I am currently participating in the Illinois Task Force for Social Innovation. And working on ci2iglobal, and transitioning Inspired Legacies. Having worked in or around nonprofits and philanthropy for a decade, I have seen the field changing. I remember the first budding of Mission Related Investing, when there were basically 3 foundations championing it. Then I discovered people were doing Program Related Investing, and we started to see a broader spectrum of how money was being used in the philanthropic sector. We were collectively working to optimize how much money was creating purpose-filled value.
Last year I toyed around with some friends on mapping the financial spectrum. We are doing it again with the task force. It is exciting to see the hybridity between for-profit and for-purpose work and the financial innovation to support it.
However, concurrently there has been an increasing demand for nonprofits and social purpose organizations in general to quantify what they do. When I look at what I consider charity (aka bandaids on existing issues), these metrics really help tell the story about what an organization is doing to deliver that bandaid.
And… my struggle all along, even before I joined the social change effort, was to find the big levers that shifted how things are. What would it take to remove the need for these bandaids? I keep looking for the big levers.
But big levers don’t get funded until they pay off. Usually.
I never bothered to even look for foundation funding or grants for my work on shifting culture to be more thrivable. Who gives grants for core culture change? I think it ought to be funded. It may actually catalyze more transformation in the system, by aligning people and projects along a story. But how do you measure that? How would you even track the spread of the idea, all the people making hundreds of choices differently because they started to see the world differently? At the end of the journey, you can find your way back. But where is the end of the journey? Can you find where it ends and hear back? Do people even come back to you 2-5 years later and tell you a story of how “thrivability” led them to do something different. (Usually only when they know you.) If five years from now, scientists working on environmental science shift their view to look at the world from a thrivable perspective and it unlocks something that allows a cascade of action to follow that make the world more livable, can I claim that as my impact? Could I possible ask for money for the hope that this happens?
2. Be more like an investor and less like middle management
In startup land, this isn’t unreasonable. A startup can develop a product or an idea, pitch it to investors, get some funding…and if their idea works, the funder gets payback. If it doesn’t…well, losses all around. Investors know that most of what they fund will fail. It is an art of finding enough that succeeds with big enough returns to keep going. Where is this attitude in philanthropy? Both transformational change and startups live in complex adaptive systems… they can’t be predicted and causality is challenging if not impossible. And yet, there is a vital part of the startup world funded by people willing to put big dollars into unpredictable possibilities for the small opportunity of making a big return.
Philanthropy, in adopting more practices from the business world, took on a middle management mindset in far too many cases. Instead of optimizing for what might make the biggest change in the area to address, the optimization has tended toward who can show impact in the funding cycle. It tends toward projects that have strong “predictability” in them. I know how many people will be fed, clothed, housed, cared for if the project is funded.
Let’s be careful here. There are some foundations and philanthropists that are willing to be risky with their giving. They give to a collection of efforts knowing that some won’t turn out as hoped. They may even fund across the spectrum from highly predictable charity efforts to systemic change efforts. But the general vibe of the field is one of mitigating risk of money being used ineffectively by having the metrics to back it up.
3. I want to see a Venture Capital Philanthropy company.
adVenturePhilanthropy or something. They share the risk of some of the projects not achieving desired results…but have smart portfolios of giving capital. Think of it like a high end giving circle where you pay sophisticated philanthropic advisors to fund a portfolio of efforts on causes that you and others care about. The advisor or firm then shares with all the donors the report on value created through giving.
4. And, like a business, ROI can be based on value created instead of “impact” made.
Impact. Benchmark. Difference from before. What is the impact? I want to see what is the value. Can we switch from impact assessment to tracking the value created? By doing so we open up more options for tracking the transformational work we want to do in really evolutionary giving. (We are working on this in the book Christelle Van Ham and I are writing called, for now, Action Spectrum).
5. Power Adjustments
Additionally, as someone who has managed to avoid having any big donors to yank me around, we have got to get better as a collective about the co-creation of strategy. Grantees are so beholden by the power of the money a donor offers that they can’t say, “what you want me to do doesn’t work.” Instead they all too often feel like they must say whatever pleases the money master. This isn’t really their fault. Nor is it the fault of the givers of money. Both sides need to work on creating agency for everyone involved, which takes a lot of conscious practice and communication clarity.
Collectively, we need to truly and deeply believe that everyone at the table working on transformation has some value to contribute. That value may come in different forms: it may be time or ideas, or network or skill, and of course money or influence. When we cater to the one with the money we make small or even invalidate the other forms of capital at the table – the experience capital or intellectual capital etc. And that will undermine our shared goals. It gives us less assets to work with instead of more! We all have power. It can come in many forms. It doesn’t make us equal… it just allows us each to have something to offer. And thus everyone at the table of social transformation is valuable.