What are you guys working towards long-term in terms of philanthropic goals? How do you typically pick what to get involved with? Anyone sit on boards/get involved in the day-to-day of any charities or do you think it's a better time/value for society by simply donating cash and using your time to generate more capital for the charity?
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I definitely don’t want to donate to anything mainstream like the Red Cross or some shit. I want to find opportunities that have a high return on investment or can contribute to something huge that others fail to address.
Yeah definitely. I love Gates approach on running research to figure out how to optimize spend prior to going in and spending. He truly runs it like the god-tier entrepreneur he is...maximizing every dollar spent. It's amazing he managed to wipe out a disease in such a short period of time!
Edit: Meant to post this as a reply to your response below, I must've hit reply on the wrong post.
That's pretty cool. Did you first narrow down by the causes which interest you and then look at charities, or did you just start with everything on the table?
Also, if you want a quick and easy way of finding organizations that have already been heavily vetted (including a longass due diligence period approaching PE levels), take a look at the winners of the Google Impact Challenge. I know the organization which manages the winners portfolio for them and they're doing a pretty good job.
My current approach is probably not for everyone, but here goes. Couple years ago I turned a student-initiative into a national not-for-profit and have been leading it since. It is not easy balancing it with a full-time job, so would definitely not recommend this approach unless you find an area that (1) you're really passionate about, (2) serves a large enough chunk of the population, and (3) is not being addressed by anyone else.
I call this my "current" approach because the long-term goal (hopefully within 3-6 years) is to hire a full-time managerial team and let them run the day-to-day while I guide the direction and facilitate introductions through the Board.
Regarding just donating cash, objectively speaking, I hate the legacy model of relying on donors and spending money on the cause without tracking any sort of ROI (short-term effectiveness and long-term efficiency of capital allocation). There are a few not-for-profits and social impact enterprises which have finally awoken to the fact that finance guys love tracking the performance of their money. They now use a two-pronged pitch - the cause, and the efficiency with which they are achieving/attacking the cause.
I'm giving all this info because if you'd rather just donate cash, I'd recommend looking for organizations which track how well your money performs. A good example is Right to Play (absolutely love how well they track their efficiency on so many metrics).
Definitely. Have been evaluating a few different charities for a huge donation (for us anyways!) one if my companies is organizing EoY. Crucial to make every dollar count.
Philanthropy is great. There are a couple of rules that I hope you will follow if you decide to donate your capital:
a) Donating doesn't make you a better person
b) Be careful about bragging rights
c) It is never an excuse for bad behavior
Philanthropy is using your resources to make the world a better place. Don't give to Africa and cuss out your server. Each encounter we have is also a chance to make the world a better place. Don't pass up the opportunity in front of you because you were late for a meeting, but its ok because you gave six million dollars for new irrigation systems in Liberia.
I know everyone's heart is in the right place on this thread and its great to see, but the day-to-day is the most challenging for everyone. One moment can make or break someone's life, especially people in the service industry who really struggle check to check.
I would encourage those donating in philanthropic ways to also try to donate at least a few hours per month (or year minimum) to hands-on activities. You don't want to become detached; if time is your most valuable asset, demonstrate the value you are willing to place on others with your time. What do you value in life? If you've ever seen a millionaire or billionaire doing something out of the goodness of their heart, you realize the essence of life and it is not only a good lesson for you watching them, but for them, 'getting their hands dirty' and brushing up against the cold hard truth of real suffering in life.
Most of my friends who made money on the street became condescending assholes, buying their way to their desired result. It pains me at times to see this - for the people I have known for a long time. I'm hoping you monkeys can see the light of your decisions and proceed in a path where you can make money and help others, without saying 'fuck you' on the way out, for pride.
"Each encounter we have is also a chance to make the world a better place." Incredibly well put friend. +1
Does anyone have any experience with donor-advised funds? I'm nowhere near wealthy enough for that to be useful to me yet but maybe for some on this site it could be an option if anyone has any insight.
only really worth it if you have highly appreciated assets the DAF will accept. I wouldn't give them cash. we use them for execs with concentrated positions where a family foundation/CRT/CLT isn't appropriate and they want to pre fund their philanthropic goals during a big income year (big stock option exercise, company gets bought and stock gets taken out, etc.)
