It’s National Philanthropy Day today. Go out and be generous and thank others for their generosity!
And while you’re at it, thank an entrepreneur. A recent study from Fidelity Charitable Gift Fund showed that, amongst other statistics, “companies led by entrepreneurs allocate more than twice the percentage of their profits to charity than many of America’s largest companies.”
Hi, my name is Tony Macklin. I’m a philanthropy geek. (Hi Tony!) I just downloaded reports on the motivations and behaviors of donors. I hadn’t downloaded reports for three weeks, but, I felt weak and couldn’t help myself.
From the Nonprofit Quarterly, What Do Donors Want? – Philanthropic advisors William Dietel and Cynthia Gibson caution against an uninhibited “march to metrics” in the world of philanthropy. They join The Philanthropic Initiative’s Peter Karoff and other in arguing for keeping a balance of art and science in giving by donors and foundations. They also cite an upcoming book by Princeton’s Danny Oppenheimer that summarizes research into giving behavior:
“no matter what objective information is available, the large majority of donors will give as a result of emotional or relational factors.”
I’ll probably even pick up Oppenheimer’s book, though I’ll probably need the new book Proofiness to make sure I understand the data…
From the National Center for Family Philanthropy, The Power to Produce Wonders: The Value of Family in Philanthropy – NCFP interviewed 300 family philanthropy leaders to learn more about how giving adds value to their lives, how their personal participation adds value to the giving process and its results, and the value family philanthropy provides to America’s democracy. Families cited family giving as helping them, among other things, express their passions, continue their entrepreneurial spirit, and provide a means of sustaining values and legacy. The hope of the family having a specific measurable, data-driven impact doesn’t appear on the list, though I suspect that could have more to do with the line of questioning rather than a lack of any interest.
And, from Russ Reid, Heart of the Donor – The firm’s telephone sample of 2000+ adults confirmed trends in giving by other studies. It also re-affirmed that donors use online research to check up on nonprofits, but human factors overwhelmingly keep a donor coming back to give again: the organization’s fit with the donor’s interests (e.g. dance or dogs or dancing dogs) and the organization’s trustworthiness and integrity.
Maybe it’s time to set up a national referendum on the donor motivation parties, allowing the “philanthropy is art” vs. “philanthropy is science” parties to argue their cases in heated debates, high-paid ads, and shadowy viral videos. Those of us “it’s both” moderates – as in today’s electoral politics – probably need not apply…
Recent conversations and readings have inspired my thinking about a hypothetical Community Giving Center – a physical and virtual network of and for generous people.
What’s a Community Giving Center about? In my last three posts, it was about the right physical environment, a culture of reciprocity, low-level affiliation, open architecture operations, employing network weavers, and mobilizing resources around resonance. In addition…
It’s about “meaningful giving,” not “effective giving” – the recent research report, Money for Good, showed that wealthy donors say they care about the effectiveness of nonprofits and their own gifts. However, few donors do intensive research into effectiveness before they give. What’s more, donors are incredibly loyal, with 86% of donations going to the same organizations as last year.
This shouldn’t come as a surprise. People naturally want to be right – we naturally feel we’re smart donors or investors. It’s called confirmation bias, “a tendency for people to favor information that confirms their preconceptions or hypotheses, independently of whether they are true.” Behavioral economics and communications research confirms that our emotions and beliefs will outfox facts and rationality every day. Two recent great reads on this include Network for Good’s Homer Simpson for Nonprofits (doh!) and the Boston Globe’s article, How Facts Backfire.
There will never be universal demand for nonprofit effectiveness ratings, outcomes data, and program logic charts. (Sorry friends in the evaluation world.) But what is universal is our search for meaning and for connections to community and something bigger.
