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We’ve all been swamped with a million different threads pulling us in various directions and that is where I have been for the past couple of weeks – hence, no posts. My summer resolution is to pick up the slack and reinvigorate the blog. No more putting it off until tomorrow. With new vigor applied to time management and a series of reprioritizations, I will learn from this and forge forth.

FailureIt is this recent recognition of failure that makes this discussion ever more relevant. Basically, the question goes like this: why is trial-and-error and the risk of failure understood, if not highly regarded, in the private sector but shunned almost entirely in the nonprofit and philanthropic world?

VPF has been wandering the depths of RFP development for the last couple of months and has hit upon the issue a few times. We have been asking ourselves how much risk we are willing to take on while still funding an innovative entrepreneur that has a high-potential, creative solution to NYC’s persistent problems. Sounds like a riddle, doesn’t it?

Check out the discussion on Social Edge and add to this important conversation…

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Given that the environment is VPF’s topic for 2008, I have been reading up on some of the really great things happening to engage, educate and change the less enviro-friendly habits of my fellow New Yorkers. One of the things I ran across recently is “The Story of Stuff”.

Watch it, learn and be totally amazed at the true story of the new gadget you are crushing on right now. Below is a sneak preview:

And for the whole mini-film go to www.storyofstuff.com

How does this relate to VPF? Well, if we are to consider the true meaning of philanthropy (which is “goodwill to fellowmen; especially : active effort to promote human welfare” thanks to Webster’s Dictionary), then caring for our local and global environment has everything to do with it.

Basically, we need to tend to the global nest to ensure a viable future for human beings. Or, in another animal kingdom analogy, we shouldn’t be doing our duty where we we sleep. So if we begin to think about how things are made and who has to deal with the subsequent waste, we quickly realize that it ends up in somebody’s bed. If it’s a somebody, then it’s a human. If it’s human, then a good philanthropist will be concerned. If we are concerned, then we might think twice about what we buy. Get it?

Recently, VPF members elected the environment as the topic we will focus on in 2008 – meaning that our Grants Committee team is currently hard at work developing an RFP to actively seek out New York City’s most innovative, emerging social entrepreneurs that are tackling local environmental issues.

Appropriately, I had a discussion this morning with the Advisory Council about how we can best frame the environmental topic and differentiate ourselves from all the other funders focusing on the exact same thing. I was worried that we would be buried beneath the deluge of money currently being invested into environmental organizations and related projects. I envisioned two months of waiting for our first grant application going by with no biters because of massive wealth to be found elsewhere.

Then, to my utter surprise, I learned that though the environment is showing the largest gains in funding, it still is one of the least funded subject areas overall. For instance, in 2005 education ranked first (of 10 categories) in share of grant dollars claiming 24% of the funding, while the environment ranked sixth and gathered only 6%. Even when looking at the number of total grants given, the environment still came in sixth place (of 10), claiming only  8,195 grants from a total of 130,961 given in 2005. (Click here to see a full report from the Foundation Center 2007 Giving Trends report).

It’s a disappointment to learn this on Earth Day, of all days. But it provides more fuel for the engine – environmentally-friendly, non-polluting, fuel that is.

Forget about the Obama and Clinton snubs and plugs and put aside the blatant patting on the back of the Canadian tax system – this article offers a unique take on what’s wrong with traditional philanthropy. I was so excited to read it I forgot to finish my first cup of coffee this morning – a rare occurrence indeed.

The article uses Oprah’s Big Give as the representational apex of traditional American philanthropy (originating with the Rockefellers and Fords). Funny, I always knew the Oprah’s Big Give gave me the willies but I couldn’t articulate why further than expressing my frustration that it was promoting charity over problem solving. This article takes this basic understanding and explores it with a “US vs. Canadian governmental system” spin.

