In early 2007, Carla Dearing, then the CEO of Community Foundations of America, wrote an op-ed in Worth magazine titled, “The Schwabification of Philanthropy.”
Today, donors bring increasing expectations to their philanthropy, including the need for complete information, varied opportunities for involvement and full accounting of outcomes. As a result, a new philanthropic strategy is emerging. In a nutshell, it concerns itself with the question: What does it take to leverage limited charitable resources in ways that address the overwhelming needs we face as a global community? For many individual donors, it includes the question: How do I apply the same level of savvy that enabled me to amass wealth in the first place to my charitable giving?
In theory, foundations should be obvious allies for donors who want to develop their own philanthropic strategies… This group has honed approaches to address diverse challenges and communities over many decades. While foundations have undoubtedly produced great triumphs, they have also produced mistakes that neophytes could avoid. Unfortunately, even the best foundations tend to operate in tightly closed systems where such comprehensive information sharing is not valued.
…The “Schwabification” of Philanthropy: It is only a matter of time before some entrepreneur or institution takes a page from Charles Schwab and empowers people with information in the philanthropic marketplace. While the Fidelity Charitable Gift Fund and its imitators are making donor-advised funds cheaper, the next round goes to the company whose infrastructure delivers real value to philanthropic strategists. Schwab revolutionized the financial market by disintermediating stockbrokers, who had been able to charge high prices by hoarding information. Look for the same principles to apply, especially within public charities.
Yesterday I suggested that packaging and distributing this “value added information” would be a highly leveraged, high impact, philanthropic activity. Today, Tony Wang, an employee at Blueprint Research & Design who helped Paul Brest write part of the book Money Well Spent, absolutely knocked my socks off with his follow-up blog post. What Tony is talking about is The Googlification of Philanthropy.
Tony writes (you should really read the whole post):
Google revolutionized how we find and access information – but that’s only half the story. Google also revolutionized how we create and share information. As the dominance of Google increased, so did the number of people who tailored their search results for Google’s search engine (what industry people call “search engine optimization”). Google didn’t think, “Let’s try and contact everyone to give us their documents and we’ll reorganize the information” but instead thought of a way to provide a tool that takes unorganized data and makes it more relevant to the person looking for information – with the consequence of people making their information more organized and relevant.
But the most interesting effect of Google and its relation to philanthropy is its effect on the evolution of conversation. For the most part, people read blogs only if they’re relevant and blogs only become relevant if they produce highly useful information. Thus, blogs like Tactical Philanthropy and Philanthropy 2173 have come to dominate the philanthropy blogosphere arguably because of their relevance – but more importantly, they illustrate how people now have an incentive to produce highly useful information as competition for attention increases. The more useful the information you produce, the more likely people are to listen to you – and in theory, the greater your impact.
I’m hoping that philanthropy recognizes the importance of its knowledge assets in addition to its other assets as an institution and as a grantmaker. And I think one way foundations can use their knowledge assets better is by creating a more efficient marketplace of information that provides the right incentives for people to provide highly useful information. And I think that search can be part of the answer.
But Tony’s no armchair theorist. Tony’s gone ahead and started building a tool that helps move the needle. Using Google’s Custom Search tool, which allows individuals to create a version of Google that search a defined set of resources, Tony has built Philanthropy Search. Currently the site indexes 114 websites including top philanthropy media outlets, university philanthropy research groups and the websites of the top 100 foundations. You can see the full list of indexed websites here and you can test drive Philanthropy Search here. Tony is actively soliciting feedback on additional sites that should be added or suggestions for improvement.
Quickly testing the search term “global warming” shows that using regular Google, you get almost exclusively links to government agencies and mainstream press reports whereas using Tony’s Google-powered Philanthropy Search you get links to philanthropic research on global warming and philanthropic media reports of global warming related grants and programs.
The Schwabification of Philanthropy was about lowering the costs of administering philanthropy and thereby giving tools to individuals who want to take control of their giving. The Googlification of Philanthropy is about organizing philanthropic knowledge to allow for smarter giving. Most importantly, the Googlification of Philanthropy means that organizing the information will not be done by the information creators, but by third parties and – excitingly – the users of the information themselves.
What is meta-data to web pages will hopefully become standardized reporting/transparency for nfp’s. (Note: Marc Cuban has some cool thoughts about XML for financial reporting http://blogmaverick.com/2008/12/16/the-sec-madoff-and-xbrl/)
The hope would be that it cuts down on all the customized reporting orgs have to do for each foundation. It requires an EXTRAORDINARY amount of computing effort to pull together everything requested by many/most foundations. A huge cost.
I can’t stand all the info foundations ask for. On the flip side – I believe they’ve added more and more in an effort to try to understand what most orgs really do.
I think that investors (for-profit and philanthropic) will always have their own unique questions they want answered. But the shift that can occur is that investors can find the info they are looking for rather than ask for the info they are looking for.
The XML effort you’re talking about would make it much easier for investors to parse standardized data in customized ways. Thanks Nick.
I take issue with the assumption that the Googlification of Philanthropy would be a net gain for our sector.
Google has a knack for organizing and ranking information, but please keep in mind that they don’t share their secret sauce quite to the degree that philanthropy professionals would demand.
Our field needs transparency and openness on all fronts: transparency and openness about which grants work and which ones fail, transparency and openness about the operations of nonprofits, and most importantly, transparency and openness regarding the ways in which we filter, rank and sort information about the philanthropic marketplace.
