Spawning Salmons, Not Creating Whales: A New Paradigm for Accelerating Social Transformation.
We are in a period of unusual turbulence. There is uncertainty in all sectors of our economy and society. Traditional frameworks are being upended, which is having an impact on the philanthropic and social sector. I am seeing three distinct shifts that impact the social/philanthropic sector.
Second Curve Philanthropy
First, the traditional model that we have followed for 250 years where value creation flowed through hierarchical institutions is slowly declining which is undermining the relevance of many existing institutions including philanthropic ones. What is happening is that we are seeing the rise of a new highly networked emergent, and a fluid way of organizing activities and creating value. Small groups of people are taking action that is getting highly amplified through social media and other technologies. They can at times more effectively accomplish what only previously large organizations could undertake. They do so with limited resources, management, structure and by defying traditional metrics and processes. The Institute of the Future is calling this a shift from First Curve Philanthropy to Second Curve Philanthropy See http://www.iftf.org/philanthropy/ and Marina Corbis in https://ssir.org/articles/entry/second_curve_philanthropy.
4 Levers for Change
Second, we are seeing four new levers of change. These four levers are:
New Funders and Funding Models: In addition to a massive wealth transfer projected over the next two decades that is estimated at $30 Trillion, there is a new generation of funders that are younger and wealthier, and they are not waiting to retire to give away their wealth. They are developing new models to deploy investment for social change. The instruments they are using go beyond setting up a traditional foundation. Instead, they are using many hybrid models for investments including LLC’s, impact investment funds, crowdfunding, mission related investments and giving rise to the slow money movement. Further, more women are becoming active social investors all over the world and we are seeing new approaches from them that were traditionally not focused on by existing foundations.
Giving cash through crowd funding is becoming increasingly accepted. GoFundMe over the last seven years has distributed over $3B. In addition, new organizations like GiveDirectly are supporting poor people with a years worth of income with no strings attached. GiveDirectly transfers about $1,000 to very poor families over the course a year in Kenya and Uganda. Dollar-for-dollar, analysts say GiveDirectly is among the most effective organizations in the world trying to eliminate extreme poverty. Funded by two of Facebook’s co-founders, the organizations work is data-driven and transparent in ways that are virtually unheard of in the aid world. See Nico Pitney in http://www.huffingtonpost.com/2015/06/04/givedirectly-cash-transfers_n_7339040.html
Measuring Impact and Return on Investments: There is also a growing awareness to how we measure impact. Jed Emerson led the work on developing a model to measure socio-economic value by attempting to quantify and incorporate certain elements of social value. Roberts Enterprise Development Fund has been funding social impact projects for over 20 years and has developed a model for valuing social return on investments (SROI) where over a 10-year period measure economic, social-economic and social value creation and have added a fourth dimension of value creation that of Transformative Value. The central purpose of the nonprofit sector is to create some type of change to transform our society and world for the better. Transformative Value becomes the basic foundation upon which the other three types of value are based. See more at http://hbswk.hbs.edu/archive/1957.html.
Given the rise of impact investments and venture philanthropy, are traditional models of measuring impact relevant anymore? Further, many are questioning how to reconcile risk taking and the ethics of experimenting on the back of the communities that are most vulnerable and have the least amount of resiliency. In a world where â€˜do no harm first was the prevailing mantra, venture philanthropy is embracing failure and risk taking. The question is whether there are consequences of these shifts on the most vulnerable that we are trying to help.
Bridges International a private venture backed model for educating poor students in Kenya and other parts of Africa are running into challenges as they are scaling very rapidly so they can become profitable. In doing so are running afoul of local regulations, and coming under fire from teacher’s union, the poorest families who simply cannot afford the tuition and additional payments that Bridge requires. Bridge is currently operating at a loss. Bridge International wants to maintain a Silicon Valley type growth and go public. The fundamental question is can you make enough profits to provide the financial returns to investors and still serve the poor. Is it ethically acceptable to do so? In this case the jury is still out. See more at: https://www.nytimes.com/2017/06/27/magazine/can-a-tech-start-up-successfully-educate-children-in-the-developing-world.html
Exponential Technology: Technology and particularly exponential technologies such as: Artificial Intelligence, Big Data, Robotics, 3D printing, Internet of Things, Synthetic Biology are leading to the dematerialization, demonetization, and democratization of technology. However, these exponential technologies will also lead to massive social transformation in the decades ahead in which the impact of exponential technologies will be unevenly distributed, resulting in a paradigm shift in the notion of human inequality and class division. This will lead to a period of pre-abundance where there will be a distinct difference between the Super Haves and the Super Have-Nots. The Super Haves will be those that will embrace this shift, capitalize on the benefits, and have the resiliency to withstand shocks that come. The Super Have-Nots will be those unable to capitalize on the benefits of these technologies and not withstand the shocks. Now is the time to question our role in the social impact space on how to encourage a new generation of exponential leaders to build a bridge to this abundance. Abundance The Future is Better Than … — Peter Diamandis, www.diamandis.com/abundance.
