Thou Foolish Philanthropist

 In Business, Culture, Fred's Blog, Giving, Philanthropy, Social Entrepreneurs, Technology, Vocation, Young Givers

In 1841 Ralph Waldo Emerson wrote, “Do not tell me of my obligation to put all poor men in good situations. Are they my poor? I tell thee, thou foolish philanthropist, that I grudge the dollar, the dime, the cent I give to such men as do not belong to me and to whom I do not belong.”

Since then there has been a steady succession of philanthropists working to become something other than “foolish.” Andrew Carnegie stands out as one of the first. He (and a few others) established scientific philanthropy, which was designed to be “secular, rational and empirical as opposed to sectarian, sentimental and dogmatic.” The goal was to define the problem, conduct laboratory-like experiments, draw provable conclusions, and then carefully implement the findings to correct social ills.

Scientific philanthropy did produce changes—notably the settlement house movement to address the root causes of urban poverty—but foundered against the complexity of the problems that were not solved as rationally and empirically as once thought. So the next generation of donors and consultants took their cue from the growing discipline of professional management and began to push for charities, churches and foundations to be more “businesslike” with clear goals, strategies, structure and measurable results.

This traditional nonprofit business model for well-established charities and foundations remained in place, but it also led to a new, entrepreneurial model for start-ups in philanthropy. (In the years between 1975 and 2008, more than 250,000 new nonprofits were formed, a trend that continues today.) These entrepreneurs are not as interested in structure and time-tested strategies as they are in growth. The new organizations were begun and funded by individuals and donors who see the opportunities to grow quickly and take more risks.

We have also seen the rise of impact investing, which allows an individual or foundation to be an investor in for-profit companies with the intention to generate social impact alongside a financial return. Impact investing provides capital to support solutions to the world’s most pressing problems through the vehicle of business. It is not charity.

We’ve come a long way from being foolish philanthropists, and now, I believe there is a new mindset taking hold in philanthropy. As technology is now at the center of how we think, work, eat, sleep and live, it makes sense that we will see everything—including how we give and, maybe even more importantly, how others receive—through a unique set of glasses.

I wanted to know more, so in the past few weeks, I posed this question with tech experts from all over the world:

“What do you see as the mindset of technology and how does it differ from science, business and investment models? While technology may have once been merely a tool for “faster, better, stronger” and increasing efficiency, it actually carries with it a particular idea of how the world operates. I’m not thinking about how nonprofits adopt technology but how donors will adopt tech thinking.”

These six assumptions kept returning to our conversations about how tech people think—and what they will hopefully bring to the practice of philanthropy:

  1. “I don’t want to be held hostage to experts.” Silos of protected knowledge and experience are the enemies of learning and finding solutions. Information should be everywhere and easily accessible by anyone interested. Example: Good Ventures
  1. “We are working on an algorithm that will solve that problem.” Philanthropy—just like our day jobs—should be disruptive and constantly looking to simplify what is complex. Example: IBM’s Watson Fights Cancer
  1. “There are patterns here that we may not see until we filter the data more creatively.” We have the ability to connect seemingly disparate information using tools for comparison and analysis that lead to an integrated view of options. Example: Give Well
  1. “I want it now and I want it to be easy.” Speed and convenience are essential. Example: Instead
  1. “I want to win at this level and move up to a harder problem to solve.” Gaming is not just our favorite means of entertainment; it’s often our model for the way the world works. With its emphasis on constant adapting, moving up to the next level of expertise, and winning faster, we often incorporate our gaming skills into our basic approach to problem solving. Example: Hunger Crunch
  1. “Give me other really smart people to work with and we’ll figure it out.” Smartness has more value than money. Example: Laura Arrillaga-Andreessen Foundation

 

All of these assumptions have trade-offs and while, like the models before them, they will come and go, the next few decades of philanthropy are going to be marked by them in extraordinary ways. I would love to hear your thoughts on how you see the blending of technology and philanthropy.

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    Scott Hillstrom
    Reply

    Thanks for this wisdom-packed message, Fred. Most of us are capable of engaging our business acumen to serve philanthropic aims as did Carnegie and a great many since. Often, the contribution we can make besides money is not apparent because we yield to “the experts”. Actually, most gains against poverty and disease, mankind’s greatest plagues, were won by building businesses. New technologies and business models now make it possible for almost anyone to make an impact by investing money, for sure, but also our personal skills, time, experience, and and energy. God will raise the valleys and level the mountains (Isaiah 40) if WE will join hands to serve Him by serving the objects of his mercy spending ourselves, not just our money, for the well being of our neighbors around the world. (Isaiah 58).

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    Ted Chen
    Reply

    Fred, I appreciate your insights into how donors might adopt tech thinking. Another aspect of tech thinking is not being afraid to fail. By “failing often to succeed sooner,” tech thinking promotes rapid innovation and improvement. They find out what doesn’t work to get ultimately at what does. In philanthropy, we tend to focus on positive impact and successes, in part, because we want to feel good about our donation choices and grant investments. This sometimes short circuits our learning that can come from insights on projects that didn’t go as planned. So with tech thinking, perhaps we can create space to celebrate failure. Then we can improve.

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    Peter Kubasek
    Reply

    Awesome Insights – As GOD challenges us to live our Faith – we must also LIVE our philanthropy — thx for sharing some additional tools

    Too often I am NOT living out my philanthropy – just executing it

    peace
    Peter

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