Philanthropy Ideas That Spread

Sasha Dichter and I share an appreciation of the relevancy of marketing guru Seth Godin’s writing to philanthropy. Seth’s books, such as Tribes and The Dip should be required reading for anyone interested in philanthropy. While most of Seth’s writing is geared towards the marketing of for-profit businesses, his core ideas are centered around the concept of “spreading ideas.” Spreading ideas is a rather good way of describing many philanthropic goals.

Earlier today, Sasha wrote about the intersection between Renata Rafferty’s recent comments on this blog about engaging wealthy “Dinosaur Philanthropists” – her affectionate term for major donors who don’t track the inside baseball conversations about SROI, venture philanthropy and measuring outcomes – and a recent post from Seth titled “The rational marketer (and the irrational customer).

(Seth is talking about when you, the marketer, know your product is worth buying but your customer doesn’t):

You know that your car is more aerodynamic. You know that your insulation is more effective. You know that your insurance has a higher ROI.

…The problem is that your prospect doesn’t care about any of those things. He cares about his boss or the story you’re telling or the risk or the hassle of making a change. He cares about who you know and what other people will think when he tells them what he’s done after he buys from you.

The opportunity, then, is not to insist that your customers get more rational, but instead to embrace just how irrational they are. Give them what they need. Help them satisfy their needs at the same time they get the measurable, rational results your product can give them in the long run.

Sasha goes on to say that as important as the conversations about measurement are, we need to have them where the real givers are; namely the “Dinosaur Philanthropists” who give more than 80% of charitable dollars each year.

I agree with Sasha. But let’s also carefully look at what Seth is saying. He is not saying that good products are not important. He’s not saying to sell a pretty story (but weak results) to your customers. He’s saying that customers (and by extension donors) don’t make decisions based on quantitative metrics. In fact, I’d point out that for-profit investors don’t even make decisions based on quantitative metrics (they might pretend they do, but mostly they are looking for a great story based on solid fundamentals).

The discussions we’re having on the constructs of philanthropy is important. This is a field in flux and a battle of ideas is playing out around what philanthropy should be. It is a discussion well worth having. But let’s remember that none of this is important if the end result is an academic set of “best practices”. Everything that we’re talking about only matters if we can “spread the ideas” that we’re talking about.

Charity Navigator once successfully spread the idea that overhead expense ratios were the end all and be all of charity evaluation. Even if that wasn’t their intent, that idea was spread so that even “Dinosaur Philanthropists” bought into the concept. The “overhead expense ratio idea” is probably the most successful meme in the history of charity evaluation. It is what Seth Godin would call an IdeaVirus. Charity Navigator is now busy working on spreading a new idea. The idea that “outcomes” are what matters when picking a nonprofit to fund.

The key to an idea that spreads is not that it is a “good idea”, but that it is well packaged. Let’s make sure we work out great ideas on how to practice philanthropy and then package them up even better.


  1. Well said, Sean. I wholeheartedly agree.

  2. David Svet says:

    This is a great post. Thank you.

    I think you’re right about how investors and philanthropists invest — solid fundamentals and a good story. The investment world is all about the minutia of fundamentals and the NPO world is all about a good story. They could each use a healthy dose of each other’s methods.

    I don’t think I want CN to decide what the magic formula for outcomes should be as outcomes will be wildly different for vertical NPO categories and individual missions. However, there will probably be no backing off from having to deliver outcomes in a meaningful manner — I think it’s a generational need for Millenials. It may be wise to be the first NPO in the category to do it well.

  3. I don’t think CN should decide either. There is no magic formula. But I do think that CN has the potential, given their 5 million annual visitors, to shift the way donors think about giving.

  4. Seth Godin says:

    Good stuff Sean


  5. George Overholser says:

    In my experience, it takes tens of thousands of dollars to truly evaluate the quality of impact and outlook of a prospective grantee. For this reason, the vast majority of check-writers simply can’t afford to be “scientific”.

    I also believe that “positive giving experiences” are a critical part of the value that a nonprofit can bring to a community — WHETHER OR NOT THE PROGRAM HAS STRONG IMPACT.

    Is perhaps the key to have a system whereby a small number of big check-writers act very scientifically in their choices, and then pay the bills while their chosen enterprises learn how to create the giving experiences that will ultimately allow those high-impact programs to flourish and grow?