When I graduated from college and moved to a new city (smaller big city in the Midwest) last year, I wanted to get involved and so reached out to a handful of non-profits seeing if they would take me on their board. A few were full or weren't looking for new trustees, but two smaller non-profits wanted me on their board. Since then I also joined an associate board of a non-profit venture capital firm as well as an associate board of a larger, slightly better known non-profit. Here are a few things I've learned:
I personally don't like fundraising. I thought I would be fine with it but when 70% of board meetings or committee meetings are focused on fundraising, I'm beginning to grow a little jaded. I just hate asking others to donate money or time, I feel like I am intruding on their lives.
The two boards I am on are composed of average people with average jobs. In my opinion it is tough to leverage this to really hit fundraising numbers or establish a good network (both for myself and for the non-profit). The regional president for my company is exactly the guy you want, he has money, influence, and many connections. Most of the people I serve on boards with are not this guy.
I am far too involved to be an effective board member, and here is why: when most of your value comes from your network, it becomes tough to determine which events to push to your network, especially if there are numerous non-profits you are involved with. Political or relationship capital is very valuable and I only want to tap into it for causes I care deeply about. Not to say I don't care deeply about the boards I serve on, but often the events they plan don't hit that threshold.
I'm beginning to think the current non-profit model is outdated. This ties into what one of the earlier replies said, but just donating money to an organization with loosely defined goals is a pretty outdated way of thinking. I also find it frustrating that fundraising makes up about 10% of these non-profit budgets but we spend 70% of our time thinking about how to fundraise better. The ROI on our time spent would likely be better focused on finding more sustainable methods of revenue. Furthermore, people always want something in return. The old model has a key assumption that the feel-good feelies people get from donating is enough to prompt people to donate. In today's society, however, I think there needs to be something more in return, whether that is social recognition or something else.
I really enjoy serving on the associate board of the VC firm because it involves zero fundraising and really is just strategy on how the firm can better serve the market / entrepreneurs. I find this to be way more enjoyable, and it certainly helps that the people working at that firm are like-minded business people and generally are more structured in how they think about problems.
I read a book called Doing Good Better and it really helped me think about altruism in a new way. The central argument is basically this: there are some causes where you can make 10-1000X more impact based on the nature of the focus. The example used is mosquito nets, which cost around $2 each, and might possibly prevent a death. Compare that to donating $2 to the Red Cross. I would recommend reading this book.
When it comes to the non-profit world, similar to the finance world, there are buy side and sell side, except in the case of the non-profit world it is ask side and give side. There are foundations that routinely donate to both non-profits I work with, and man it would be nice to be on the giving side of the money, instead of the side that is always asking for funds. If you can get involved, try to do it on the give side.
The involvement I've had so far has been so far removed from the people actually impacted it almost feels like nobody benefits. This is causing me to consider becoming a mentor for a high-school/college student from a low income family where I can see tangible impact over time. To me this might be far more rewarding than just working through the month-to-month operations of a non-profit.
I know that was a lot but that is simply what I've observed over just the past year serving on boards. If I were you, I would consider joining one board you feel strongly about while donating money to other causes that might interest you. Hopefully this was helpful.
NYC: Philanthropy, Voluntarism, Charity (Originally Posted: 03/05/2012)
Looking to get involved in some PVC in NYC. Any recommendations or ideas?
That was incredibly informative. About your point on see how efficiently charities use donations for their stated purposes, do you know about any ways to track transparency and efficiency like that?
I know there are a number of sites out there that provide statistics on which global poverty focused charities are the "best" (https://www.givewell.org/charities/top-charities). Furthermore, Charity Watch, Give.org, and Charity Navigator all provide information on the finances of non-profits. You also can individually search any non-profit's 990, which is what they report to the IRS (https://apps.irs.gov/app/eos/). I've found this to be a pretty nerdy way of digging through but can tell you how much a non-profit spends on fundraising (a lot!) or what sort of lobbying they do. That is probably the purest way to dive into the financials of a non-profit.
Do a search. Someone asked the same question last week
This is great, thanks for writing such a detailed post! How'd you end up with the non-profit VC firm? I've been trying to nudge my way into that world but haven't had much luck yet. Venture philanthropy has been going in and out of vogue since the 90s but it'd be interesting to get an insider's perspective.
I had reached out to one of the higher ups at my company who sits on their main board, told him about my involvement in the non-profit world, and just so happened the VC was looking to build an associate board and reached out to board members for recommendations. I had an informal chat with the company reps who were spearheading the project and they liked me.
I wouldn't call it venture philanthropy, however, as they engage in very similar deals to an early stage VC. It just happens that they do provide some free services to entrepreneurs and have maintained the non-profit designation for one reason or another.