Our hypothetical Community Giving Center is ultimately focused on helping people get their generous stuff done, whether that is donating, volunteering, advocating, or investing. I think this will mean more time helping people define and act on what is meaningful for each of them. More time helping them connect with others who share their hopes and concerns for the world, and even taking action together. Questions about impact and effectiveness may naturally flow from the network of generous people and the Center would help them explore options that make sense for them. But the Center would lose donors’ trust if it tried operating with a culture that “impact-based giving is better than emotion-based giving” (e.g. “we professional staff or long-time donors are smarter than you”).
What if nonprofit CEOs, foundation staff, and philanthropy advisors (including me) and philanthropy critics gave up their addiction to telling donors what to do and how to give? (And, who will create the drugs and 12-step groups necessary to support that process?) What if a traditional philanthropic institution was truly generous and gave away the concepts of “good giving” and “right solutions to community problems” to generous community members?
Conclusion (for now)
Consultants more experienced than I am say the world of philanthropy is going through big changes. The Monitor Institute’s What’s Next for Philanthropy and Duke University’s Disrupting Philanthropy are just two of the important current analyses of philanthropic trends and changes.
The world is working in more networked and transparent ways. Boundaries between private, philanthropic, government, and citizen sectors are blurring. Individual donors and entrepreneurs have more options to express their generosity, attract others’ generosity, and drive community change. Existing institutions that work in community philanthropy – United Ways, giving circles, community foundations, churches, youth service initiatives, and others – are facing tough culture changes to survive these changes and more.
My hope is that the hypothetical Community Giving Center I’ve described may offer some clues on new ways for those existing institutions to do business. At the core, the idea of the Center is about helping people get their generous stuff done, however they define that along the way. It would attract people through a setting and culture that create a trusted, authentic, fun, and useful experience – one that meets the changing ways the world works and changing options people have to express their generosity. Done right, I think the result would be increased giving, volunteering, advocating, and socially-conscious investing.
What do you think? Is the Community Giving Center idea worth pursuing? Is it even feasible?
A recent conversation with Bill Traynor and other readings on networks have inspired my thinking about a hypothetical Community Giving Center – a physical and virtual network of and for generous people. Hopefully the ideas will inspire other community philanthropy groups.
So, what’s a Community Giving Center about? In my first two posts (here and here), it was about the right physical environment, the culture of reciprocity, low-level affiliation, and open architecture. In addition…
It’s about “weaving not managing” – And, it’s about leadership focused on network building over managing or institution building. Traynor talked about the importance of his staff and other neighborhood leaders being “network weavers.” Their purpose is to grow their community’s capacity for collective decision-making, problem-solving, and information sharing. The Networked Weaving blog says that weavers connect people strategically where there’s potential for mutual benefit, help people identify their passions, and serve as a catalyst for self-organizing groups.
I love the idea of people dedicated to growing and connecting others’ philanthropic problem-solving skills. Many community foundations, giving circles, and donor groups strive for this. However, I see them often caught up in focusing on the grant transaction process. After the grants, the donors may understand little more about their individual hopes or how to achieve them not just as donors, but as connected citizens, community leaders, volunteers, and people of faith.
What if your local community foundation hired “network weavers” instead of “program officers” and “donor service officers”? Or, what if philanthropy network weavers were co-hired by the community foundation, United Way, and local wealth and estate planning advisors? What if their charge was to be a trusted resource to increase community giving, regardless of the outcome for their employer(s) and regardless of their personal or organizational agendas?
It’s about mobilizing resources around resonance – the article “Working Wikily” describes how networks (online and in-person) make it easier to mobilize people and to coordinate resources and action. In The Networked Nonprofit, Beth Kanter and Allison Fine discuss how nonprofits can work with networks and even “free agents,” passionate givers working outside of organizations.
Bill Traynor talked about how his network-based organization is striving to be more demand-driven, deriving new programs and community agendas from trends in choices the network members make or desires they voice. Bill uses what he calls “resonance testing,” a process through which his staff members help community residents formulate ideas, test if there’s interest in the idea in the larger network, and then test if there’s willingness to act on the idea. The process builds authentic buy-in but also creates a low threshold for letting an idea go if there’s no resonance or ongoing purpose.
