Category Archives: Open Source Philanthropy

Google, Information & Philanthropy

February 7, 2008 – 9:25 am

Google.com lets users create custom search engines. Here’s an interesting example of how Google technology can be used to create more efficient information distribution in philanthropy.

Developed by E-Democracy.org, the custom search tool is described this way by the creator:

To assist E-Democracy.Org’s grant prospecting efforts I put together a little (big actually) Google Custom Search covering foundations, some government funding sites, and sites with fund raising advice for non-profits.

You can use E-Democracy’s custom search engine here and create your own here.

(hat tip: Lucy Bernholz)

By Sean Stannard-Stockton | Also posted in Philanthropic Capital Markets, Philanthropic Technology, Philanthropy, Social Media, nptech | Comments (0)

Breaking Frames in Philanthropy

January 28, 2008 – 10:12 am

Humans have a remarkable ability to categorize information and then quickly compare new data to prior experiences. This allows us to absorbed massive amounts of new data quickly in ways that computers are still unable to do. For instance if I show you a picture of a dog that you’ve never seen before, even a photo that is blurry or otherwise difficult to analyze, you will immediately recognize it as a dog based on your prior experiences.

This can be a trap.

This remarkable skill can prevent humans from recognizing the differences in things. We are often startled when individual do not stick closely to the broad categories in which we’ve stuck them. That’s why we get confused by democrats that are for an aggressive military, physicists who are in rock bands, or surfers who read the Economist.

I’ve been talking about efficient markets in philanthropy and I think that some people are making a number of assumptions that are not valid, although understandable, about my broader message. I’m going to quote from a number of recent comments and post my response:

Phil Cubeta:

Do you think, Sean, at all about civics, citizenship, about the nonprofit sector as “soul making,” or about how we as a people learn the difficult art of democracy?

I see nothing about efficient markets in philanthropy that is at odds with civic engagement. Efficient markets in philanthropy is about widely distributed, useful information. A more efficient market would allow for more philanthropic capital to flow to its best use as well as allow volunteers to find high engagement volunteer opportunities where they could truly “learn the difficult art of democracy” rather than stuff envelopes. Information efficiency and hyper-capitalism are entirely different ideas.

Young Staffer:

When did it become a choice for the sector between most efficiently solving problems and nurturing the higher callings of our community?…

This discussion seems to me to pit two histories of the independent sector against each other – the early 20th century philanthropy of Carnegie and Rockefeller and Ford against the 19th century of de Toqueville’s associations. We shouldn’t (nor do I think we can) do away with either legacy. Both are part of the nonprofit sector and both color it. The paradox is that they have contradictory aims. The first, the one which would benefit from an efficient market, see its own destruction as its ultimate end. The second, which rests on civic engagement, sees its own expansion as almost endlessly beneficial.

I see no contradiction between efficiently solving problems and nurturing the higher callings of our community. I think that is a false choice.

I also reject the comparison of efficient markets to the efficiency sought by early 20th century philanthropists. Efficiency as defined in the industrial age (highest number of widgets at lowest possible cost) is not the same as efficient information that allows people to direct their resources in ways that promote the most good (however each person defines “good”). The first type of efficiency is generally concerned with quantity while the second kind is more multidimensional and takes into account quality as well as value judgments.

Michael Moody:

The qualitative folks need to become comfortable with the numbers (they really have no choice in the nonprofit world today, frankly–and this is probably a good thing in the end, though there are growing pains!). And the metrics folks need to be comfortable with retaining some of those other forms of valuation (e.g., people recommending trusted nonprofits to each other, people giving because they are committed to a mission) that have been around, for good reason, for a long, long time.

Yes! Efficient markets certainly do not value quantitative information over qualitative. I’ve consistently rejected quantitative measures such as overhead expense ratios. Great Nonprofits (people recommending trusted nonprofits to each other) is certainly the type of tool that will make philanthropic markets more efficient.

All that efficient markets in philanthropy imply is that the resources of donors (money, time, knowledge, etc) are allocated to nonprofits so that the most “good” is created (with good being defined by individual donors following their own hearts). It would be The World We Want, with the emphasis on “we”. In a philanthropy with information efficiency, a donor could sit in an office crunching spreadsheets or head out in the wilderness to cut trails. Information efficiency empowers people to make informed decisions about the best way to further their values and beliefs; it does not dictate what sorts of actions are “best”. Only each individual can make that decision for themselves.

By Sean Stannard-Stockton | Also posted in Effective Giving, New Philanthropy, Philanthropic Capital Markets, Philanthropy | Comments (5)

Information Sharing in Philanthropy

January 23, 2008 – 11:45 am

I wrote a post a while ago called Paul Brest Needs a Blog (Paul is the head of the Hewlett Foundation). I’ve been an advocate for more people in philanthropy to start blogging in general. In the above mentioned post I wrote:

So why should foundations blog? It seems to me that the imperative is not for them to embrace technology so much as it is for foundations to join and begin to drive the online philanthropy conversation. [But] it is the two-way flow of information that blogs encourage that is important, not blogs themselves.

Even so I’ve noted recently that some people feel that I’ve pushed blogging rather than information sharing. As the conversation we’re all having unfolds I think it is important to take a step back and make sure we haven’t missed the forest for the trees. I wish I had expressed my thoughts with more clarity.
When Phil Cubeta recently asked why nonprofits should blog, astute reader Michele Moon asked:

I’m not entirely sure why it’s blogging, in particular, that’s the focus of discussion, especially because it’s now considered a little bit old-hat, Web 1.5. What is it about the format that makes it so essential to transparency and its tyrant? Is it actually blogging you want to see - personal, real-time updates and editorials, followed (if you’re lucky) by people who read, comment, and sometimes stick around to converse?… Why should it be blogging that we aim to do, or is that shorthand for more complicated online interactivity?

I’m guilty of using “blogging” as short hand for information sharing. I’ll stop making that mistake.

When economists speak about efficient markets they are talking about a situation where money flows to the organizations that can put it to the best use. Widely available, robust information is a critical factor for a functioning efficient market. Recently, in a conversation with Phil Buchanan and other readers on this issue I wrote the following (you can find the full thread here. The Chronicle of Philanthropy recently highlighted the conversation):

In an efficient market, investing is a zero sum game. Maximum returns are generated globally so the only question is matching an investor’s risk/return preferences. In inefficient markets, higher returns accrue to more “effective/smarter” investors. In a public benefit market, since all returns accrue to everyone, investors should desire an efficient market within which they could align their social investments with their personal values/goals.

The philanthropic capital markets are highly inefficient. Far more inefficient than any for-profit marketplace.

Therefore, it seems to me that making the philanthropic capital markets more efficient should be the number one priority of large funders who desire to be effective…

I’m not arguing that the public will make better decisions than the “experts”. I’m saying that efficient markets will produce better outcomes than inefficient markets. In the for-profit world, inefficient markets are great for “expert” investors because they can exploit superior information to generate outperformance of investment returns. But these inefficient markets reduce the total returns in the market by preventing capital from flowing to the best performing investments.

What I’m saying is that unlike in the for-profit market, “expert” philanthropist enjoy no advantage from superior information. The returns they generate accrue to the public, and so no “outperformance” is possible. Instead, they should be interested in the total market functioning at a higher level, since that is the only way to increase the social return on investment that accrues to everyone.

This is the challenge we face as a field. How can we ensure that the $300 billion that is given to charity each year is flowing to the organizations that can put the money to its best use? The key will be our ability to supply market participants with widely available, robust information. Blogs are one tool in this work. There are many others.

By Sean Stannard-Stockton | Also posted in Cross-Disciplinary Conversations, Effective Giving, Evaluation, Foundations, Giving Blogs, Grantmaking, Impact Measurement, New Philanthropy, Philanthropic Capital Markets, Philanthropic Technology, Philanthropy, Transparency | Comments (18)

Beyond Hacking Philanthropy

November 23, 2007 – 11:25 am

This entry to the One Post Challenge comes from Kevin Jones. Kevin is a principal at Good Capital and blogs at xchangexchange.