During the Ebola crises, technology and big data played a critical role in eventually stopping the spread of the deadly disease as health care workers using mobile phones could locate the worst incidents and respond effectively. Recently, Tableau and PATH have teamed up to combat Malaria in Zambia. Through this initiative, software, training and funding is being provided to PATH teams on the ground so they can make data-informed decisions when it matters the most. Health workers can report new cases of malaria in real-time. Zambia Ministry of Health is using Tableau software to see and understand that data, and deploy the appropriate resources to contain the outbreak.
Read more at https://www.tableau.com/about/blog/2015/10/tableau-foundation-teams-path-visualize-no-malaria-zambia-45228#Ym0sD8gpxzi7Bk4A.99
Scale and Public Policy: Whether is it funders or social sector players, there is an obsession with scaling every investment. Borrowing from the venture capital model, we are racing to ensure every social investment scales and scales quickly so investors can get returns on their investments. However, we are not stopping to question whether every social impact effort should scale, and whether it should scale rapidly. Why is the hockey stick curve growth model, which might be appropriate in some circumstances in the business sector, being used in the social impact space? In many cases, it may not be effective, or even appropriate to scale, without the collaboration and effective partnerships to achieve the desired impact. Further many efforts today where scaling is a key goal avoid connections to public policy. Yet in many cases, the most effective way to scale is through connections to public policy and looking at ways to enhance public, private, and social sector collaboration. Instead of creating a completely new effort, what if we think about repurposing existing resources from the government, nonprofit and private sector? Can we create innovative ways to align them for better outcomes; can we harness the sustaining power of self-interest among these three sectors; and can we look to create common benefits through market shifting strategies?
TEALS (Technology Education and Literacy in Schools) helps high schools throughout the US build and grow sustainable computer science programs. TEALS, helps high schools build and grow a rigorous and sustainable computer science program. Partner trained industry volunteers work in the classroom alongside teachers and then hand off the classroom to classroom teachers to teach. In 2017 the program has reached 352 schools in 31 states., reaching 14,000 students and 1000+ volunteers from 200+ companies. https://www.tealsk12.org/
Third, to accelerate social transformation and have the sustainable impact on the communities we serve, we need to rethink our approach. We must take into consideration the growing impact of second curve philanthropy and the 4 Levers of Change and move away from funding and creating Whales, where one or few programs grow on a massive scale to have the desired impact. In our zeal to create whales, we are also accelerating the rate of failure. The impact of failure from large projects is very destabilizing for the most vulnerable of our citizens. The harm created in its wake has a much more lasting effect. With funding models changing, people are and should be encouraged to do rapid prototyping using Human Centered Design, and empowering people with technologies and connections with each other, and other mechanisms. We can do the kinds of things previously only large organizations could accomplish. We can rethink the results we want to see and how and what it will take to get us there.
Consider Spawning Salmon small yet impactful efforts that are locally driven and connected efforts that can swim upstream and create their own model of sustainability or re-creation. Even if a few salmon die or in other words, a few projects fail there are many others that will continue to thrive and feed the community.
This does mean accepting a variety of factors at play, such as supporting small groups of organizations, funding and building the capacity of these organizations to use transformative technologies, creating new mechanisms of funding and moving away from capital preservation to capital investments, and supporting innovative partnerships and collaborations. In many cases, working within the existing policy framework and innovating within the system rather than outside of it. As we move into the era of Pre-Abundance, we must invest in producing a new generation of leaders. Leaders, who are willing to take informed risks and swim upstream, must be resilient and be bridge builders between the first curve and second curve philanthropy. They will need to be continuous learners; be able to accept constant change and embrace ambiguity. They should be able to balance doing things right and doing the right things. We must create a new generation of compassionate leaders and not those following their own passion.