It’s easy for a nonprofit or grantmaker to set an agenda and then go after other people’s money to accomplish the agenda. (Score points in philanthropy buzzword bingo by calling it “seeking aligned co-investors to move the needle in a community change agenda”). However, these agendas only make a lasting different when a broad set of well-connected community stakeholders own them. Using great stakeholder engagement, as advocated by Grantmakers for Effective Organizations, is a start but isn’t enough. Truly effective and lasting community improvement will draw from the power of resonance testing and resource mobilization by a network of generous people.
What if community philanthropy groups mobilized community resources based on resonance testing rather than boring needs assessments? What if they put their own philanthropic resources behind the action of free agents and helped weave those agents together?
I think a great Community Giving Center would be a hub for weaving generous people and helping them test their own ideas for engaging others in community change. Is this too uncontrollable “power to the people” for you yet? Maybe, but ultimately it’s about trust and true generosity – more next week!
Bill Traynor and other experts who are applying network theory to nonprofits have inspired my thinking about a hypothetical Community Giving Center. Hopefully the ideas will inspire other community philanthropy groups.
In my last post, I talked about the center’s physical environment and culture of reciprocity. Here’s what else a trusted, cool Community Giving Center would be about:
It’s about “low-level affiliation” and “choice” – we all value choice and options based on our changing interests and needs. The concepts of options, opportunities, and real consumer-driven choice are some of the most effective communications messages (see The Language of Trust, Words That Work, or other books on communications framing for a deeper dive on this).
The Community Giving Center would be set up to be easy to join and leave, to move in and out of options to participate, and to take advantage of options for reciprocal value exchange. Bill Traynor said to think of a networked organization as a health club without a binding contract; people want to be connected to a place with exciting options, but not obliged to it.
It’s about “nimbleness” and “open architecture” – It’s about function (getting things done) over form. Traynor noted that people of all demographics are fleeing highly-structured organizations with high expectations of “members.” People want environments that are flexible, time-limited, and able to re-organize as they go. Nonprofits, unfortunately, tend to have a tough time moving away from hierarchical, rule-bound committees and organizational forms. A network-oriented Community Giving Center would revolve around rapid iteration. It would support self-defined, self-organized groups of donors in testing new ideas and projects, evaluating next steps, and expanding or shutting down the project as they saw fit.
What if a generous person was able to jump in at any point and watch or even participate in a grantmaking committee at your United Way or community foundation? What if your local giving circle invited you and your friends to test some ideas with them, allowed you to give along side of them as it made sense for you without having to officially join?
Intrigued? Me too. More ideas in the coming days.
What if donors had really cool, trusted places to learn and gather? What would those places be like?
I’ve been puzzling through this question for a couple weeks after reading recent research and commentary on how donors use or don’t use information to guide their giving.
I think much of the answer can be drawn from what philanthropy is learning from working with and through networks. Working Wikily, The Networked Nonprofit, and the Network of Networked Funders are just three of the popular resources. But my primary inspiration is a recent conversation with community development guru Bill Traynor and board members of Grassroots Grantmakers. Bill heads Lawrence CommunityWorks in Massachusetts. He and his team are going through the hard work of restructuring the nonprofit to operate more as a network rather than a traditional community center or social service provider.
I’ve used the insights Bill shared with the group to create a hypothetical “Community Giving Center” – both a physical and online place in which we can try some of Bill’s and others’ ideas. I think the ideas could be applied to donor service organizations such as community foundations, United Ways, giving circles, or some wealth management offices.
So, what’s a cool, trusted Community Giving Center all about?
It’s about a “human environment” – the vibe of a place makes or breaks a person’s participation and behaviors. It’s about the right room set-up, the feeling of welcome and friendly fun, the interactivity. Traynor said Lawrence CommunityWorks is becoming not a social service agency (though it offers services) but a place that people love to come “to bump up against one another.” Maybe our ideal Community Giving Center would even be a great Third Place, an anchor of creative community life.