Out of curiosity, why did you even join those boards? You don't like fundraising and you don't like imposing on other people's time and/or wallets, and that is basically the only function of being a board member. It sounds like you wanted the prestige without the accompanying responsibilities? The entire post makes it sound like you would have been far better served actually volunteering for the day-to-day of the organizations in question, and would still be better served to resign your position on the board and do something that feels more meaningful.
And you're right, hence why I wrote out what I learned. I also was wishing to donate my time and knowledge, less so a focus on fundraising, just turns out that I should've vetted the boards a little more to really understand what they spent their time on. Again, a learning experience hence why I am sharing it here.
To answer your first question, I was brand new in a city not knowing anyone and decided getting to know people serving on these boards might be a first step in the right direction.
I sit on three boards. My views tend to be different than how some of the other board members think things should be run. My focus is on bringing some ideas back down to reality, increasing the overall efficiency of the organization, and getting the most return on donor funds.
I don't want donors to think their donations are being wasted on nonsense and salaries.
Your skills and knowledge can be very beneficial to a non-profit.
I'll throw this out there. One of the biggest avenues that is often missed is giving your Time and Knowledge instead of money. You can start as small as mentoring students at your university or high school, teaching them about the importance of finding a job and how to do it, and or mentoring even a single eager student to land that IB/CorpDev/Whatever gig.
You don't need to start a fancy non-profit and put on LinkedIn of how you want to join a board...just start small, impact a single student, than scale from there.
May not seem like much but that single kid you mentor and impact will remember it for a lifetime and will probably pay it forward and so on and so forth.
Lastly fuck United Way!
This is it. Coming from a community that's favorite dick-measuring contest is to see who can write the biggest check to a non-profit, people forget how important it is to devote time to a cause instead of money. Many of my friends and friends' families like to say how they've been involved with so and so organization for however long, but that usually just means that they've written a couple checks and gone to the party the non-profit hosts every year.
I started out as a Boy Scout and was lucky enough to have leaders that understood the importance of community service, and we understood from a young age that the best way to change your community for the better is to spend your time improving it. Every month we'd spend a weekend helping some aspect of our local towns- hosting a clothes drive for the Salvation Army, rebuilding a community space that was destroyed in a fire, cooking and serving food at a food bank in the city, etc. I wish that Scouts still had the prevalence and respect that it once used to, and that leaders understood the importance and impact a well directed troop can impart. We all learned the importance of selflessness, and many of my fellow boys have gone on to be truly beneficial in our world. One is leading a firefighting division in Wyoming, others spend inordinate amounts of time tutoring inner city kids wherever they've landed, and so on. I am here in one of the poorest regions of Latin America teaching kids who've been dealt possibly one of the worst hands of life imaginable, taking a year off from college to do this. The impact my small organization of a hundred or so employees and half as many volunteers can have on these several hundred kids is far greater than the Red Cross or United Way could do, we have relationships with them that will last a lifetime, and providing personal attention, care, and knowledge is helping them prosper in life. It is that gift of time, personal, face-to-face involvement, that goes way beyond any number written on a check. And it is the most rewarding feeling in the world.
"I believe in taking care of myself, with a balanced diet, and a rigorous exercise routine. In the morning, if my face is feeling a little puffy, I'll put on an icepack while doing my stomach crunches--I can do a thousand now."
As others have said, your time is more meaningful than your money. Spend a hundred hours volunteering for an organization before thinking about going on the Board. There is less prestige, sure, but more impact, and I am acquainted with plenty of people who think that sitting on four non-profit boards and giving $50,000/yr justifies some kind of swagger about it. If you're in it to have your name on the sponsor list at the end of the year mailing, then you're probably in it for the wrong reason.
While I agree with you about volunteering vs. board impact, I think it is generally fine that some people are in it to have their name on the sponsor list.
The idea of perfect altruism is a fantasy and people have selfish reasons for pretty much everything they do, even if that reason is getting the warm fuzzy feelings that come from helping others. If non-profits only accepted money from people with the understanding the donor's name wouldn't be published or sent out anywhere, then many non-profits would cease to function. I actually think non-profits should capitalize more on tapping into this selfish desire of people in order to bring in more funding.
I think there is a real difference between wanting to feel good about helping people (whether that's by giving time or money, or both), and wanting to use a charitable enterprise to make yourself look better. I understand perfect altruism is not to be expected, but motivations do matter.
Besides which, the question at hand is how to best execute philanthropy. It presupposes that you actually want to do some good. If all someone wants is the recognition of having been involved in a charitable cause, then the answer is vastly different than if someone has a genuine desire to help in some specific area of need.
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