This entry to the One Post Challenge comes from Peter Deitz. Peter writes a blog called About Micro-Philanthropy and is the founder of Social Actions, a community website that aggregates person-to-person fundraising campaigns and helps people to start their own. Deitz also works as a consultant to nonprofits and philanthropists interested in leveraging the power of social networks.
By Peter Deitz
The Futures of Philanthropy, Fundraising, and Advertising
The futures of philanthropy, fundraising, and advertising are looking remarkably similar. In all three fields, technology innovators are turning to real people to do the hard work of moving money.
Foundations are asking non-specialists to “crowd source” their grant recipients. Development teams are using “wired fundraisers” to increase online donations. Companies are relying on “fansumers” to promote their latest products.
The online marketing guru Seth Godin first reported on this trend in a series of e-books entitled Flipping the Funnel. In three versions of the same e-book, Godin addresses companies, nonprofits, and politicians. He instructs them on how individuals can be empowered to sell products, raise money, and recruit votes respectively.
Godin could easily have written a fourth version of Flipping the Funnel, one tailored to the needs of foundations and private philanthropists. The hypothetical e-book would have emphasized the important role that non-wealthy and non-specialist individuals can play in awarding grants and redistributing wealth.
Flipping the Funnel for Foundations and Private Philanthropists would have noted that:
- Real people are often excellent judges of innovation and long-term impact;
- If provided with the right incentives, individuals may back their grant recommendations with donations of their own, resulting in larger grants and more grantees;
- People who are involved in grant-making are more likely to recognize a philanthropist for his or her contribution to the field.
Today, only a handful of nonprofits are effectively using wired fundraisers to raise money. Companies experimenting with fansumerism are drawing criticism for their attack on consumer privacy. And only a handful of foundations and private philanthropists are actually crowd-sourcing grant-making.
And yet, the innovators in these fields are continuing to experiment with new technologies that enable person-to-person communications and discernment. Overtime, the pioneers who balance privacy and fraud concerns with the opportunity for greater sales, donations, and grants will reap rewards for their early adoption.
Compared to fundraisers and advertisers, philanthropists have been the least exuberant in their embrace of the peer-to-peer economy. The sector needs leadership and technology innovation so that more wealth can be moved, and more effectively.
This post will hopefully serve as a starting point for discussing the trend as it pertains to philanthropy. Lessons from person-to-person fundraising and advertising will no doubt inform the discussion and provoke more innovation.
I look forward to exchanging ideas with the Tactical Philanthropy community and the larger world of emerging philanthropy bloggers.
Interesting post, Peter. Generational differences? Digitial natives versus the Boomers who now set the course of established philanthropic systems and processes? Seems that one big thing happening now is the socialization of Gen Y into giving of time, money, attention, online. As you take over the world, as you will, you won’t have to convert the Boomers, just bury us with dignity, I hope.
Yes, there’s an interesting generation gap in the thinking that underlies my post… but i would point out that the gap is actually an opportunity.
Boomer philanthropists can continue to give in the way that they have planned _and_ they can leverage their giving power to encourage generation Y folks to follow suit.
This approach takes a little more effort, but accomplishes more.
Kevin Bacon’s matching grants on SixDegrees resulted in $500,000+ in online donations by offering only $60,000 in matching grants… sounds like good “return on generosity” to me.
In the future of philanthropy that I envision, people with money identify areas where they want to have an impact, and then encourage generation-Y folks to make decisions about where specific micro-grants are delivered by offering matching grants, hosting contests, crowd-sourcing the recipients, and partnering with passionate generation-Y bloggers.
Some of my inspiration comes from Richard B. Gunderman’s paper: “Giving and Human Excellence: The Paradigm of Liberal Philanthropy”
I liked your post, very well written. I agree with you, I think the future of Philanthropy, Fundraising, and Advertising is changing. One of the largest corporate donators to children’s charities in the world has developed an advertising and marketing plan that rewards people for their philanthropic efforts in the form of monetary compensation. This is certainly a paradigm shift in the way giving is carried out. The project they’ve started allows people to start their own profitable business by feeding starving children across the globe.
6 minute recorded message about the project: