Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence! Presented by Allyson Reaves July 11, 2008 International Society for Third Sector Research 8th International Conference Barcelona, Spain Via XX Settembre, Torino, Italy

Problem Statement Limitations in Traditional Grant-Making Time Amount Purpose Foundations, particularly those with a local focus, have a diverse collection of resources, that, if packaged and presented creatively, can provoke social change larger than just the effect of its financial contributions. Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

Purpose of the Research Little evidence, testimony, and criticism is available for foundations that are more local in focus about creative tools of philanthropy. Foundations with a Local Scope New tools of Organized Philanthropy Venture Philanthropy Entrepreneurial Incentives Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

VENTURE PHILANTHROPY EXPLORED GOAL: To impact systemic change in a specific issue area ACTION: Align with fewer yet targeted non-profit organizations GOAL: To make large scale investments ACTION: Offer higher levels of funding GOAL: To provide a comprehensive portfolio of services ACTION: Maintain staff with finance backgrounds and familiarity with the 3 RD sector GOAL: To participate in ongoing development and engagement ACTION: Require extended grant periods that include real-time involvement Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

VENTURE PHILANTHROPY EXPLORED TOOLS NEEDED Duration – Long Term – 5-7 Years Research and Investigation – Foundation’s Focus – Organizational Capacity Funding and/or Financial Leveraging – Multi-million dollar range – Ability to Absorb the Approach ORGANIZATIONAL INPUT Silicon Valley Community Foundation – The Center for Venture Philanthropy Established Partnerships Local Focus Fondazione CRT – Sapere Donare- Uno-per-Uno – Fondazione Sviluppo e Crescita- CRT Sector Collaboration Investor Partnership Evaluation Systems Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

VENTURE PHILANTHROPY EXPLORED CHALLENGES AND RECOMMENDATIONS WITHIN VENTURE PHILANTHROPY FOR FOUNDATIONS Technical Jargon –Remove the language of the business world –Create a relatable and clear dialogue Evaluation Culture –Provide resources to support evaluation activities –Build a culture of evaluation through ongoing discussion –Perform a public self-evaluation Clearly Defined Social Objectives –Decide what to accomplish and the areas to impact –Identify a specific area related to a social issue, organizational area, or operational growth –Align resources to support organizations in these areas –Place a significant investment behind this strategy Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

ENTREPRENEURIAL INCENTIVES EXPLORED Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

ENTREPRENEURIAL INCENTIVES EXPLORED TOOLS NEEDED Marketing and Publicity Management and Administrative Support Human Resources Regarding Issue Areas ORGANIZATIONAL INPUT Case Foundation – Make It Your Own Initiative Individuals Involved Evaluation Tool Localized Action X Prize Foundation – Various Competitions Prize Goals Attractive Philanthropy Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

ENTREPRENEURIAL INCENTIVES EXPLORED CHALLENGES AND RECOMMENDATIONS WITHIN ENTREPRENEURIAL INCENTIVES FOR FOUNDATIONS Legal Issues –Take extra precautions in selecting the individual recipients Criminal background and credit checks –Use a model where the individual applicants partner with a non-profit organization Working with Timelines –Utilize the field for ideas on the best combination of programmatic design elements including the guidelines, grant award amounts, and project timelines. Regulating Applicants –Incorporate a nominating process –Exercise an effective system of regulating applicants so that applicants’ time and efforts are well respected Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

CONCLUSIONS ENCOURAGE NEW SOLUTIONS AND THINKING IN THE 3 RD SECTOR Venture Philanthropy – Build the infrastructure of an organization so that it can focus on its mission – Enable the organization to focus on the provision of services – Fuse human, intellectual, and operational resources – Propel the organization to a level of affecting change in the way that its mission intends. Entrepreneurial Incentives – Encourage new solutions by limiting duplication of services – Support individuals and organizations to work in partnership towards a common goal or project instead of competing unilaterally against each other for a limited pool of grant money Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

CONCLUSIONS SET PRIORITIES IN THE SECTOR Venture Philanthropy –Identify a focus –Acquire expertise in a social issue –Connect large scale investments with the organizations that demonstrate the most promising efforts and ultimate results Entrepreneurial Incentives –Design healthy competitions that involve convening, dialogue, and intellectual sharing –Achieve targeted solutions –Encourage individuals to become drivers of social change –Utilize community familiarity, history, and local associations to accomplish progress that is sustainable at a local level Entrepreneurial Incentives and Venture Philanthropy: Not your Grandmother’s Benevolence!

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