More Philanthropy Debate

Very few foundation employees ever comment on this blog. I’d love them to join the discourse, but I get the sense they feel it is far too risky to let an individual express an opinion that might not be inline with “official foundation statements”. I think it’s a shame, because their point of view is being left out of the debate.

Nonprofit employees on the other hand leave frequent comments. We already had the back and forth between fellow CompuMentor/TechSoup board members Daniel Ben-Horin and Mike Brown. Today we get the thoughts of one of the employees, Antony Chiang. Public disagreement? Heavens, what will people think? I don’t know about my readers, but my opinion of CompuMentor/TechSoup (which was already high) just shot through the roof. Let me know how you view this kind of public debate and how you would react to public comments from foundation employees and board members.


No discourse like this should go on without the uniquely insightful perspective of someone like myself … my primary credential being the timekeeper at Mike’s panel at NetSquared.

However, I should perhaps warn that in addition to that impressive role, I have the distinct privilege to be part of the team expanding TechSoup’s impact internationally (and thus needing to be very nice to Daniel in this blog comment), as well as having worked in the cross roads of the non-profit / for-profit / technology intersection for quite some time.

My first reaction to the minor uproar I have to admit was “Really? Intentionally provocative but what was the big deal?”. Reading Daniel’s initial feedback about “content vs. context” was helpful (see I warned that I was going to be nice to Daniel). Got a good chuckle out of the NRA example, and I would say that essentially Mike was at a NRA/NPO panel where he said “some gun-owners/NPOs suck” and indeed got "didn’t get out of range/feedback regarding his insensitive language”.

To be fair however, here is some additional “context” that should be noted. First, this was a new model for NetSquared where the purpose was for 21 projects to persuade attendees to vote to fund them in a VC style pitch. Second, one of three key judging/voting criteria was “Economic Sustainability”, also phrased as “having a plausible financial model”. And the format was a panel set up to question each project representative on that factor (the other two being social impact and technical innovation). Third, Mike’s role was moderator (not just expert panelist). Here’s my point in more detail:

First, this was a competition. The nonprofits were there to compete for dollars, as well as drum up interest by resources like volunteer Yahoo developers and expertise in marketing / finance / strategy. The model and the whole conference reminded me very much of other “social enterprise” competitions, modeled on VC pitch competitions, where ‘business plans’ are presented for ‘startup venture funding’ to an audience of foundations/VCs. And I would add that the NetSquared community is a deliberate mix of VCs / Corporate / NPO / Foundations / Experts. So every organization there in my mind was buying into the social enterprise model, at least for two days.

Second, worthy projects were supposed to demonstrate economic sustainability. I was at all four of the economic sustainability panels. And I have to say that precious few of the projects demonstrated persuasively any economic sustainability. Panelists and audience members kept asking the same questions of all of the projects that it got to the point where moderators were asking projects to introduce themselves and then answer one key question right off the bat “What is your planned mix of earned income versus donation/grant income” usually followed by “how will the earned income be …. well … earned”. Sometimes the answer was “we’ll be 100% (or mostly) grant funded” and frankly that put the damper on any useful questions or suggestions other than to suggest funders who had an interest in their type of project. A perhaps meandering way of saying that the context was very much ‘market place’, and capital flowing to the most effective users of capita l. Daniel’s point is well taken that in the NPO ecosystem, the ‘market’ context is a new fad and not of general applicability, but at NetSquared at least I interpreted social enterprise as being the accepted model.

Third, Mike took his role as moderator with more gusto in my opinion than any of the other moderators. Maybe I’m just saying that because I had to catch his attention every four minutes to tell him the clock was ticking and he was always in the middle of fostering lively debate. At the outset, he encouraged everyone to ‘ask the hard questions, this isn’t softball”. He played fast and loose with the format of the session for the purpose of creating a more lively discussion, where all the other moderators followed it exactly. My impression is that he was trying to push participants in general (both project founders and audience) to ask hard questions, go deep and get really valuable feedback / resources than if just easy ones were asked.

With the disclaimer of fading memory, I seem to recall that this controversial statement (and subsequent explanation/observations) was made in the context of a project that wanted funding to give away free websites and free web tools. So absolutely no economic sustainability around what they wanted to get funded. And panelists and audience members alike were trying to get the project reps to at least consider charging some who could afford, or place advertising, or other ways to create earned income. And philosophically, should we be giving resources to just any nonprofit, when some are less effective (s**k) than others. Foundations and other funders certainly don’t just give grants to any org that asks. Mike wasn’t saying the project being questioned s**ked. My interpretation of this part of the panel was an observation that this organization should consider thinking like a funder and give free sites to ‘worthy’ NPOs and charge all the rest perhaps. Or at l east that’s what I was thinking at the time as yet another alternative way to try to get this org to consider earned income strategies. On the one hand I admired the org reps’ refusal to budge from their specific vision. And even a hyperbole didn’t work. On the other hand I didn’t think they were ‘competing’ very well to at least say “hmm those are some interesting suggestions we’ll consider and hopefully this demonstrates that we have some possible viable models of economic sustainability”. Or another way to say this – this project was in the wrong competition if they wanted to blatantly keep their specific vision/strategy and expect to win.

And one final observation regarding part of this thread, is that I remember Mike introducing himself as “Mike from TechSoup”. I wonder how many in the audience read his bio and knew his vocation, but my guess is most didn’t. My hunch tells me they would have been offended by the phrase no matter who said it.