By Kevin Jones

There are events like Hacking philanthropy, where people try to come up with new ways to crack the code of giving. There are events like Josh Becker’s zero tradeoff conference where a new group of funds say you can invest to do good at no discount to return. Both approaches are attracting a lot of people and attention. And I think they’re great, but I also think something deeper needs to happen.

If you are hacking philanthropy, it’s like, in technology terms, that you are just hacking at the interface level; you are buying into the set of assumptions, the implicit myths that the system offers you. The true power of the open source Linux system is that it opens up the root level, where you can decide which interface, which set of assumptions you buy, or where you can even create a new set. That’s where I want to play. At the root, superuser level, where you decide who you are, look at your resources and decide what impact you want to make in the world, without the hard and fast categories of giving and investing, two pocket thinking that you’ve had handed down to you.

I want to hack at the root level, not just hack philanthropy or investing. I want to reconsider the basic equation. What impact do I want to make in the world? How much do I need, how much can I share for the sake of all?

By Sean Stannard-Stockton | Also posted in Cross-Disciplinary Conversations, New Philanthropy, One Post Challenge, Philanthropy, nptech | Comments (2)

MIT Philanthropy Research & SeaChange Partners

September 26, 2007 – 8:37 am

It seems like everyone is talking about philanthropy these days. Before Freakonomics was published, no one would have guessed that economic theory could generate a series of best sellers. I wonder when the Tipping Point or Freakonomics of philanthropy will hit the scene?

Today we have Ed Boyden, a professor at MIT speculating on philanthropic capital markets:

One possibility is that if there were an open market for philanthropy, which would connect dollars with ideas, then you might be able to find researchers working on the problems you care most about, evaluate the investigators and their approaches, and empower them directly with funding. As resources pool, naturally, the most widespread and severe problems would receive the largest sums of money, providing a sort of free market for research philanthropy.

About 60 million Americans currently fit the criteria for obesity, which puts them at risk for diabetes (and dozens of other medical conditions). If 5 percent of these people desired to pool their resources to study ways of tackling metabolic impairments, and thereby improve health, and each contributed just $1.25 a month to researchers who focus exactly on the problems of most pressing interest, that would be $45 million a year. While that may not seem like much, note that the American Diabetes Association gave out about the same amount–$46.4 million–in research dollars in 2006.

You can read the whole thing here.

Ed is talking about a system similar to the public for-profit markets. But for-profit markets also depend on a system of private equity investors. Cheryl Dahle suggested after her interview that foundations should be engaging in private equity-like behavior. Now we have Goldman Sach’s funded SeaChange Capital Partners trying to do just that. From the NY Times:

An organization founded by two former Goldman Sachs partners is using Wall Street methods to help charities raise money to finance expansion.

“Our goal,” said Charles T. Harris III, “is to create a nationwide donor network of wealthy individuals and family foundations that we can mobilize with other existing sources of funds to provide growth capital for entrepreneurial organizations.”

Mr. Harris and Robert K. Steel formed SeaChange Capital Partners, which sounds like a hedge fund but is a nonprofit financing firm.

You can read the whole thing here.

By Sean Stannard-Stockton | Also posted in Cross-Disciplinary Conversations, Media, New Philanthropy, Philanthropy | Comments (0)

Peace Primary & Nonprofit Research

September 14, 2007 – 9:18 am

The Ploughshares Fund is a public grantmaking foundation that focuses on “building a safer, more peaceful world”. To do that they make grants to organizations that they determine are the “smartest people with the best ideas”. While identifying high impact nonprofits can be difficult for individual donors, the Ploughshares Fund has expertise in their focus area. If you share their mission, you could decide to donate to them and let them make the decision of which organizations to fund.

