The Second Great Wave of Philanthropy

Wave My first blog post, in October of 2006, coined the phrase The Second Great Wave of Philanthropy. In the years since, I’ve used the phrase much less frequently primarily because if you were going to assign a “Wave Number” to philanthropy, we’re probably in wave 5.2 or some other number which better recognizes the multiple phases that philanthropy has gone through.

Still, the underlying concept of the Second Great Wave thesis is valid in my opinion. Today, I’m republishing my first blog post as background for a guest post from Sokunthea Sa Chhabra of the Case Foundation in which she lays out the ongoing mainstreaming of philanthropy, a critical element of the Second Great Wave thesis. You can find Sokunthea’s post here.

The Second Great Wave
Originally published October 12, 2006

Welcome to the Second Great Wave of Philanthropy. We are in the midst of a major cultural shift in the way Americans participate in the world of Giving. Over 100 years ago, Andrew Carnegie launched the First Great Wave of Philanthropy with the publication of Wealth, his 1889 essay on the importance of philanthropy. With his urging, many of his peers began to think about organized philanthropy in a new way and set up large private foundations to execute their vision.

Today we are in the early stages of The Second Great Wave. The First Great Wave was led by a small group of ultra-wealthy individuals who created enormous bureaucratic entities that supported government efforts to build such infrastructure as libraries and hospitals. The leaders of The Second Great will be you. You and your neighbors, and the family down the block. Entrepreneurs, middle managers and millions of retiring Baby Boomers will lead the Second Great Wave. Rather than supporting status quo projects, the donors of the Second Great Wave will primarily be concerned with funding entities which promise to bring new approaches to solving social problems.

This blog will be a chronicle of The Second Great Wave. It will delve into the people, trends, technologies, strategies and tactics that are shaping the new definition of philanthropy. The Second Great Wave is happening now. You and I are not just along for the ride, we are shaping the way that the wave unfolds and how deeply its effects are felt across the nation. As someone who cares about Giving, you know how profound the experience of giving back to your community can be.

At its core, this blog will be about you.

What’s Different This Time?

During the last 100+ years, much has changed in the world of philanthropy, but the dynamics of giving have been simply an extension of the First Wave. The First Wave followed a hierarchical structure of a few concentrated pools of wealth making grants to a large base of needy causes. Philanthropy wasn’t the only discipline to follow this model. Corporate organization charts, information distribution systems and political systems all followed this model.

However, as we embark on the 21st century, the traditional hierarchical system structure is collapsing. While the traditional top-down hierarchical system describes the way Rockefeller’s foundation distributed grants to charities, which then provided services for the public, a flat structure is the model of the Second Great Wave.

This shift acknowledges that no one person or entity has all the answers and instead leads to a virtuous cycle of information feedback. The philanthropists of the 21st century will be smaller in size, but much larger in numbers than the philanthropists of the last century.