(This is a guest post from Steve Butz, President & Founder of Social Solutions, who is covering the Council on Foundations Conference for Tactical Philanthropy)

By Steve Butz

So I just left an afternoon session that I had been looking forward to…”The Impact and Future of Venture Philanthropy.” The session was lightly attended, 30-35 people, and the conditions for an interactive session were less than ideal due to both the setup of the space (classroom style) and the inattentiveness of the moderator.

The central tenants of Venture Philanthropy were discussed, which was interesting. I am more than paraphrasing here, but basically the 3 tenants put forth by Paul Shoemaker, one of the Presenters, (there were four but in my rush to write this blog I have forgotten one…) were 1) deep investments into an organization and its capacity, as opposed to programmatic focus, 2) generally more extensive involvement between the funder and grantee and 3) generally investments focused on long term organizational growth, with an eye towards an exit where investment will come from outside the initial investing funder.

There was another Presenter (I do not believe it was the same person referenced in the COF materials on the session so I will not reference him by name) who articulated some of the concerns that he had with Venture Philanthropy. Some of these strongly resonated with me- one example that stuck very clearly was the idea that VP tends to invest in orgs that are relatively new- as opposed to those (he mentioned specifically Catholic Charities, Boys and Girls Clubs and The Salvation Army) that have been doing “the lion’s share of the work with the lion’s share of the people who most needs services.” I thought this was a great and interesting point and I had not heard, at least so well articulated, this criticism of Venture Philanthropy.

Another interesting gem was Paul Shoemaker’s assertion that he does not understand why business people are so often not in favor of giving organizations unrestricted funds. I tried to publicly comment on this (was not chosen by moderator) but I found it very interesting, having been involved with Venture Capital groups, why Paul could not see that business people generally need to see a well thought out business plan in order to ensure that any investment made has a reasonable chance of success. I believe that the fact that very rarely (I know there are exceptions) are such well thought out plans laid before a board or funding organization is probably the core reason why private sector folks are opposed to such “general support.” I hope I am right, anyway, but I will agree with another of Paul’s main points- that the level of engagement of private sector individuals, in their role as board members of non-profits, currently leaves much to be desired. I have written more extensively about this in our white paper available here.

The session was a good primer on the basics of Venture Philanthropy but I would have liked to have felt a bit more of the capitalistic, “survival of the fittest organizations” mentality that I believe is an important part of Venture Philanthropy.

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(This is a guest post from Sandra Bass,
Program officer at the David & Lucile Packard Foundation, who is covering the Council on Foundations Conference for Tactical Philanthropy)

By Sandra Bass

Zzzzzzzzz…..okay it’s not like I shouldn’t have know better…I mean the title of the session did have the word “counting” in it…so that the session “Beyond Counting: What can we learn from Diversity related research” turned out to be a bit of a snooze is not surprising. That said, I think this was a ‘sleeper” session in more ways then one.

Before I launch into my thoughts on this I should disclose….I am an African American woman…I’m also very tall, a native Californian, a daughter, a sister, and an auntie and I have this odd personality quirk of being both a nerd and an extrovert…(think Urkel on hormone therapy) Yes, like many of us I have multiple identities, but for the purpose of this post, that I am one happy black woman is the most relevant. I also should note that this is me speaking for me…not my organization.

As many of you know a bill was recently introduced in California that would require foundations over a certain size to collect data on the diversity of the organizations they fund to determine how much funding goes to “minority led” organizations: minority led being defined as having a minority ED, 50% or more minority staff and board, and with a stated mission of serving minorities. This bill comes to us courtesy of the Greenlining Institute who conducted their own review of funding to “minority led” organizations by major foundations and found it wanting. The session talked about voluntary efforts within the sector to collect more comprehensive data then that collected by Greenlining to provide a fuller picture of how philanthropy is faring on the diversity front. Even though all the talk of surveys and data gathering made my eyes glaze over, how we define and assess diversity is one of the most pressing issues facing the field.

As today’s breakfast plenary poll showed, diversity is not our strength as a sector, however Greenlining definition of “minority-led” organizations is far too limited to fully articulate the range of foundation funding that goes to organizations and programs benefiting minorities. While I personally don’t think Greenlining was being intentionally malevolent in pushing for this legislation (in fact one could argue that their actions have raised the profile of this issue within our sector) I do think they are misdirected….let me count the ways:

1. While building and supporting minority leadership within the sector is a critical need, being a minority does not guarantee that a person will represent or serve the community of their racial/ethnic origin…let’s consider for example, the Clarence Thomas phenomenon. Although I haven’t seen the official DNA results, I’m betting Clarence Thomas is a black man. I’m a black woman…based on this logic, my interests are all taken care of in the Supreme Court because one of mine is sitting up there…yeah right.
2. I know an organization in the mid-west that came up with the great idea of helping poor people in the inner cities get to jobs in the suburbs by giving them low-interest loans to buy cars. An impact evaluation of their work found that once people had cars they could access higher paying jobs which increased their standard of living significantly. At one of their sites about 80% of the loan recipients were black. The CEO of this organization is white, and I suspect his organization would have a hard time meeting the “minority led” criteria as defined by Greenlining. So this program which has helped lift many black families out of poverty would not pass muster.
3. And at the end of the day, perhaps the most important reason these efforts will not lead to the desired change is that diversity is not about bean…or in this case head counting. As Mark Rosenman eloquently said in a recent Chronicle of Philanthropy op ed. “Diversity is not a question of inviting others into your house. The question is how the house might be renovated so it reflects the designs of all now in it”. We’re talking culture shift not counting.