Right now, the Ploughshares Fund is running a project they call Peace Primary. The project involves 12 organizations that Ploughshares has identified as having strong records of high impact activity. Visitors to the website are invited to “vote” for one or more of the “candidates” by making a donation. The organization with the most votes (most dollars raised) will win a $100,000 grant from Ploughshares.

I think this is a great example of how grantmakers can involve the community, but even more importantly, how the expertise of foundations can be shares with the public. In a world where measuring and comparing nonprofits is extremely difficult for individual donors, gaining access to recommendations from a trusted expert is invaluable.

As much as I like Ploughshares’ initiative, I’d like to see them go one step further. Right now, information explaining why each of the chosen candidate organizations are effective and achieve high impact is scanty at best. While I assume that Ploughshares is correct in their evaluation of the field, as an individual donor I would be far more interested in the project if Ploughshares explained their rational for each group. Releasing their entire store of research on each nonprofit would be ideal, even just a couple paragraphs explaining why each one is so great would be a big step forward.

There’s been a fair amount of talk this year about community involvement by private foundations. But while letting the public help foundations decide which nonprofits to fund is interesting, I’m more interested in information flowing the other way. As it stands now, foundations have most of the expertise on identifying the best nonprofits, but only 12% of the philanthropic dollars (they are responsible for only 12.4% of annual charitable giving). Individual donors have almost no expertise in nonprofit evaluation, yet they make over 75% of the annual charitable gifts in the US.

I think that Ploughshares is doing something important by sharing a list of high impact nonprofits in their field of interest. I hope we see a lot more projects like this in the coming years.

By Sean Stannard-Stockton | Also posted in Effective Giving, Foundations, New Philanthropy, Philanthropy, Transparency | Comments (0)

Philanthropy Conversation Goes Digital

August 17, 2007 – 9:49 am

Here’s the story so far…

In the March 31 issue of the Chronicle of Philanthropy, Robert Egger authored the article, “Charities Must Challenge Politicians” which suggested that nonprofits must get more involved in politics.

On June 4, a live online chat session was held between Egger and the public.

The June 28 Chronicle of Philanthropy issue included a rebuttal by Pablo Eisenberg, which encouraged charities to remain nonpolitical.

On August 9, Egger and Eisenberg met at the Hudson Institute’s Bradley Center for Philanthropy and Civic Renewal for a live debate. A full podcast of the debate is available here and the transcript can be found here.

On Aug 10, Egger posted a video on his blog calling the debate “crazy” “cool”.

On Aug 13, The Chronicle of Philanthropy posted the audio, transcript, and links to the original articles and said, “We hope this conversation will continue. Please share your thoughts on the issues raised at this session by clicking on the comment box below.”

On Aug 15, Hudson uploads highlight clips to YouTube:

Robert Egger on…
… ending the “charity trap” and the laws that maintain it
… more problems with charity, the Nonprofit Congress as a way to overcome them through unity and political action
.. getting a nonprofit page in the business section of newspapers across the country

Pablo Eisenberg on…
… the importance of “nonprofitness,” leadership
… nonprofits should first challenge foundations, corporate donors, not get into politics
… the need for more young people in the sector, and opportunities for them to be politically active.

All of this is great. But there’s a problem. How many people are going to listen to a 2-hour podcast? I’d like to think everyone who cares about these issues will, but the fact is that people live busy lives. But there is a solution. With my prompting, Hudson has posted the entire video record of the event (Part 1 and Part 2). So here’s my call to the nptech community and/or anyone with some chops in the social media arena. You’ve got the full raw material of the video. Who wants to edit this thing down to a video that lots of people will take the time to watch? If you want to see more information coming out of “philanthropy establishment”, then you’ve got to actually use it once you get it.

You can and your thoughts on whether nonprofits should be involved with politics by commenting on the Chronicle of Philanthropy forum or by commenting on this post.

