Social Media, Influence & Dinosaurs

On Friday, Renata Rafferty wrote a guest post that resonated with a number of readers. In the post she suggests that the focus on “foundations and social venture/social entrepreneurship leaders” is misplaced and worried that “Those of “us” on the “cutting edge” of philanthropy” may be too busy navel gazing to realize that the majority of philanthropy is being practiced by “dinosaur philanthropists”; Renata’s affection term for the vast majority of donors who attend charity galas and engage in community giving without tracking the day to day issues discussed by the “cutting edge".

Renata’s post rocked. She nails one of the core elements that form my view of philanthropy. Namely, that we are in the midst of a Second Great Wave of Philanthropy in which the lead role is played by the individual donors whose giving currently makes up 82% of all charitable donations (with foundations making up 13% and corporate philanthropy making up 5%).

At this point, the vast majority of individual donations are made without regard to any sense of impact, without knowledge of how effective the recipient is, without any strategic goals in mind. The point of my post Why Philanthropy Wins in a Web 2.0 Culture, was that having influence (or controlling “social capital”) is becoming more important than controlling financial capital in the field of philanthropy. That’s because, unlike in the for-profit space where only returns on your financial capital benefit you, in philanthropy the returns on all invested philanthropic capital accrues to the public at large. That means that if you can utilize your social capital to influence how money flows in the sector, you can have a larger impact than you ever could investing your own philanthropic capital.

The large foundations are natural “thought leaders” and should be able to take the lead in influence. But only if they recognize the power of sharing information (as a way to achieve impact). The rise of social media tools means that you do not need a large amount of financial capital to leverage your social capital. The costs of sharing information (which is a highly effective way to influence decisions) has dropped dramatically due to social media tools.

What Renata’s post misses, in my mind, is that focusing on social media/large foundations/cutting edge philanthropy is not to ignore the vast legions of individual donors. There is no such thing as “old” and “new” philanthropy. It is all real dollars being put to the purpose of good. The real clout, the real money is with the individual donors. But the leaders of this field, the ones who help influence the way philanthropy is practiced, will be those who understand that sharing information has entirely different ramifications in philanthropy than it does in the for-profit field. Understanding those ramifications is the key to understanding the Second Great Wave of Philanthropy.


  1. Here I go, beating this dead horse again …

    “The large foundations are natural ‘thought leaders’ and should be able to take the lead in influence.”

    “Thought leaders”? Of whom? Other philanthropod navel-ponderers perhaps
    (and I mean that with all due affection for the important role foundations play in our society).

    Foundations, as thought leaders, preach to the choir and born-agains of our sector, but they certainly have very little influence on that huge population of donors among whom I dwell, the dino donors.

    So, once again, this Little Red Hen is asking “Who will help me plow the dirt, plant some seeds, patiently water …”? Seems those philanthroleaders with a heavily XBox (or twitter,FB,LI,MS) mentality don’t seem to understand that creating a new video game for dino donors … is a game those donors will not even know exists.

    I am taking an extreme position to make a point: that we still have no effective means (or seemingly reasons), for connecting with the major donor population today through means (and with a message) that is relevant to THEM, that speaks — at their level — to how and why they can adjust their approach to their own giving in a way that changes the world to be a little more like the way they want to see it.

    Again, we can’t just chain ’em to a Harley and expect they’ll know how to ride if they haven’t even seen a bicycle — while the rest of us Harley riders tell each other how great Harleys are.

    Still allowing me in the sandbox? 😉

  2. Adin Miller says:

    Sean and Renata, I’m enjoying and learning a lot from your dialogue. Please keep it up…here’s my question: is there a regional difference that we can apply to “dinosaur philanthropists” or individual donors? For instance, my uneducated sense is that donors in Silicon Valley are probably a bit more in-tune with the ideas of transparency and impact.

  3. Renata, I’m not saying that foundations are doing a good job leading, but that they are naturally positions to lead. So far they’ve done little to influence the actions of major donors. But they are naturally positioned to take on that mantel if they so choose.

    One of the reasons I’ve written so much on the convergence between wealth management and philanthropy is that your dinosaur philanthropists all have wealth managers. It seems likely to me that this is the best point of delivery for philanthropy advice.

    I would guess that there is some geography differences, but even in Silicon Valley, most major donors know little about many of the issues we debate here.

  4. Sean, I would disagree that foundations are in a natural position to lead … there are too few point of intersection between foundations and the donor population at issue.

    I absolutely agree with you that wealth managers and advisors are the best point of delivery for philanthropy advice. Now we just have to get to the dinosaur advisors! 😉 That’s where much of the focus of my work has been for the past three years.

    Hearty agreement! Yay!

  5. Wealth managers are the point of delivery, but for the most part their skill set does not set them up as natural philanthropy advisors. So where does the “advice” come from (even if the delivery is via the wealth advisor?)

    Great conversation by the way!

  6. The advice comes from philanthropic advisors, such as myself, who are not looking to steal a client, manage their assets or sell a product.

    Speaking of products, my bodaciously-titled book will be out soon. I wrote it specifically for advisors, their clients, donors looking to “do it better,” etc. Will it do the job? It’s a start.

    Local networks of planners looking to become more philanthropy-savvy are popping up around the country.

    The International Assoc. of Advisors in Philanthropy is making a valiant effort to educate planners and advisors.

    These are all drop-in-the-bucket initiatives, but at least a start at trying to reach the dino donors with the very important message that they CAN make change in this world more effectively than they are right now.

    Maybe we need Sylvan-type learning centers for donors and advisors?

  7. I love the back and forth, here, but sure wish we can expand the circle and bring in the dinosaurs and let them sound off, too.

    We’re good at convincing ourselves of what we already know and believe. Now, to the barricades.

  8. Re: Sean’s statement that foundations are in a natural position to lead and Renata’s response.

    Reality and perception do not always jive, and that is why foundations are indeed in a position to lead. Renata is correct that there is no connection between foundations and real live donors. Further, we all know that foundation giving is a tiny fraction of individual donor giving.

    That said, however, foundation (and government) giving is the only giving with rules. As trends appear and take hold, those rules tend to become uniform across almost all foundations and government grants – the trend towards grant applications all asking for collaboration or measurement are good examples.

    Because they are the only donors making rules, organizations go where the rules lead them. So if we want to change systems, even though it feels like the tail wagging the dog, we need to change how foundations view things. Whether it is justified or not, they are the influence-makers in the sector.

    Ok, back at it you two!

  9. The power of the ppl still wins the day when it comes to philanthropy.Good post..

  10. The power of the ppl still wins the day when it comes to philanthropy.Good post..

  11. The power of the ppl still wins the day when it comes to philanthropy.Good post..

  12. Hildy, it’s clear that foundations are “influence-makers in the sector,” but who or what are they influencing, and is that influence, ultimately, progressive in terms of turning more (or a majority of) charitable dollars into more social change? Or are foundations only the big(gest) fish in the relatively small “organized philanthropy” pond?