The Mountaintop

I'm a person who thinks in the long-term. I'm not much for process or details, but I think about the bigger picture, the end-game. I like ideas and notions more than I like thinking about how to put those thoughts effectively into action. At one point in my life, I dismissed policy and practice as secondary to the concept they are trying to create, but now I'm beginning to realize how important those details are. If you can't make an idea work in the reality of a situation, it doesn't do anyone any good.

But I still tend to think of things in the bigger picture. Especially when considering nonprofit and social change work, I always ask myself, where is this going? What are the eventual goals of this work? Will there really be a time where there is nothing more to solve and don't have to worry about all of the problems we face now?

I'd like to say yes, but I'm not sure if that's based in reality. Last week, I wrote a post about the role of philanthropy in the long-term, and Sean from Tactical Philanthropy commented:

[W]hile I appreciate your goal of "putting yourself out of business", the underlying assumption is that if we work hard enough we can create a utopia where attempts to increase social welfare will not be needed.

That ain't gonna happen.

Sometimes, I agree with him. The intellectual side of me knows that there is no way we as a species can reach a point were we have no problems and there is no suffering. The law of unintended consequences shows that no matter how hard we try to solve all the world's problems, any intervention can spawn new problems where we least expect them.

This intellectual and rational side of me is constantly at odds with the side of me that completely and wholeheartedly agrees with the vision set out by people like Dr. Martin Luther King. He saw a world that was free of struggle and full of love and peace. In his final public speech, "I Have Been to the Mountaintop," he said that he didn't worry anymore, because he knew that one day, somehow, we'd get to that promised land. I'm not one to disagree with a visionary like Dr. King, so I don't know how to reconcile these two opposing thoughts in my mind.

I think the best that we, as those working to put Dr. King's vision into practice, can do is to create a world that can adapt and solve problems as quickly as they arise. As I said in my last post, that is not what the nonprofit sector does right now. There needs to be many changes to how resources are allocated before we can get to that point.

This tension between the desire to build a perfect future and the reality that we can never foresee all the problems we will face is a constant struggle for me. But I cannot keep worrying about the future and what it will look like. I need to trust the words of Dr. King that he saw the future promised to us, and whatever it looks like, we will get there. I can only do my small part to build on the legacy left by him. He was not worried on that night before he was assassinated, and so I too don't worry.

To celebrate the day honoring his memory, a clip from his "I Have Been to the Mountaintop" speech:

                                                                                                   
Disclaimer: The postings on this site are my own and do not represent the positions, strategies or opinions of Venture Philanthropy Partners

Shameless Self Promotion: January Edition

Another month, another issue of VPPNews. Check it out and let me know what you think.

Highlights:

• VPP President Carol Thompson Cole's column on redefining "scale." I find this a fascinating take on a concept that is thrown around a lot in the nonprofit sector. She expands the definition to consider not just the number of people an organization serves, but its overall impact on a community or a sector. 
• A look at the innovative corporate philanthropy strategy of Capital One.
• A review of the first year of VPP's investment partnership with the workforce development program, Year Up.

                                                                                                   
Disclaimer: The postings on this site are my own and do not represent the positions, strategies or opinions of Venture Philanthropy Partners

Turning the Dials on an Outdated System

I think one of the hardest things for me to deal with in my professional life is that I am making a living off of the misfortune of others. Without the inequalities that exist in our society, the organization I work for would not have a purpose, and I would not have a job. I have a comparatively privileged lifestyle to those I am trying to help and I live comfortably while they do not. If their problems were solved, or didn't exist in the first place, I would not be able to do what I love, and get paid for it too.

