philanthropy trends and impact on community foundations
TRANSCRIPT
Agenda
Our changing community & donors
Beyond grants
Beyond institutions
Beyond endowments & foundations
Beyond ‘strategic grantmaking’
Paths forward
“Your assumptions are your window on the world.
Scrub them off every once in a while or the light won’t come in.”
Isaac Asimov
Divided Nation
Political polarization
Income and asset gaps
Racial and ethnic segregation
Opting out
Declining Trust
Informed Americans who don’t trust nonprofits to “do what is right”1/3General public less trusting
Trust declined 2008-2014
Definition of Philanthropy
Social economy = all the ways we use private resources to create public benefits or public good
Lucy Bernholz
Phila
nth
ropic
Act
ion
Inve
stB
uy
Giv
e
Nonprofits Businesses Individuals
Recipient of Action
21st Century
Philanthropy
Phila
nth
ropic
Act
ion
Inve
st
Debt and equity Microfinance
Peer lending platforms
Buy
Rewards
Giv
e
Donation Donation Donation
Nonprofits Businesses Individuals
Recipient of Action
21st Century
Philanthropy
Crowdfunding
• $9.5B in
North
America
• Social causes
~ 19%
Phila
nth
ropic
Act
ion
Inve
stB
uy
Responsible purchasing
Artist and farmer CSAs
Fair trade
Sharing EconomyG
ive
Giving Circles, Micro-grants
Giving Days
Giving Circles, Micro-grants
Giving Circles, Micro-grants
Nonprofits Businesses Individuals
Recipient of Action
21st Century
Philanthropy
Social Giving &
Buying
Phila
nth
ropic
Act
ion
Inve
st
Green bondsCDFIsProgram Related Investments
Shareholderactivism, SRI, ESG
Mission Related Investments
Microfinance
Buy
Giv
e
Nonprofits Businesses Individuals
Recipient of Action
21st Century
Philanthropy
Impact Investing
Now 1 in 6 $
under
professional
management
Phila
nth
ropic
Act
ion
Inve
st
B-Corps and other hybrid entities
Buy
ResponsiblePurchasing
Responsiblepurchasing & supply chain
Cause marketing
“Bottom of Pyramid” products
Giv
e
Nonprofits Businesses Individuals
Recipient of Action
21st Century
Philanthropy
Power of the
Markets
Phila
nth
ropic
Act
ion
Inve
st
Impact investing
Community investment
Crowdfunding
Impact investing & shareholder activism
Venture funds, B-Corps
Some microfinance
Peer lending platforms
Buy
Tuition & healthcare
Products & tickets
Nonprofit social enterprises
Crowdfunding
Cause marketing
Responsible purchasing
Sustainable supply chains
Farm and artist CSAs
Fair trade purchases
Sharing economy
Giv
eCharities, foundations, DAFs, etc.
Other nonprofits
Gov’t agencies
Crowdfunding
Crowdsourcing & co-production, co-working
Remittances
Candidates & bundlers
Crowdfunding, prizes, grassroots $
Nonprofits Businesses Individuals
Recipient of Action
21st Century
Philanthropy
Tony Macklin, CAP®, 2015
Hyperagency – the inclination and
ability “to be producers rather than
simply supporters of philanthropic
projects.” – Paul Schervish
Donor-Advised Funds
22
Community Fdn DAFs$4.2B grantedBy 66k funds
National DAFs(Schwab, Fidelity,
National Christian)
$5.5B grantedby 128k funds
Single Org* DAFs$2.8B granted by 45k funds
* hospitals, universities
Trends
•Suspicion of endowed wealth and big money power
•Tension of transparency vs. privacy (“dark money”)
•Pass-through, spend-up, flexibility
Private Foundation + DAFs
Family Foundation + 501(c)(4)
B Corp Investment Fund + Foundation
Checkbook + PAC + Community Dev Bank
Social Impact Exchange, Impact Assets 50
LLC + DAF
Tensions
Top-down goals and measures
Adaptive, “possibility” grantmaking
AccountabilityLearning, performance improvement
Safe, proven methodsSmart risk, fail fast, low-cost innovation
CFs in the Future
“No longer a franchise with a protected territory”
Core functions are commodities
• Managing charitable assets
• Processing gifts, grants, and scholarships
• Accepting complex gifts
• Information about causes and nonprofits
• For some people, finding peers with shared passions
Successful CFs in the Future
1. Get clear about creating value for the community and for customers (donors)
2. Shift resources spent on commodities to value creation
3. Understand
• Managing & giving money doesn’t automatically create value
• Building an institution doesn’t necessarily build community
Value Creation Option 1:
High Touch Donor Services
Financial Human
Intellectual Social
Capitals
“Your advisor for doing good”
Goal: the center for family &/or corporate philanthropy services
Value Creation Option 2:
Host for Community Problem-Solving
Nat’l study: Donors want to be attached to CF with good community problem-solving and leadership work
• But “leadership” doesn’t mean “in charge”
Facilitation, issue analysis, innovation, assessment, collaborative funding roles, donor leadership, etc.
Goal: asset development & fundraising as purposeful result of effective problem-solving work
Value Creation Option 3:
Catalyst for “Community Philanthropy”
“Citizens helping each other by sharing resources for the common good” - self-determination, mutual help strategies
Three core components:
• Collective financial resources
• Collective capacity – healthy civil society
• Mutual trust
Goal: unleashing generosity, increasing flow of $