Every Little Bit Helps

I just read this great post from the Minnesota Council of Foundations about a new fundraising campaign of the United Way. I think that small gifts, driven by social networking, will be the new lifeblood of nonprofits. We can't keep tapping the same donors (especially since capital gains are so 2007) and expect to keep up the same level of work. The needs in our communities are greater and we to think about new ways of engaging individuals and their networks in our work. From MCF:

The Greater Twin Cities United Way is experimenting with a new way of raising money. Instead of relying on a few people to give large donations, they’re asking a lot of people to give a little — just $5.

The Give5Now campaign is a one-minute video that shows how people can use a small contribution to make a big impact:

• One person gives $5 to help people in need
• … then passes the message to 5 friends, who each also give $5
• The “ripple effect” will be felt across the Twin Cites

The simple website — just the video and a “click here to Give5 now” button — is an effort to take advantage of technology that allows individuals to spread the message on social networking sites such as Facebook and Twitter. “Giving trends show that young people, in particular, are more likely to give small donations online that respond to immediate causes,” said the United Way’s Randi Yoder.

Let's ignore effectiveness (just for today)

Image courtesy of the Star Tribune

A few days ago an apartment building near my house burned down. It was one of those tragic stories that makes you hold your family a little bit closer and count your blessings. As a nonprofit geek, it also made me think about the current financial state of the Red Cross and hope that they would be able to provide services to the 64 families left homeless by the fire just days before Christmas.  Then something completely unexpected happened, an anonymous donor gave $1,000,000 to the victims of the fire. No strings attached and with the insistence that the money be disbursed immediately, so that the families would have it before Christmas. The generosity brought tears to my eyes because all I have been hearing for the last few months is how bad the economy is and that nonprofits  and the people that we serve will be left out in the cold. This donor's generosity reminded me that giving is a basic human instinct and we will continue to support each other, especially during hard times. 

It can be argued that, especially in these tough times, there are better ways to use that money. The donor could have leveraged it as a challenge grant to get more funds to the Red Cross, they could have offered to pay two months of rent for each family (and spared the families from the tax burden and other financial implications of a cash gift), they could have started a public information campaign about the need for sprinkler systems in older apartments or the benefits of renters insurance, or they could have build more affordable housing to replace the building that was lost. They could have done a lot of things but they helped in the way that they thought would be the fastest way to meet the needs of these families. As a professional philanthropist, I often get caught up in the how of the giving. This donor reminded me that the why is even more important because that is where our humanity is.

YOU are going to fix this economic crisis (Don't look away, I'm talking to you!)

I have been battling a variety of emotions during this economic downturn. The most prevalent emotion is me feeling like the market would get better for nonprofits if I laid under my desk in the fetal position and said "I'm not listening to you public radio" over and over again. Last week was pretty brutal with the Madoff scandal (which closed the JEHT Foundation, a prominent social justice foundation that gave away $25 million a year and impacted nonprofits and foundation throughout the country). Then a local arts organization, Intermedia Arts, which creates social change through the arts, announced a massive restructure that will include closing their gallery and moving all staff besides the ED to hourly, contract positions. Earlier this month I went to an amazing exhibit that Headwaters is supporting at Intermedia Arts called Body Burden, which shows the connections between our bodies, our environment, and our modern way of life. Now the future of their arts programming is unclear.

Foundations do not have the funds, expertise, or vast network needed to get us out of this mess but YOU do. Don't avert your eyes, I'm serious. The future of the organizations that you care about and their ability to create change in our communities rests solely in your hands. This is a time where we need all hands on deck. If there is a cause that you care about, be proactive, before they close their doors. Ask one of their staff members what their greatest need is and help them get it. Use your network to find them a volunteer grantwriter, bake them cookies for their next staff meeting, offer to upgrade their website, ask your friends to give a gift in your name to the organization instead of birthday gifts, write a letter to the editor to talk about how nonprofits are an economic driver in your community, go visit a nonprofit theater instead of seeing a movie on a Friday night, buy new basketballs for your local rec center, donate your old clothes to a local clothes shelf, become a technical skills tutor so your favorite organization doesn't need to hire as many consultants, use your facebook friends and linked in connections to help the organization raise money for holiday toys, introduce their Executive Director to your foundation CEO, find them a high profile board member, be their high profile board member, ask Givewell to rate your cause, provide childcare at their next community meeting, bring their brochures to your favorite coffee shop's bulletin board, donate an item to their silent auction, ask 100 friends to donate items to their silent auction. Do something! You have everything that it takes for us to make it through this, you just have to do it.

What else can you do to make sure that our social sector exits this financial downturn in a better position than when it started?

Change the Way We Create Change by Dan Pallota

Dan Pallota, the author of Uncharitable, has a great article on nonprofit effectiveness at the Huffington Post. An excerpt is below:

...The word "profit" comes from the Latin noun "profectus," meaning "progress." Thus the term "nonprofit," means literally, non-progress. The sector remains bound by an ethos of deprivation laid out by the seventeenth century New England Puritans in a twisted effort to ameliorate the terrible reality of their self interest. It said that on this side of a line we can make a profit and on this other, which we shall call "charity," we will deny ourselves. Thus the carpenters and farmers of the world got free-market capitalism, and the needy got a religion -- charity -- in which everything that worked in commerce was banished.

By and large, it is still what the needy have today. We let people make a fortune doing any number of things that will harm the poor, but want to crucify anyone who wants to make money helping them. This sends the top talent coming out of the nation's best business schools directly into the for-profit sector and gives our youth mutually exclusive choices between making a difference and making money. This we call altruism. We let Apple and Coca-Cola plaster our billboards and television sets with advertising, but we don't want important causes "wasting" money on paid advertising. So the voices of our great causes are muted and consumer products get lopsided access to our attention, twenty-four hours a day. This we call frugality.

Amazon could forego investor returns for six years to build market dominance. But if a charity embarks on a long-term plan with no return for the needy for six years we expect a crucifixion. This we call caring. We aren't upset when Paramount makes a $200 million movie that flops, but if a $5 million charity walk doesn't make a 75% profit in year one we want the attorney general to investigate. So charities are petrified of exploring new revenue-generating methods and can't develop the powerful learning curves the for-profit sector can. This we call prudence. We let for-profit companies raise massive capital in the stock market by offering investment returns, but we forbid the payment of a financial return ("profit") in charity. The result? The for-profit sector monopolizes the capital markets while charities are left to beg for donations. This we call philanthropy.

...It is time to give charity the big-league freedoms we really give to business -- the freedom to get the best people and pay them whatever it costs for the value they can produce, freedom to buy ads on the Superbowl -- yes, at a cost of $2.6 million a pop -- to start building market demand, freedom to take big risks, and to fail big if that's what it takes to learn, and the freedom to start attracting capital in a stock market by paying investors a financial return. It's time to stop obsessing about overhead and start focusing on progress.

Read the rest here.

Resource Generation (NY) seeks ED and Do You Want to Work for Me?

Resource Generation is looking for an Executive Director. This is a fabulous organization that helps young people of wealth create social change through their giving. The full announcement is available here. 

I will also be looking for an administrative assistant and an advancement director for Headwaters after the start of the new year. If you know someone who is excited about cutting-edge philanthropy and can thrive in a Results Only Work Environment, tell them to dust off the resume. Job descriptions will be posted on this bog in the next couple of weeks.