Influence, Philanthropy & Impact

In response to my post yesterday, philanthropy consultant Renata Rafferty writes (via Twitter):

…"Dinosaur philanthropy" is still where’s it’s at and shouldn’t be ignored.

Those with the gold are old and have barely mastered e-mail. Did you see the tweet with average user age for various social media sites?

Influence may matter on a macro scale but in communities like mine where easily $50M is given a year they have never heard of social media, venture philanthropy or tactical philanthropy.

My post yesterday wasn’t really about social media. It was about influence in philanthropy and how social media allows influence to scale in unprecedented ways. Renata is right. Much of the money being given in philanthropy is being given by people who do not use social media tools. But that misses my point.

In philanthropy, all you have to do to achieve impact is to influence where money is given. This isn’t true in the for-profit market, where only the money you put to work personally accrues returns that benefit you.

For instance, last December I made a $1,000 donation to FORGE. But after reading my rationale, a foundation made a $50,000 grant to the organization. Let’s assume that those grants resulted in positive impact. All of the “return” benefits the public at large. Therefore, it is not only the impact of my $1,000 grant that is meaningful to me. Through sharing information, I helped generate additional impact via the follow on grant that was made at least partially based on the information I shared.

This is not about social media. This is a fundamental underpinning of philanthropy. This is why I constantly harp on transparency and information sharing. Since we all benefit from the impact achieved via philanthropy, we should do out best to assist other grantmakers make the best possible decisions. And that means sharing information with them.

That being said, social media tools are all about super low cost, incredibly easy, sharing of information. They are tools that are custom designed to revolutionize philanthropy and radically increase the total impact being achieved.


  1. Caroline Preston says:

    Renata and Sean, glad to see the Pew study with info on average user age for social-media sites was useful. One quick note: @SuburbNews (a reporter at the Milwaukee Journal Sentinel who covers nonprofits) was actually the original source of that tweet. Apologies for forgetting my “RT” lingo!

  2. Slap me with a sardine! I must have been in a potato chip haze when I read your initial blog post.

    My concern is that “we” (and the quotation marks are whole other discussion) are increasingly focusing on foundations and social venture/social entrepreneurship leaders as the “A list,” the cool kids, the ones who “know where it’s at.”

    Those of “us” (see above) on the “cutting edge” of philanthropy (be it tactical, strategic, entrepreneurial, or philanthrocapitalistic) tend to navel gaze, looking ever more deeply into how our groovy new ways of thinking about philanthropy are … well, groovy.

    One-the-ground reality in everyday communities, however, is more about gala slippers on the ground than eco-friendly boots on the ground.

    I live in an extraordinarily wealthy community, where millions change hands between individuals and families (sometimes through a tax structure called a family foundation)and the nearly 300 charities in our area.

    And influence plays a HUGE role in where the money goes — but the influence has little to do with a real understanding or examination of community needs, community assets, and who is doing fine and deserving work. And as to focused giving (“tactical” is so far from just basic focus), there is little focus.

    Perhaps this is because there is no community discussion around issues of vision, change, need, leveraging of resources. etc. Most of these people have never heard of (or if they have heard, don’t care about) the Chronicle, CoF, SVPs, blogs, tweets, web-based forums, etc. centering on philanthropy.

    Sometimes I feel like one of the few left on the dock watching the philanthropy boat sail away, leaving behind the well-intentioned, kind, caring, wealthy people who are so generous with their giving, but who just aren’t part of the “cool crowd.”
    I affectionately refer to them as the “dinosaur philanthropists” who pump the majority of contributed funds into the sector each year, with such innocent naivete (or calculated high-society motives) as to be awe-inspiring (they are feted at annual Philanthropy Day luncheons) but less than truly effective.

    It will be years before those who take changemaking seriously are in the majority — or have the majority of the money that will flow into the sector. Do we simply ignore two generations of donors who don’t “get” the cutting edge stuff?

    Do we foster a disservice to those generous people and to the cause of philanthropy as a whole by rushing to the new-fangled Web 2.0 social media techniques and telling them, at some point, that their rabbit ears (galas) are obsolete and analog (quid pro quo giving) is SO not where it’s at?

    Lately, I wonder whether I should leave the field of philanthropy — perhaps it has already left me. I continue to plod along, sweet donor by sweet donor, showing each how one CAN about change the world, and get excited about it, by just thinking about and focusing on what they believe is central to the human experience.

    That’s why I bothered to re-write and expand “Don’t Just Give It Away” (what a crass title!) rather than let it rest in peace after ten years of being a best-seller among the dinosaur crowd.