Yes, we as a field have a lot of work to do on the diversity front, and yes, we should care that there are so few people of color working in philanthropy and leading non-profit organizations. However there are concrete actions that can be taken (like leadership development, organizational capacity building, voluntary sector-wide data collection, and strategic partnering) that can help us get there a lot faster then filling out forms to meet a government mandate.

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(This is a guest post from Debbie Kobak, Foundation Market Strategist at Shore Bank, who is covering the Council on Foundations Conference for Tactical Philanthropy)

By Debbie Kobak

I’ll admit that I have a bone to pick. Mission related/socially responsible investing, program related investment, community development…not only are these strategies for leveraging a foundation’s assets to make social change my bread and butter, they are my passion. So when COF puts together just one session on this fast-evolving and complex area of financial and social investment, I expect it to be worthwhile. I expect it to be substantive, innovative, and accurate. I expect the presentations to be made by a broad range experts with deep knowledge, representing the best practices in the field. I expect to learn.

I’ve gotta say, I found this morning’s panel on the socially responsible investing terribly disappointing.

Essentially, in a field brimming with new opportunities, the panel talked about the oldest (and arguably) least impactful of strategies: screening public equities. They did promise to talk about other mission investment strategies, but never really got there. In short, the opportunity to educate and encourage more foundations to innovate and look for best of class strategies to employ their assets for financial return as well as social benefit was lost. Maybe most baffling to me is that some of the best known and most successful of MRI practitioners and MRI service providers are in the house, but those voices were not heard. What gives?

COF did redeem itself, however, with the afternoon panel on community investment, “Taking Responsibility for Your Community.” A stellar panel of private as well as community foundations talked about using mission related investment strategies to get critically needed infrastructure development projects done. Innovative, yet practical. Complex deals made simple and replicable in other communities. And yes, inspiring. So I got my MRI education fix–I hope others did too.

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(This is a guest post from Sara Melillo, Program officer, McCormick Tribune Foundation, who is covering the Council on Foundations Conference for Tactical Philanthropy)

By Sara Melillo

In the non-profit and philanthropic sectors, failure is not an option, yet it’s expected in the corporate and technology sectors. At least that was one provocative assertion of Brian Trelstad of the Acumen Fund, one of the panelists for the Social Entrepreneurship: New Approaches to Changing the World.

The packed social entrepreneurship session covered a lot of ground, but the ‘To fail or not to fail’ question struck me as most relevant to those working at traditional private foundations.

Social entrepreneurship investors and grantmakers seek out people and projects that apply innovative business practices for social change. Like the corporate and tech worlds, these investors take risks and don’t fear failure. Invests can, and are encouraged, to make money. They don’t have to play it safe.

The catch on failure: You need to learn from the flops. So what’s holding back traditional foundations from investing in so-called risky projects? A bunch of reasons — the risk of embarrassment, being reluctant to change (we’ve always funded X), legal technicalities, etc.

The rise of social entrepreneurship provides us a timely opportunity to re-examine our fear of failure and a number of examples of non-traditional investments that worked. Sure, it’s risky, but that can be outweighed by finding some sustainable projects and strategies we never would have considered.

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(This is a guest post from Jacob Harold, Program Officer at The William and Flora Hewlett Foundation, who is covering the Council on Foundations Conference for Tactical Philanthropy)

By Jacob Harold

This morning I spoke on a panel with the unwieldy but accurate title of “Nurturing the Philanthropic Impulse – Donor Advisors and Philanthropic Strategy.” It was hosted by Eric Kessler of Arabella Advisors and moderated by the psychologist and philanthropic researcher Tom Backer. The panel addressed the complex, growing role in philanthropy of professional advisors—financial advisors, estate attorneys, wealth managers, and accountants. These advisors are often there at the moments when wealthy individuals and families are making philanthropic decisions. They’re uniquely placed to connect donors with good information and resources, but many advisors don’t feel equipped to help their clients get as much philanthropic bang for the buck as possible. (I’ve been trying to speak more plainly, so I won’t say “maximize marginal social impact per dollar” like I kinda want to.)

I’d like to see more advisors not only playing the role of trusted confidant and supporter, but also of philanthropic “concierge”—linking donors to resources that are available in the nonprofit sector that could help them make good decisions: Guidestar and DonorEdge provide data about nonprofits; magazines like Stanford Social Innovation Review share new research and serve as a platform for debate; Social Venture Partners provides peer-based learning; and Rockefeller Philanthropy Advisors offers high-level strategic advisory services. Dozens of other organizations like these provide useful services to donors. But how is a professional advisor to make sense of these scattered, evolving resources? As a sector, we need to take these cottage industries and turn them into a coherent system of data and knowledge that advisors can easily tap into. A good concierge doesn’t need to be a cook, sommelier, or tour guide—but they do need to know where the great restaurants and museums are.

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