Which leads me to my lesson learned. S**k is not in the warm fuzzy cup is half full nonprofit vocabulary. It’s not so much being PC as it is having one vocabulary with my buddies, another with my toddler, and another at the office, and yes, one at NetSquared. So while disagreeing with Daniel’s specific analysis, yet coming full circle to his observation that the context here was a nonprofit conference. When all is said and done, this wasn’t a rough and tumble VC pitch competition where you better have a tough skin, it was a NetSquared conference. Warm, yes. Fuzzy, yes. Dedicated to non-profits, yes. Culture and language of non-profits … a definite yes. Dare I say ‘sensitive’… also yes. Nonprofit staff are a self selecting bunch of folks (hugs all around please). It was perhaps the most collaborative competition I have ever seen. “No one left as a loser” was actually a truth at this one. Cliché but true. Everyone got a free trip to the conference , ended up with at least some extra dollars and a boatload of great connections and feedback. Competitors were not tech entrepreneurs, and instead talked like nonprofits talk and asked how they could work together on overlapping goals. So my final verdict … content = accurate. Vocabulary in this context = did not cross the line for some (myself included) but did for others.


  1. Michael Brown says:


    Great post. Agree with everything you said. And you’re right, I think is a terrific organization from what I know of them. I was pushing them to think about economic sustainability by working with organizations that can pay them (some small amount) to use their hosted software applications. I also appreciated the Grassroots’ team’s tenacity in pushing back. That was exactly the purpose of trying to make for a provocative session.


  2. M says:

    About the warm fuzzy nonprofit lexicon – the foundation that employs me is starting the practice of actually telling applicants why we declined their application (which flabbergasted the local fundraisers whom I broached the subject with – as apparently no foundation has ever been that straightforward with them – they were ecstatic!) They wanted the feedback.

    As I am just the lowly Program Associate I had the responsibility of proofreading the little blurbs that the Program Officers wrote for each decline. I ran into something that really irked me. There was a phrase that was repeated in many of the declines. The Program Officer wrote something to the effect that the case for support “was not very strong.” Then they gave 3 or 4 really good reasons why the proposal was uncompetitive, a bad fit or just plain wrong. Instead of saying “not very strong” why didn’t they just write “weak?” Why use 3 words when one will suffice? “Oh, weak just sounds too harsh” they told me.

    Some of the Program Staff were so worried about offending the applicant that what they wrote in their decline rationale was so vague and useless it was no more informative to the nonprofit than the form letter they used to get saying we get more solicitations than we could ever fund therefor we must decline you, etc.

    Maybe I am unique, or maybe it is just because I used to be a fundraiser, but if my proposal gets declined, I would want to know why. That way I can take steps to fix the problem.

    Why does the foundation world (or at least what I have seen so far) seem so reluctant to give honest, straightforward feedback to applicants? If somebody sucks – tell them so they can fix it.

    We don’t have to be rude or mean, and I certainly respect all nonprofits enough not to actually use the word “suck”, but I am still going to decline you. If your case is weak, I’m going to call it weak. Then I will tell you why it is weak, so next time you can be more competitive. If your governance structure is inappropriate, I will tell you why so that you can come in line with best practices.

    I know as foundations we are seen as being the ones with “the power” in the relationship between grantmaker and grantseekers. But with that power, don’t we also have the responsibility to help nonprofits better themselves? We exist solely to benefit the nonprofit sector they comprise.

  3. Yes, yesterday I spent 1.5 hrs with a NPO leader giving them the straight goods on why their org did not qualify for our support. I don’t put it in writing, but I invite them to call me for feedback if they wish it. When they do, they will get my honest evaluation.

    At the same time, I am convinced that the messenger needs to deliver the ‘bad news’ with tact and grace.

  4. Don says:

    Our foundation has a policy of calling applicants who have been declined funding roughly a week after the decline letter is sent.

    During those calls, the lead reviewer takes the time to discuss in detail the reasons why their proposal was not funded. We see it as a valuable way to build relationships as well as improving transparency with respect to our review process.

    The calls can be uncomfortable (applicants sometimes try to get us to reconsider their application on the phone), but it helps both parties understand the other better.

  5. sm says:

    “Very few foundation employees ever comment on this blog. …I get the sense they feel it is far too risky.” As always the reasons for something like this are always more complex than one might assume. I am an individual working in a regional Foundation in the Midwest and the truth of the matter is that our organization is just starting to come to this blog thing.

    On the topic of the quality of nonprofits, I think it is important to remember effectiveness can have several components. One of the things we have run into is culturally based self-help organizations serving new immigrants. In terms of human services delivery, we have any number of highly effective organizations that deliver services, meet needs, provided supports if you are a member of the dominant culture. On the other hand we have dozens of fledgling culturally based organizations which, in terms of nonprofit standards and best practices, are disasters. Governing structures are lacking, funding sources are sporadic or nonexistent; basic niceties of nonprofit management are all but missing- however, these are the groups that meet the needs of the target population. So the debate rages on…do we push everyone into the mold of the “effective” organizations or support organizations that “suck” but touch target populations albeit imperfectly.

    Our answer has been to push from both ends, supporting culturally based groups when the programs are strong and pushing more established organizations towards cultural competency.