We can trust blindly Google to add coherence to the information we generate about nonprofits and grantmaking… or we can enter into a long-term commitment as a sector to build our own open-source and co-created infrastructure for making smart decisions about giving and nonprofit operations. The second option has my vote.
The Mozillification of Philanthropy: now that’s something I could throw my full support behind.
Peter, I’d like to play Devil’s Advocate for a little bit and ask you: Do you use Google? I imagine you do. Has its lack of transparency and openness driven you away from its services? Why not?
My point in asking these questions is to point out that in the end, it’s less about ideology – nonprofit vs. for-profit, open-source vs. proprietary – and more about what works – and quite frankly, Google works. Until there’s a nonprofit and transparent version of Google that can index the world’s webpages, provide instantaneous search, and customizable features, I’m going to have to go with the third, low-cost option – which is to create a search engine with as much transparency using Google’s technology (I even used Google Docs to publish the sites that are indexed in the search engine).
I’m scared that we’re going to let the perfect be the enemy of the good here and that we’re never going to make progress when we insist to do things in the most idyllic way possible when there’s a perfectly practical solution in front of us (reminds me of foundation grantmaking sometimes!). So let’s all recognize that this tool isn’t about Google and advocating secrecy, but it’s more about thinking about search, PageRank, and increasing the efficiency of and incentives in the marketplace of ideas.
Uh Sean, there’s been a Google CSE search for the nonprofit sector since October 2006. It’s at http://www.google.com/coop/cse?cx=017112442565914832703:is9f5fkkjce
There are 268 sites in it and it’s grouped depending on the kind of user you are (techie, philanthropist or nonprofit staff). People have been using it for social science research apparently over at the Arnova-L list. You can even add the search engine to your browser.
Very cool Allan. I think Tony is building something different. But that’s the beauty of custom search engines, you can have multiple engines for different purposes. I think Tony is trying to build a tool that will specifically help people doing research on philanthropic programs.
Thanks for your post and your provocative (as always) questions about Google. I think there is a two part answer to your question:
1. Many of us are already leveraging Google’s services to make our nonprofit organizations do a better job of harnessing the power of the Internet. I predict that a majority of big nonprofit sites will be using Google mapping services before the year is out, for example. We love Google Analytics and Google Ad Grants. And, as social networking and video services like YouTube take off, we’ll be using Google even more. It will become indispensible to our operations.
2. Search is a different matter. Search assumes there is something to find. And when it comes to nonprofit data, the reason Google doesn’t have much to offer is because there isn’t much meaningful there. We recently released a survey of 2,000 nonprofit organizations(http://publications.guidestar.org/) and found that although many nonprofits are using the internet in some way, only 43% posted annual reports and only 13% posted audited financial statements. The nonprofit sector still has a long way to go before it embraces transparency. As a result, the bulk of GuideStar’s efforts go into managing and cleaning nonprofit data we aggregate from a variety of IRS and nonprofit sources. We don’t see that need going away any time soon. In addition to making all this data available on GuideStar we also partner with nearly 25 other sites. In other words, the sector is slowly moving to your “superior knowledge” sharing idea but perhaps not as fast as we would all like.
I hope my post didn’t imply that Tony’s project was the first to use Google tools. My point was that in addition to “Schwabification”, philanthropy is going through a process of organizing and optimizing relevant information and that this process will have a profound affect on the field.
Groups like Fidelity, Schwab Charitable, Network for Good and Foundation Source are driving “Schwabification”. Guidestar is, of course, one of the major groups driving Googlification.
Thanks for your thoughtful reply to my comment. This conversation has hit a nerve with a number of groups (Guidestar, Social Actions) for the simple reason that we are nonprofits building out infrastructure that is dramatically improving the quality of information that people have access to when making decisions about their philanthropy.
Leapfrogging the initiatives that are already underway within our sector, and dreaming instead of a purely Google-powered marketplace of information about nonprofits and philanthropy, is the cause for concern.
My appeal for openness and transparency was more a reaction to the title of your and Sean’s posts than a reaction to what you have built.
Your custom search engine is a valuable tool, and leverages a subset of Google’s existing universal search for the benefit of philanthropy researchers and professionals. The Philanthropy Search you created is exactly the kind of use case that Google had in mind when building the custom search engine utility.
I’ll have to write a follow up post to clarify my thoughts. Just as the Schwabification of Philanthropy was not an argument for Schwab the company to dominate philanthropy, the Googlification of Philanthropy is not arguing in favor of Google the company.
Schwabification refers to the way that driving down transaction costs transforms a sector. Googlification refers to the way that organizing information and making it universally accessible and useful will transform our sector.
I’ll look more deeply at this in a future post.
Thanks Peter for extending the olive branch. I agree with your overall point that transparency is important. Though the tool isn’t built with open source tools and uses Google’s proprietary technology, in my most recent blog post, I agree with you transparency should be one of the key design principles of the project:
Sean, I definitely agree with you that Googlification as a way of organizing and making universally accessible information in this sector is an important trend. I think what’s getting misinterpreted is the idea that this search engine is somehow THE solution. I agree with many of the commenters here like Bob and Allen that it’s simply one solution among many – the search engine certainly doesn’t replace the function of groups like The Foundation Center, Guidestar, and Charity Navigator. Nonetheless, I still think Philanthropy Search does solve an important problem that hasn’t been addressed by any existing solution.