  6. Seth,
    Glad you approve, would love to see the big foundations thinking about your ideas.

    In financial markets, company research is very expensive to access. There’s no reason to share this valuable info with people who don’t pay.

    However, it is in the best interest of funders for nonprofit evaluation to be shared. So shouldn’t a model emerge where “tens of thousand of dollars” are spent on evaluation, but the results are available to all? So that even smaller donors who didn’t foot the bill can act on the research?

  7. Teri Behrens says:

    There’s a key difference between attributing social outcomes to nonprofits’ work and attributing success in for-profit enterprises. Rarely do funders provide the level of resources it would require to do the level of research that would “prove” effectiveness — as noted by George. I think there continues to be a belief that big foundations are sitting on huge repositories of information about grantees’ performance. In fact, much of what foundations have is grantee self-reports on outcomes.

  8. In the for-profit field, it can be proven that an organization’s past actions were profitable, but it can never be proven that an organization will continue to be successful (ie. profitable). Proof isn’t need to make effective investments, just compelling evidence.

    Teri, that’s a good point regarding the mistaken belief that foundations have a big repository of information. But they do have institutional knowledge. If you ask a program officer at a large foundation that does education funding to make a list of the best/most respected/etc education focused nonprofits, they should be able to produce a list (not a proven list, their opinion). That institutional knowledge would be hugely valuable if it could be captured and offered in a usable format to the public.

  9. RE: CFC Campaigns & “Dinosaur Philanthropists”

    In case you’re actually looking for some of those “dinosaur philanthropists” to donate to your non-profit, you might want to look again at workplace giving campaigns.

    Even in the current stressful economic climate, the world’s most successful workplace giving campaign, the Combined Federal Campaign (CFC) has had good results, please see some of the headlines at the end of this post.

    Even if it’s not the latest web-based giving widget, the CFC does have one fundamental factor in its favor – it works. If you’re actually running a non-profit in today’s economy and are looking for potential reliable revenue stream, my recommendation is that you take a look at the CFC. Through the CFC, Federal public servants have donated more than $1 billion dollars over the past five years to thousands of local, national, and international non-profits. CFC funds are unrestricted, reliable and predictable.

    If you are responsible for a local non-profit, please visit to determine what organization is the PCFO (local CFC campaign manager) in your region, since there are more than 200 regional CFCs. The deadline for national non-profit applications has already passed and the local deadlines vary from January 30th in the National Capital Area CFC (the largest) to March or April for many others.

  10. George Overholser says:

    Thanks, Sean, for your comment about the sharing of information. The type of information I was thinking about is not scientific proof of impact, which actually takes hundreds of thousands if not millions to know.

    I wsas thinking about the knowledge needed to know whether or not an enterprise makes for a good investment of growth capital. This includes not only an assessment of program impact (which is largely judgmental in the absence of formal evaluation data) but also assessments of management team, strategy, culture, business model, competition, plus much more.

    Indeed, for public companies which are very sound and of “investment grade”, there are analyst reports that share these “inside the company” assessments. But for private companies, which are still early in their progression towards being fully sound, information like this is rarely shared widely, for fear of spooking the customer marketplace. In the private equity world, there is a dichotomy. The equity investors get intimate knowledge of what’s going on — but the open marketplace is somewhat shielded. I think this level of discretion (with stewardship) is helpful.

    A totally different world of information-sharing has to do not with how viable an enterprise might be, but with how effective its products and services are. This is the province not of analyst reports, but of things like Consumer Reports and CNET — the type of reports that I would love to see come to the fore in our sector, once enough growth capital has been deployed in the enterprises for impact study results to be shared.

  11. RE: Consolidating expert knowledge (in regards to post 8)

    Nonprofit Knowledge Network is working on exactly what you’re talking about – effectively capturing the knowledge of program officers (and other experts in the nonprofit sector) and displaying info in an easy-to-use format.

    We’re in the final stages of developing our Beta Prototype. Below I’ll give a brief description of our initial product offering.

    If this sounds like something you would be interesting in seeing or would like to be included in our Beta launch, please send an E-mail to me at

    Nonprofit Knowledge Network is a web-based product in which users are able to select the social causes they care about, view which nonprofits in each social cause are most consistently recommended by experts as top-performing, review proprietary information about each expert-recommended nonprofit, donate to as many of the nonprofits as they want in a single online transaction, and stay current with the nonprofits? progress through regular update e-mails.