    The new book is bodaciously titled “Smart Generosity: Everything You Need to Know About Charity, Philanthropy, and Giving Wisely.” I worried that the “cool kids” would slam me for writing such a “simplistic” primer and suggesting that it covers “everything” you need to know. But the reality is, it does. To use an analogy, it teaches you how to ride a good old-fashioned bike safely and enjoyably.

    Once a giver has mastered that,they have the basic skills preparatory to contemplating Harley-class philanthropy — be it tactical, strategic, entrepreneurial or philanthrocapitalistic.

    So, can I still hang out with the “cool kids” even if I don’t feel I belong?

    Renata Rafferty

  3. That’s right Sean, it’s about sharing. Reminds me of a presentation I saw once. The speaker said be wary of those who “ride high in the saddle by piling secrets under their ass.”

  4. Caroline, we’re all still working out Twitter protocol!

    Renata, your comment shows why 140 characters isn’t enough and Twitter will never replace blogs as some people seem to think. (I’m reposting your comment as a blog post in a minute).

    Bruce, I’m not sure what to say! ;^)

  5. Re: Influence, Philanthropy & Impact

    I have often said that foundations have three currencies: the money we give, the knowledge we have, and the networks we build. Effective philanthropy uses all three. We can convene colleagues over coffee on topics of mutual interest or convene them through social media. The point is, unless we fully engage with all three currencies, we will not be as effective as we want to be in our grantmaking.

  6. I think that’s right Carol. What’s interesting to me is that small donors can learn to wield the currency of knowledge and networks even if they don’t have significant financial resources.

  7. Sean’s post on influence in philanthropy makes me think of SSIR piece "Leading Boldly"

  8. Good post. It’s not the money; it’s the influence. Social capital is now as important (if not moreso) than fundraising clout. This is signaling (or should) a change in the way traditional nonprofits are organized. The old way? Development meant raising revenue. Now it means making community. Huge shift in strategy and the old definitions of clout. Nonprofits are the old middlemen, disintermediated by the Net. Key now is reinvention.

  9. Bela says:

    Renata certainly got the part right about philanthropod naval gazing, among many other things. Walking in lock-step and driving towards the same matrixed bottom line results is well, boring, making it difficult to innovate (messes up the dashboard of indicators and theories of change fly out the window). Philanthropy as a practice is a richly textured tapestry of ideas and activities. Its diversity of approach is one of its strengths and asset, and allows for creativity and innovation (however micro), not to say that some ideas aren’t better than others. There’s room for everyone. How can I put this? If it ain’t broke… (refining is one thing; cutting from whole cloth another) There’s nothing new under the sun… What other cliche can I use?

    And to the comment “there is no community discussion around issues of vision, change, need, leveraging of resources. etc.” Who’s fault is that? Maybe we don’t need a new market model for social investing (or maybe we do?), but a new model for active participation in our communities. Where great ideas flow, money follows, which is the point Sean was trying to make, if I “get” it.

    The cool kids need to unbundle their ideas a bit?

  10. Marcia, I’m not so sure nonprofits are “middlemen, disintermediated by the Net.” Organizations have proven themselves very valuable in the for-profit space. I don’t see “peer-to-peer” philanthropy replacing “citizen-to-organization-to-clients” philanthropy. But I think you and I see eye-to-eye on most of this.

  11. Bela, “Philanthropy as a practice is a richly textured tapestry of ideas and activities.” Perfectly said!

  12. Sean,

    I completely agree with the value of influence and you can be a dinosaur or cool philantrhopist and still use your influence to have people think about philanthropy. I haven’t talked about it on Twitter or my blog, but we decided to address this in our Christmas Letter this year. Here is the paragraph about our philanthropic philosophy:
    “In the last few years we have gotten more involved on a personal level at Saint Vincent’s Academy in Newark (where Marion went to high school) and at NJIT. We have decided that the focus of our charitable support will be on underprivileged high school students. Both NJIT and St. Vincent Academy have extra-curricula programs for these kids that expand awareness, skills and confidence in various topics such as art, culture and finance. Marion has been a mentor for SVA at many excursions and both of us have attended events at NJIT. Our involvement at both places has been inspirational and has given us a positive outlook for the future.”

    We were surprised at the number of people who mentioned this portion of the letter and it led to some interesting discussions. I think it may people think about their philanthropic philosophy and I’m glad we decided to address it.

    The power of influence is important – offline or online.