Using the example of a recent Oprah’s Big Give show in which contestants were tried with helping two impoverished elementary schools in Houston, Linda Diebel, the article’s author, states that during the entire experience “not one contestant turned to another and asked how such bleak Dickensian conditions could exist in American schools in the first place”. This, Diebel argues, is the sad truth happening right here in the US of A. While the infrastructure crumbles as the government turns a blind eye, really big money is being thrown at desperate problems with no larger impact than a temporary bandaid and the birth of another self-congratulating donor.

Yes, it’s an obvious pro-Canadian piece that over simplifies the situation – but it also offers a fascinating way to think about giving, how and why we do it and the invisible forces that drive us.

So often we think of philanthropy as an individual endeavor. Often, but increasingly less so, as something undertaken by the well-to-do and uber-wealthy. Innovation is churning within the philanthropic establishments and creating exiting new ways and means for us to effectively distribute resources where they are needed most.

But what about international states? They too act as unique entities on the philanthropic global stage though admittedly on a different scale. But they too desperately need a new way and means to distribute resources.

What got me thinking about this was this post about a recent OECD report that summarizes recent foreign aid trends amongst the 22 richest countries. Basically, despite the brouhaha Bono and Angelina bring to this work, behind closed doors government officials are scaling back their global philanthropic activities (aka foreign aid).

Dean, from the posted linked above, was on to something when he pointed out the arbitrariness of the 0.7% GNI standard for foreign aid contributors. He says that the amount should be based on “some combination of needs and capabilities to use the money” rather than a UN standard created decades ago .

I’m certainly no expert on foreign aid or it’s technicalities of distribution, but it is rather obvious that the current system is not adequately meeting needs. So what if we push into Dean’s thought further? What if, say, countries have to organize themselves enough to say what they need, how much, for how long and why and really, truly stick to it? What if they are required to state how they intend to play a part in solving the issue they require money for and are held to that, at the cost of future aid?

Admittedly, this reeks a bit of sanctions and unfair in many lights – itself very flawed. But what if we, as intelligent citizens, went with this idea as a thought experiment and wrought its inner workings? What can we take from the innovations within the domestic philanthropy sector? Would any of the ideas provide a pathway out of the current quagmire of ineffective foreign aid?

The questions continue and I can’t help but draw parallels and direct connections between individual philanthropy and foreign aid. But simple answers just no longer work anymore (and that’s all I seem capable of coming up with) and I am left dumbfounded in the wake of this recent downturn in global citizenship.

For too long now we, the public, have understood that there is something broken in this system beyond the amount that our state is giving. And people continually shock and amaze me with their ingenuity and innovation in the private and nonprofit sectors. So why a more open public is not called on to help innovate this area and help it break free of itself is really beyond me.

For now, keep your donations up at Kiva and your favorite nonprofit overseas…they need you more than ever.

I’ve been mulling over conversations from earlier this week that created a philosophical quandary with a philanthropic bent. Here’s the scenario:

Friend 1, who leans right (politically), gave me the typical lecture heard from politically conservative types that if the government got their sticky fingers off citizens’ money and discontinued their current ‘meddling’ in social affairs then collective individual and corporations’ naturally occurring altruism would have a chance to fix the world’s problems. In the current system, according to said friend, people/companies pay too many taxes to feel the impulse to give in a big way. So according to this theory, paying taxes = philanthropic stinginess. Or less money in your pocket means you are less likely to give away what you have.

Enter Friend 2.

Friend 2 tells me that in a recent 20/20 episode researchers examining the elemental composition of human happiness found that only 50% of happiness is attributed to genetic predisposition; 40% is controlled through daily thoughts and actions; and the remaining 10% is determined by our environment (i.e. how much money we have).

So what do these two things have in common? Well, for one the Danish are considered the happiest people in the world;
AND, the Danish are the highest-taxed people in the world (ie less money in the pocket);
AND, the Danish are top-notch philanthropists when it comes to corporate giving (ie more money given away).

Narrow scope of thought experiment aside, can we say there is there a linkage between money, happiness and giving?