Last week, Lenore Hanisch of the Quixote Foundation wrote a guest blog post on Tactical Philanthropy on its recent decision to spend down all of its endowment by 2017, which resonated with my struggle to be comfortable with my work. Hanisch commented on how the decision to spend all of the foundation's reserves will put her into some personally difficult situations:

Erik [her husband whose father started the foundation] and I have always been clear in our belief that the foundation and its assets exist for the purpose of progressive work—not to give us purpose. This field can be seductive: when you’re associated with a foundation you’re suddenly always funny and interesting, with people eager to hear your opinions. When the money is gone I’ll not only need a new job, I’ll also be left out of quite a few parties and someday, someone might even admit they don’t like me. In other words, spending everything puts us in a fairly normal situation as far as our jobs are concerned.

For those that work in the social sector, our goal should always to put ourselves out of a job, otherwise, we are just making money off of poor people. As I learn more about the field, I'm realizing that nonprofit funding is very donor-driven and subject to the whims of major donors and foundations. This creates a capital stream that is fragmented and variable, which doesn't help encourage organizations to focus on long-term solutions to society's problems. Instead, we get caught in a cycle of charity that aims to fill the needs of the underserved, rather than creating large shifts in systems and values. I benefit from this constant cycle, as I will be constantly employed.

I think the only way I can truly feel good about working the social sector (and, by extension, the whole social sector itself), is to create a shift away from donor-driven cycles of charity. These changes are happening all around with the rise of social entrepreneurship and venture philanthropy, but I feel like it is not enough. It is important for foundations to spend down their endowments and for organizations to work on accomplishing goals so they are no longer needed, but this is only one piece of what is needed. To make a true shift away from charity to solutions-driven change, we need to reshape the rules of the nonprofit sector.

Lucy Bernholz and Steve Goldberg recently had a fascinating exchange about the place of philanthropy in the long term. While discussing the different innovations going on in the nonprofit world (from those great social entrepreneurs and venture philanthropists), Lucy commented that:

[P]hilanthropy as an industry is "designed" by policies. It is a regulated industry. It is shaped by the rules. And the rules, currently, favor "donor centric, fragmented, etc"... The game itself doesn't change because there are new players - it needs new rules.

All of the changes to nonprofits that are currently going on, Lucy said, are mainly financial innovations, or business model innovations. Thinking about effective management or outcomes measurement for nonprofits is important and can create some lasting change, but those changes are just turning dials on an outdated system that can't respond effectively to the needs of the population. Instead, we should try to think about the assumptions that the nonprofit sector is built on and change those.


Developments on this level are the most exciting to me. The creation of L3C's, the growing market for impact investing, and reforming the tax-deductible donation are areas which seem to have the most potential to create some pretty profound systems-wide change. I think that if we can find a way to blend business and philanthropic capital effectively, we could create a capitalist economy that is based on solving society's problems, rather than creating profit. I'm not sure how to do this, but I'm excited to try to figure it out.


                                                                                                   
Disclaimer: The postings on this site are my own and do not represent the positions, strategies or opinions of Venture Philanthropy Partners

Music to Change the World By

(I am indulging my inner do-gooder in this post. Please don't pay it any attention.)

In college, when some fellow students and I were creating what would become the Social Entrepreneurs of Grinnell, I would always joke about an "SEG Mix" of songs that we could listen to for our occasional pub nights. Because SEG is a microfinance organization, I couldn't come up with many songs that spoke to our mission and work of providing small loans to entrepreneurs around the world. The only two I came up with were Michael Jackson's "Heal the World" and "We Are the World."

But, with a few years of perspective and a broader sense of social justice, I'd thought I'd revisit my goal to find the perfect social change playlist. And as a holiday present to you all, dear readers, I'd like to share what I've come up with.  It is by no means exhaustive, so please let me know what you would add, or remove. Some of them are pretty obvious (like the Michael Jackson tracks), but some are more personal and obscure. Listen to it when you are feeling inspired; listen to it when you are felling discouraged. Music has always helped me celebrate the good parts in my life and work through the hard times, and I hope these songs can do the same.

You can listen to the playlist on Grooveshark here. 

