Code, Camera, Action

Nathaniel Whittemore on funding the causes (and friends) you know --

Today’s young people have grown up with access to more news - and more connectivity to direct on the ground sources - than ever before. We’re hungry to actually do, and less and less content to sit on the sidelines (or if you will, Morgan Stanley summer internships). When today’s young people are surveying their options for summers, and the options are getting research grants or volunteer positions with international nonprofits doing compelling work, or wearing a suit to get some guy coffee and learning how to jockey Excel spreadsheets, guess what they’re choosing?

The implication is not that every one of those people that has that sort of formative experience is going to start or join a social venture. But almost every young person today knows more people with their own nonprofit organizations than people a few years older. It’s just the norm.

If and as that trend continues, it’s going to make more and more sense to just support the work of people you know. That sort of giving has not only the personal return on investment discussed above, but a social return on investment that is about investing in the good work of your friends. And that’s even before you get to the fact that many will be more likely to trust the “outsourcing” of the social return on investment to people they know and in whom they have confidence.

via socialentrepreneurship.change.org

Geoff Livingston responds to Kristin Ivie and my previous posts about new nonprofits. 

Entrepreneurs look at things, see how they can be improved, tear down models, and rebuild them. So when we’ve experienced enormous successes in the for-profit world and then turn our eyes to higher causes, it’s only natural to think the same approach will work.

Granted there is ego at play, but are you going to tell someone who successfully sold a business or took a company public, that they can’t win again in a different sector? Good luck with that one!

via geofflivingston.com

For Geoff, an entrepreneur and blogger, advice to slow down is like reigning in the horses as they dash for the barn. Good luck with that one. And he's right, of course. 

Having seen a few horses in this business, though, I was hoping to point out how the economics of nonprofits can work against that entrepreneurial spirit. 

As a nonprofit, it can be a challenge to know if you're making progress, much less to best organize around it. 

Can you imagine this conversation taking place in the private sector?

Nonprofit entrepreneur: I want to take a fundraising job for a nonprofit that's really changing the world. What do you think?

Mentor: Be careful not to get pigeonholed. "Once a fundraiser, always a fundraiser." 

Maybe Sasha's example here is just isolated old-school thinking. I hope so. And maybe, as Geoff says, entrepreneurial spirit and gutsy social enterprise will be what shakes up slower organizations.

But I can think of a couple of things that could help speed that day for more entrepreneurs --

• Competitions with incubation or startup coaching (a la Y Combinator)
• Metrics for success. Government provides some of these statistics, larger NPOs and NGOs provide others
• Market valuation for social enterprises. For another post, but in our attention economy, this may be possible.

What else should be on this list? 

Who wants to help?

Matt Flannery, co-founder of Kiva, looks forward from the organization's fourth birthday --

What we will see, in the years to come, is that we are just at a beginning of a larger trend towards more connected experiences. Kiva is just one organization that will be part of a much larger shift. It is a shift towards personalization and partnership relationships of mutual dignity. Looking back, the $100M will seem like a small drop. The potential for big change from the aggregate tiny actions of many is now more enormous than ever.

via kiva.org

"A larger trend towards more connected experiences" -- here's to the dignity that affords all of us.

Paul Lamb writes:

So how we can innovate the sector as a whole so any nonprofit can do better regardless of the prevailing economic winds?

One radical idea is to adjust the nonprofit model and begin to let communities engage directly with causes and people in need.

Taking a page from the playbook of peer-to-peer services such as eBay, charity "buyers" and "sellers" could engage directly without the need for a middleman.

Instead of giving money to the United Way to support food banks, why not give the money directly to the hungry?

via csmonitor.com

Kristin, my colleague at the Case Foundation, has some good advice for folks thinking of starting their own nonprofit: think twice. http://www.socialcitizens.org/blog/start-nonprofit

The post goes on to list some ways of partnering with existing orgs -- to do the good works without having to do your own 501(c)3. With one nonprofit for every 300 Americans, that's probably a good idea.

But I wonder what it is about nonprofit thinking that makes successful, businesslike individuals forget their horse sense. Nonprofiteers seem enamored by the dream -- all the people they will help, how they will at last be able to give back. Here's one example I've retold: Helping Ghana Without Reinventing the Wheel.

The reality is, as usual, more complicated. Nonprofits are business in every sense save the profits. And removing profits -- and the resources that come with them -- complicates things indeed. I wish for everyone thinking of starting a nonprofit some clear-eyed market analysis.

1. Not-for-profit doesn't remove competition

You will face competition for donations. You may face competition among other providers of similar services. You will certainly face competition for attention. How is what you're doing unique? What about your approach or beneficiaries will help you reach donors? Or, as Kristin suggests, might you be better to contribute to, or partner with related organizations?

2. Robin Hood is romantic, but it's easier to sell to people who need you

Most nonprofits ask for donations from the rich to provide services for somebody else. In this sense, help is a luxury good. "Give us money to solve a problem that other people have" isn't the strongest of appeals. How will you find people who share your priorities for social good? (Social media can help.) How will talk about your cause to help galvanize those who don't?

Like Robin Hood, you may find yourself bridging the worlds of your customers who use your services and your funders. Are you ready to translate?

3. Metrics for your success may be hard to come by

In the for-profit world, your accountant helps you know you've failed. Not so with nonprofits. There, your long-term success depends on slipperier metrics. Did literacy levels increase among at-risk kids in urban Houston? How many meals did you serve? And how do these short-term metrics connect with longer-value impact?

4. Solve problems, don't just create organizations

Folks like Dan Pallotta are concerned that nonprofits lack ambition for the big stuff. 

In the for-profit world, it takes a product that's 10 times better than the competition to persuade folks to give it a try. How can you be 10 times better at targeting potential donors? Or 10 times better at addressing your issue?

At the end of the day, is that ambitious enough?

Nearly 100 new nonprofits are created in the U.S. every day about 35,000 a year most of them doing the same things as existing organizations wrestling with the same social problems. Over 90% are very small with less than half a million dollars in annual revenues. In his recent article in the Stanford Social Innovation Review, Mark Kramer wrote that, because of fragmentation, redundancy, and the plethora of small organizations "there is little reason to assume that [nonprofits] have the ability to solve society's large-scale problems." I would argue that it is precisely because we aren't committing ourselves to solving society's large-scale problems that we have fragmentation and redundancy.

via harvardbusiness.org