By Sean Stannard-Stockton | Also posted in Cross-Disciplinary Conversations, New Philanthropy, Philanthropic Technology, Philanthropy, Transparency, nptech | Comments (2)

The Power of Community Foundations

August 13, 2007 – 8:18 am

Lucy Bernholz, wrote an excellent article that was published in the San Francisco Chronicle this weekend:

…And then there’s the extensive information that community foundations gather. Every day, nonprofit organizations and public agencies share proposed solutions with these foundations. Every day, generous individuals approach community foundations for help finding ways to meet their philanthropic goals.

These foundations are, or could be, active and effective clearinghouses for ideas. They could become partners with local news organizations in covering the ups, downs, news and local interest angles of life in the region. They could invite public officials and local residents to brainstorm about public issues, partner with community media to gather neighborhood level input, and then host opportunities for local nonprofits to interact to turn those ideas into action.

They can also provide invaluable local expertise to national funders — public, private and corporate — as brains on the ground for issues that stretch across our neighborhoods, regions and nation, from health care and energy to transportation and literacy. They are uniquely positioned to spot trends that will shape our communities and bring together people who can use that information for the good…

…Here are four steps to better community foundations:

  • Think across sectors. Poor air quality or failing schools affect us all. Who has the solutions? Convene the public sector, private companies, individuals and nonprofits to nurture solutions.
  • Invest locally. Foundations manage billion-dollar investment portfolios to make grants in the millions. Use those billion-dollar endowments locally, as seed capital for clean tech or community loan funds, or to invest in critical community resources.
  • Get involved. There are lots of options for people to give and for organizations to raise funds. Working with a local community foundation is more than simply a financial choice — it is itself an investment in the region’s future.
  • Take a stand. Politicians have election cycles, companies have bottom lines. Foundations are here for good. Use the platform of long-range thinking and permanent commitment to take stands on important community issues.

Lucy really understands philanthropy and frankly she knows the history and inner workings of the sector better than anyone blogging today.

Lucy’s call for community foundations to act as a clearinghouse for ideas got me thinking about Paul Brest’s (president of the William and Flora Hewlett Foundation) recent call for an “online marketplace of information” for philanthropists. Lucy and Paul may not be engaging in wishful thinking. Community Foundations of America has recently relaunched as GivingNet (with major input from PhilanthroMedia’s Susan Herr).

Can GivingNet serve as an information clearinghouse? If not them, who?

By Sean Stannard-Stockton | Also posted in Effective Giving, Foundations, New Philanthropy, Philanthropy | Comments (2)

Tactical Philanthropy Podcast: Daniel-Ben Horin

May 25, 2007 – 8:33 am

My guest today is Daniel Ben-Horin. Daniel is founder and president of CompuMentor and TechSoup, who are behind the NetSquared Conference. Daniel discusses the history of CompuMentor, how technology is transforming nonprofits, explains the vision behind NetSquared, and reflects on the use of “wisdom of crowd” techniques in philanthropy.

Expand this post using the link below to read the transcript.

Read More »

By Sean Stannard-Stockton | Also posted in New Philanthropy, Philanthropic Technology, Philanthropy, Venture Philanthropy, n2y2, nptech, podcast | Comments (0)

Citizen-Centered Civic Participation

May 17, 2007 – 7:57 am

The Case Foundation is engaging in an interesting experiment. They want you to help them decide where to give their money. (hat tip to Beth Kanter):

Dear Friends:

The Case Foundation is looking for external reviewers to assist with the first phase of a pilot grantmaking program that encourages citizen-centered civic participation. Given your experience and relationships, we thought you might want to apply; encourage your friends, colleagues or constituents to apply; or forward the announcement to others who might be interested.

First, a bit of background. Through this new grant program, the Foundation seeks to identify, support, and lift up some of the most exciting citizen-centered efforts that are bubbling up across the country. But, what also makes this program interesting is that the Foundation will not only be supporting citizen-centered efforts, but will be attempting to walk the talk of citizen-centered practice itself by involving the public in virtually every aspect of the process from creating guidelines to vetting proposals to making grant decisions.

