charities in order to begin placing coins in circulation.

Once the community voting system is tested and launched, the foundation will obtain high-level donations from corporate sponsors such as laptops, valuable services and property and host an inaugural launching party for the coin that puts these goods up for auction. The foundation can entice donors to provide these donations not only by the promise of efficacy, but also through promoting donor’s brands and reputations with the outcomes of this major event. The foundation can offer publicity opportunities for corporate donors by tying their brand to the unique success of their donation on the Compassion Exchange. The not-for-profits can then use compassion coin to bid on these high-ticket items, creating a strong proof of principle, a major media event and a demonstrative test case for the coin.

The “reveal” at the end is that this is not merely a one-time event, it is actually a platform that demonstrably distributes goods and services repeatedly. In this way, this publicized event serves as a surreptitious reveal for the actual platform. This will require a fully functional web site, auction site, coin, wallet as well as curated goods and charitable organizations.

Business planning: Funding:

The Compassion Coin Foundation will raise initial funding followed by a first round of investment that will kick start the full compassion exchange platform. Subsequently, the foundation can fund itself in two key ways: processing fees for transactions on the compassion exchange (which generates Compassion Coins) and by pioneering the new service of philanthropy analytics.

The foundation will initially seek an initial kick starting fund of $40,000 in order to:

1. File the initial provisional US patents to protect the technologies developed within the frame of the compassion coin foundation through a patent attorney.

2. Develop an initial prototype through an extensive network of highly talented programmers.

3. Conduct a thorough customer survey that will help to develop a customer oriented compassion coin platform and to develop a sophisticated business plan.

4. Prepare a high end pitch presentation for the project

Following the initial funding, a conference hosted by The Center for Compassion and Altruism Research and Education at Stanford that will gather potential customers and investors in order to raise the first round of investment.

The first round goal is to raise $400,000 which will help initiate the full fledge compassion exchange platform in its first year and will spent as follows:

Personnel costs 330000 $Marketing costs 50000 $Travel expenses 20000 $Total costs 400000 $

Detailed personnel costs are follows:

Personnel SalaryDirector 100000 $Administrative Assistant 50000 $Lead Developer 90000 $Software Engineer 90000 $

Personnel involved in this development of the compassion exchange are depicted in the following organogram:

Gabriel Lifton-Zoline (Director): responsible for donors’ relations, marketing plans and overseeing the day to day functioning of the organization. He will have an administrative assistant to help him with his tasks.

Mickey Cohen (CTO): responsible for overseeing the development of the compassion exchange technical architecture and supervising the lead developer and software engineer.

The board of directors for the compassion exchange will consist of: James Doty, Joel Finkelstein and Ahmed El Hady. They will contribute, along with the core management and technical team, in making the compassion exchange become the first and the largest global digital philanthropy network.

Marketing:

Marketing for the compassion exchange will be first done through word of mouth with our extensive network, participation in conferences such as TED, DLD, talks at corporations, professional and educational institutions. We will also seek publish articles about the compassion

exchange in internationally recognized newspapers and widely read magazines such as New York Times, The Atlantic, etc… An aggressive marketing strategy should aim to increase our visibility and to promote the feasibility of the compassion exchange as the future of philanthropy.

Business development:

As the cost to maintain a corporate social responsibility department and the rise of interest in philanthropy among the global elite increase, a strong need is emerging for an optimized and tractable manner to allocate donations. As the compassion exchange grows globally, it’s capacity to uniquely analyze data streams on the distribution, demand and supply of philanthropic goods will become its chief principal strength. Combining these data streams with state of the art analytics algorithms, we will be able to provide large corporations with on shelf solutions to allocate resources and ultimately take integral part in their social corporate responsibility. The compassion exchange will open up a new era of digitized corporate social responsibility, one that can penetrate into the world’s most exigent needs with foresight, transparency and strategic precision.

Who We AreBoard of Directors

Mikey Cohen is a senior architect and principal engineer for the Netflix edge platform which is the front door for the Netflix streaming application. The edge platform supports more than ten billion incoming requests per day from over 1,000 device types and supports our over 48 million customers around the globe. Mikey has been a principal engineering leader at Netflix for over 9 years designing and leading engineering of the core systems and cloud infrastructure at Netflix including the Netflix API and edge services. He is the creator of Zuul, the open source routing tier that controls the edge of Netflix’s streaming and web services. Among the many key roles he has played at Netflix are architecting and building the Netflix edge service platform and the Netflix API, migrating and scaling Netflix services from a datacenter model to the Amazon’s AWS, building Netflix’s infrastructure out to multiple Amazon regions with failover from one region to another, and leading engineering for Netflix’s first social networking systems. His current areas of interest are in cloud reliability, high scalability, resiliency and dynamic cloud systems. Mikey holds a B.A in Mathematics

from UC Santa Cruz. His favorite movie is Monty Python and the Holy Grail. When he isn’t working, you might find Mikey playing banjo, in the forest foraging for mushrooms, or enjoying time with his wife and three daughters.

James R. Doty, MD, is a Clinical Professor in the Department of Neurosurgery at Stanford University and the Director of the Center for Compassion and Altruism Research and Education as Stanford University School of Medicine. He is an inventor, entrepreneur and philanthropist having given support to a number of charitable organizations including Children as the Peacemakers, Global Healing and Family & Children Services. These charities support a variety of programs throughout the world including those for HIV/AIDS support, blood banks, medical care in third world countries and peace initiatives. Additionally, he has endowed chairs at major universities including Stanford University and his alma mater, Tulane University. He is on the Board of Directors of a number of non-profit foundations including the University of Southern California Brain and Creativity Institute, the Friends of New Orleans (FONO) and the Dalai Lama Foundation of which he is Chairman. He is also on the International Advisory Board of the Council for the Parliament of the World’s Religions.

Joel Finkelstein, MA, Ph.D. candidate is the founder of Compassion Coin and acting co-director of the Compassion Coin Foundation. He is a neuroscientist, a graduate student at Princeton University and founding fellow at the Center for Compassion (CCARE) at Stanford University where his research focused on the neural underpinnings of compassion and social behavior. Joel is a graduate fellow at the National Science Foundation, an entrepreneur and musician and has interest that span from mycology to machine learning. Formerly at Google, he has headed charitable and philanthropic events, established meditation courses and also

organized and spoken at international conferences on the psychology and neuroscience of compassion.

Gabriel Lifton-Zoline is the acting co-director of the Compassion Coin Foundation, a political organizer and author. He helped to craft Barack Obama's 2012 victory in Colorado and was the National Field Director and Senior Advisor for the Democratic Congressional Campaign Committee in 2014 where he devised a plan that saw the largest grassroots team in congressional election history assembled. Gabriel was also appointed as director for the National Day of Service by the Obama administration, one of the largest, nation-wide

community service initiative in the country. Gabriel is a skilled organizer, strategic planner, and has worked on new, more efficient ways to engage voters in the political process at a national scale. His writing focuses on educating a wider public on the pitfalls and failings of political campaigns and works to advance ideas for reform.

Affiliations and Sponsors

Compassion coin is an affiliated project of the Center for Compassion and Altruism, Research and Education at Stanford University.

1 CECP, in association with The Conference Board. Giving in Numbers: 2014 Edition.