What if your local United Way was a place that donors loved to hang out informally and share their passions about life and the community? A place that donors came to be inspired at their own leisure instead of just to sit on a committee? Or, what if the United Way relocated some staff to existing Third Places frequented by generous individuals?
It’s about “value exchange” and “co-creation” – the place would be about collaborating to find answers, not about “servicing donors.” Traynor reminded our group that people are most willing to bring different forms of capital (intellectual, relational, financial etc.) when they see opportunities for good value exchange. They’ll be more likely to return to a place if: a) they feel like they can get stuff done that’s important to them, b) their perspectives and needs are valued, and c) there’s reciprocity in the relationship.
When Generous Jim walks in, a Community Giving Center staff member would sit down with him in a casual environment and talk through what Jim was trying to accomplish. She might introduce him to other people working on the same issue or guide him to some online or print resources (not do it for him). As Jim finds answers and Jim and the staff member get to know each other better, she might invite him to lead a discussion group on the mission trip his family took and what they learned about the needs of the country they visited.
What if your local community foundation didn’t treat donors as sources of new revenue, but treated donors as a latent marketplace of good ideas, relationships, and opportunities to learn and connect? What if the foundation let donors formulate and lead strategic initiatives, helping them get generous stuff done that is meaningful to them?
I’ll add some more thoughts in the next few days. Do you think these ideas could work in your community?
There’s been another round of intense dialogue in the philanthropy blogosphere regarding what motivates donors to give and how they give.
Research by a UK firm, YouGov, revealed that few donors found charity rating services useful. Sean Stannard-Stockton at Tactical Philanthropy kicked off some U.S.-based responses. Among others, Nathanial Whittemore at change.org, Jacob Harold at the Hewlett Foundation, Tris Lumley at New Philanthropy Capital, and then Sean again discussed three essential points:
Those authors and others also pointed to a recent study by Hope Consulting, Money for Good, that examines the preferences, behaviors, and information demands of donors with household incomes over $80,000. It breaks donors into six behaviors, with only 16% driven by “high-impact philanthropy” but 59% of the donors willing to give more or reallocate giving based on nonprofits improving certain behaviors and/or information. The full Money for Good report is a must-read for nonprofits, foundations, fundraisers and gift planners, and other advisors to donors – download and discuss!
In the midst of all of that came the annual bible of charitable giving data, Giving USA and its new free executive summary (another must-read). Two data points in Giving USA struck me as I was reading through the blogs and report above:
1) Giving by individuals only dropped 2.4% in the past two years, despite lousy markets, personal income, and employment numbers. To me, this confirms donors’ consistent will and intent to give whether despite the lack of widely-spread good information or analyses about nonprofits or their measurable impact.
2) Charitable remains at around 2% of GDP, and that number hasn’t changed for 40 years. I believe this means that all of us who care about charitable giving – and its positive impact on donors and recipients – have clearly not yet learned how to unleash large-scale, transformative generosity.
What to make of all of this information and opinion? I think it all re-affirms what I learned from the best philanthropic advisors: if you want to increase charitable giving, first, listen to a person’s story and hopes. Then help them find meaningful options for expressing those hopes through charitable giving. Then give them opportunities to experience those options – and the potential impact of gifts – emotionally, first-hand if possible. Then finally, help them with any background information they need to feel comfortable about giving.
My “grand unified theory of donor desire” is simply this:
People are driven by a fundamental search for meaning and belonging and a fundamental need to control their own destinies and make life choices. These trump data and pre-defined versions of effective philanthropy and nonprofit effectiveness. The more time and resources we can spend on the former, the more use there will be of the latter.
Or am I just being a crotchety old-timer and armchair psychologist?
P.S. – then again, this new effort by Gates, Rockefeller, Buffett and other to get billionaires to publicly pledge to give 50% of their net worth to charity might just trump everything else…