The individuals the Foundation is now recruiting (and will commission) to serve as external reviewers will be participating in the first part of this process: Reviewing and assessing the initial "letters of interest" from hundreds of organizations and individuals across the country. More details about the position are attached.

This will not only be a fun and interesting opportunity, but it will give participants the chance to participate in one of the first efforts by a national foundation to "do philanthropy" in a way that is, hopefully, more transparent, interactive, and responsive.

Interested applicants should first read the attached job description and are strongly encouraged to review the Foundation’s paper, Citizens at the Center: A New Approach to Civic Engagement. An executive summary of the paper is also included in the job description (Word document).

The deadline for applications is Wednesday, May 23rd.

Interested individuals should send their resume or curriculum vitae and a brief statement (50-75 words or less, please) on why you want to be involved in this review process by Wednesday, May 23 to:

The Case Foundation
Attention: Kristen Cambell
kristenc@casefoundation.org

Behind all of this is a paper written by Cynthia Gibson and commissioned by The Case Foundation:

Getting citizens more involved in the civic life and health of their communities must begin with citizens themselves, according to Citizens at the Center: A New Approach to Civic Engagement, written by Dr. Cynthia Gibson and commissioned by the Case Foundation. Based on interviews with researchers and experts in service/civic engagement, politics, and marketing, the paper offers specific recommendations for giving citizens the tools they need to identify problems and develop solutions — and warns against top-down solutions that require people to "plug into" existing programs or campaigns.

To receive a printed copy, sign up here.

Is the paper worth a read? Note a couple of the people who submitted comments to The Case Foundation post about the paper:

  • Jayne Cravens, Coyote Communications
  • Ami Dar, Idealist.org
  • Leslie Lenkowsky, Center on Philanthropy at Indiana University
  • Judy Woodruff, "NewsHour"
  • Daniel Ben-Horin, CompuMentor

You can read the full description and all the comments here.

By Sean Stannard-Stockton | Also posted in Foundations, New Philanthropy, Philanthropy | Comments (2)

Robert Wood Johnson Foundation: Disruptive Innovations

May 15, 2007 – 8:24 am

From the Robert Wood Johnson Foundation:

$5 Million Available to Support Ideas That Transform Markets and Empower Consumers

Submit your idea today!

"Disruptive Innovations in Health and Health Care" is an open source competition to identify ways in which the health and health care marketplace can offer services, tools and choices that consumers want-but are currently out of reach because of cost, complexity or because the right idea hasn’t come along.

We are looking for entrepreneurs both within and outside of the health care field with ideas for new products, services, technologies, business models-or some combination thereof-that enable consumers to manage health and receive care in ways that are more affordable, accessible, simple and convenient.

Examples: Glucose monitors that provide diabetics with the convenience of blood glucose readings in seconds from the comfort of their own home. Walk-in health clinics in retail stores that enable patients to quickly see skilled nurse practitioners who can treat common conditions at lower costs than typical doctor visits.

Enter By: Jul 18, 2007 | Voting Begins: Aug 15, 2007
Winners Announced: Aug 30, 2007

How It Works: Twelve competition finalists will be selected by a panel of judges. You then vote on three winners, who will each receive a $5,000 cash prize from Changemakers. In addition, the Robert Wood Johnson Foundation’s (RWJF) Pioneer Portfolio will review competition entries and may award up to $5 million to support projects that show potential for significant impact!

GET INVOLVED! Submit your idea for "Disruptive Innovations in Health and Health Care" today.

Join the discussion, tell a friend, share your thoughts.

Unlike NetSquared, which let the crowd pick the finalists, RWJF will let experts pick the finalists and then let “you” pick the winners. Navigating the conflicting powers of the Wisdom of Crowds and the Madness of Crowds is tricky business. But I think that those who are able to figure it out will indeed discover disruptive innovations.

By Sean Stannard-Stockton | Also posted in Foundations, New Philanthropy, Philanthropy | Comments (1)