Well, it seems that Friend 1 is dead wrong using the example of Danish company giving habits. So less money does not equal giving less. And we all know that money does not equal happiness. So does giving more equal happiness?

I don’t want to corner myself, but I have a hunch. Here is more fodder for thought: there is evidence that being kind can lead to happiness. So, using Friend 2’s 20/20 information, choosing to be kind in daily thought and actions holds up against other research.

Now, to stretch it further, could we say that being kind is also sharing resources (ie giving away money)? This is not necessarily “proven” (or I couldn’t find direct evidence on this online) but it seems that giving more is a rather happy endeavor. Could it be that if we all gave to our communities with our time, skills and dollars that we could see an increase in the happy quotient of our country?

I can just see the NYT headlines now: Surgeon General says charitable donation good for one’s health.

Donors are increasingly skeptical of how their carefully placed contributions are used. It seems that across the board donors are fed up with the scandals, the misplaced money, or the unwillingness to disclose exact money allocation among some nonprofits.

A recent article, “Where does your money really go?“, takes a broad view of this issue.

Worth the reading if you ever wondered how your money is spent by nonprofits. There’s even a brief mention of new philanthropy – though I think the author could have developed this further or giving a bigger nod to the upsurge in alternatives coming available to the average giver (like giving circles, for instance).

As always with these types of things, I admit that not all nonprofits act irresponsibly or squander generous donors’ money — but one just can’t be too careful these days.

As the first blog entry for NYC Venture Philanthropy Fund (VPF), I think it appropriate to talk about how we started and why. The ‘how’ and ‘why’ tend to be the most commonly asked questions so it seems a logical place to begin…

It all started as an article about giving circles in an airline magazine. Four months later, it was a meeting in my living room with 10 strangers. Today, it is a burgeoning organization in New York City dedicated to supporting local social entrepreneurs whose good ideas intelligently address persistent issues in our communities.

After that first meeting, I realized what VPF could really be. New York City is brimming with highly qualified, motivated and generous individuals interested and willing to commit precious time and energy to good ideas.

So with the idea of VPF in hand, we’ve managed to develop a Guidance Board and Advisory Council (in the works) to keep us on track. The Membership and Finance Committees have done their part to firm the foundation. We have a website, a partnership as a donor advised fund with the New York Community Trust and we’re on our way.

As for the ‘why’, it was best voiced at that first meeting: people need a place to do giving differently.

Why give differently? What is the impetus for changing the way so many of us give now?

Well, why do we give? Generally, we give because we envision a different reality and we want to support those who are driving the change we wish to see in our world.

VPF questions whether giving in the traditional style actually produces the desired outcome.

Scenario 1: You receive a letter in the mail or email in your box telling you of all the good work Organization X has done in the past year. They outline the horrors of what still exists despite their efforts. And now they are relying on you and your donation to ensure that they continue the good work they do to battle those problems. You write a check, send it off and feel much better for having done it.

You don’t know where your money goes, how it will be used, or the individual who might benefit from your generosity.

Scenario 2: You join VPF and make a personal annual contribution of $365 ($1 a day) to become a voting member. At the beginning of the year you, along with the entire VPF membership, vote on what topic you would like to support: environment, women, kids, education, health, etc.

Topical focus decided, you join the Grants Committee to begin seeking out local social entrepreneurs within the New York City neighborhoods that are addressing the chosen topic. You have a personal hand in deciding which organization or individual makes it to the short list.

In the fall, you again have the opportunity to vote on your favorite social entrepreneur on the short list and decide where your contribution goes. Being an organization based on democratic ideals, majority wins.

In the coming year, your money is distributed to the organization and VPF begins to deploy members that are interested in volunteering their hard won skills to the organization. Having never actually volunteered anywhere beyond writing a letter or answering a phone, you decide to volunteer your skills. Now, not only did you have the chance to find and select the place your money went, you also have a direct hand in shaping and strengthening a powerful effort to affect positive change in your local community.

Now, that’s giving.

 

 

 

 

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