Here's the list of songs, in no particular order:

For What It's Worth, Buffalo Springfield
Chicago, Crosby Stills Nash and Young
If I Had a Hammer, Peter Paul and Mary
Heal The World, Michael Jackson
We are the World, USA for Africa
Man in the Mirror, Michael Jackson
Get By, Talib Kweli
The Message, Grandmaster Flash and the Furious Five
Sound is Vibration, Atmosphere
What's Goin On, Marvin Gaye
Inner City Blues, Marvin Gaye
Ball of Confusion, the Temptations
Lean on Me, Bill Withers
Chimes of Freedom, Bruce Springsteen
The Times They Are A-Changin', Bob Dylan
One Fine Day, David Byrne
If You Want to Sing Out, Cat Stevens
Peace Train, Cat Stevens
Changes IV, Cat Stevens
A Change is Gonna Come, Sam Cooke

And here's some other songs I would have added if Grooveshark would have let me:

Imagine, John Lennon
Give Peace A Chance, John Lennon
We Shall Overcome, the Freedom Singers

What should I add? What should I remove?

                                                                                                   
Disclaimer: The postings on this site are my own and do not represent the positions, strategies or opinions of Venture Philanthropy Partners

The Inefficiency of Cost-Benefit Analysis

I've been learning a lot about social impact measurement and metrics recently, and I've realized something: I don't care about cost-benefit analyses.

My economics professors would be so disappointed in me, I know. But it's true. Out of all the different methods for deciding why to donate to a certain nonprofit, or for why an organization should pursue a particular program, I think a cost-benefit analysis is the least effective way to determine what to do.

I'm not in charge of a large foundation (yet!), so I can't speak much to the different justifications for funding a particular nonprofit, or a particular program. But I do try to be informed and intentional about my charitable donations, so I can (try to) speak to the justifications behind individual donations.

The organization I decided to support is the Village Enterprise Fund. I did not make this decision based on any sort of cost-benefit ratio. That is, I did not look at where my money would, in a strict numbers and results sense, make the most difference, but rather, where I thought the most important work was being done. I care about opportunity access, and I determined that VEF--which provides start-up business grants to entrepreneurs in East Africa--was the most effective organization working on this issue.

If I was strictly looking at a cost-benefit ratio, I would have given to Village Reach, GiveWell's top-rated charity, which has an "excellent" cost-effectiveness rating. GiveWell says that Village Reach, which strengthens health systems infrastructure in rural areas of developing countries, averts a child's death for ever $545 it spends. By contrast, VEF, while still recommended by GiveWell as a charity to donate to, has only a "moderate" cost-effectiveness rating, the lowest of all the top-recommended charities.

I'm not trying to claim that giving to VEF over Village Reach is inherently better because economic empowerment is more important than health infrastructure, but that is a personal conclusion I've made. I've made that decision mostly for emotional reasons that most others probably don't share with me. And because of that decision, I am comfortable knowing that my money is not going as far as it could if I gave it to another organization.

I am very uncomfortable saying that one problem is more important to fix than another, and I don't think cost-effectiveness measurements claiming that one program is more cost-effective than other changes my opinion about that. It does get tricky to support this position when I consider that we have limited resources, and we want to maximize the most good with what we have, but I am comfortable living with that conflict, for now.

I think the reason I am drawn to the nonprofit sector is because a nonprofit's bottom line is not based on a cost ratio, but on its mission. All problems need solutions, no matter how much money it takes. Improving the lives of the poor in the US is as important as improving the lives of the poor abroad, it just takes different resources and different solutions. Because nonprofit work is about more than money, looking at a monetary bottom-line to determine where we should contribute our own resources will always miss out on something. And missing something is always inefficient.

                                                                                                   
Disclaimer: The postings on this site are my own and do not represent the positions, strategies or opinions of Venture Philanthropy Partners

Shameless Self Promotion: December Edition

It's that time of month again! VPPNews came out today. Check it out and let me know what you think.

Highlights:

• VPP Chairman Mario Morino's reflections on the last ten years of VPP's work
• A profile of one of our investors, Jack Davies

                                                                                                   
Disclaimer: The postings on this site are my own and do not represent the positions, strategies or opinions of Venture Philanthropy Partners

Politics and the Nonprofit Language

"As soon as certain topics are raised, the concrete melts into the abstract and no one seems able to think of turns of speech that are not hackneyed: prose consists less and less of words chosen for the sake of their meaning, and more and more of phrases tacked together like the sections of a prefabricated henhouse."

- George Orwell, "Politics and the English language," 1946

I think it's widely accepted in the nonprofit field that there is no common set of terms to describe the work we are doing. I recently read Melinda Tuan's "Measuring and/or Estimating Social Value Creation," about the different ways to measure social impact, which comes with a helpful glossary of terms at the end. She says that she created this glossary because: "The organizations we profiled in this paper often use different words to describe the same thing or use the same word to describe different things. This can be very confusing and obfuscate the true methodologies or results behind the various approaches."

I came up with my own Glossary of Useful Terms a few months ago, but these were much less helpful than Tuan's, by design. Defining things in the most abstract sense (Social Return on Investment: Helping people with your money; Social Enterprise: The thing that you do when you do things) was supposed to be humorous, but also tried to get the point across that the words that we use when describing what we are doing have no real meaning outside of the contexts they are used in.

The use of language has been important to me since I read George Orwell's "Politics and the English Language" in high school. If you are a writer (and if you are a blogger, you are a writer), I strongly recommend you read this piece.

In it, Orwell discusses what he sees as the denigration of the English language by lazy writers, which influences the way people think and the way people behave. He says that hiding in the abstract, rather than explaining the concrete, reduces the need of critical thought and critical dialogue, which can create a level of complacency with the status quo in society. If a writer describes the bombing of a village during wartime, he says, as "pacification," the images of the reality of that violence will never spring into the reader's mind, and therefore, no one will question the action. (If you've read his most-famous work, "1984," this theme isn't anything new.)

Now, I'm not trying to argue that the nonprofit sector is guilty of misconstruing language to the point that war crimes are glossed over. But I do think we are guilty of what Orwell described in the quote that started off this post. We quickly fall into the abstract, either in writing or in talking, which can lead to the confusion between organizations that Tuan describes. If one person thinks of social enterprise as strictly a for-profit venture, but another thinks of it as anything that is working to create social change, whether it be for-profit or non, that can create issues as both of them try to work out the concrete details needed to get anything done.

I think the most obvious example of this is the word "nonprofit" itself. We throw around the phrase nonprofit for anything with 501 (c) 3 status, which is technically accurate, but fundamentally devoid of any real meaning. A nonprofit can be a grantmaking organization, a community-based health center, or a gun lobbyist organization. Making statements about the "nonprofit sector" are general and broad, and therefore, most certainly inaccurate. I've read studies or blog posts with authors who describe trends for community-based organizations, or funders, or educational institutions, or high-net worth philanthropists, but instead of keeping their conclusions concrete and specific, they rely on the word "nonprofit" to make general conclusions. The lack of specificity confuses and is counter-productive.

There are many reasons for this reliance on the abstract, and most of the are reasonable. The nonprofit sector (see, even I do it!) has only recently, compared to the business sector, been accepted as a "sector," with best practices, a capital stream, professional development, etc. The difficulty with measurement of social returns, as described in Tuan's article, makes it difficult to come up with a standard set of reporting language, which I think influences general language use regarding nonprofits. These are real issues, but they need to be addressed. Collaborations among nonprofits are becoming more and more essential, and standardized and specific language use is necessary to create successful collaborations. If we can't talk to each other in the same terms, it'll be a lot harder to get things done, and we will just keep shooting in the dark when we talk to each other about our work.


                                                                                                   
Disclaimer: The postings on this site are my own and do not represent the positions, strategies or opinions of Venture Philanthropy Partners