Venture Philanthropist – The New Donor

Venture Philanthropist - The New Donor in Gen YNew generations are born and a new breed of financial donor develops. Gone are the days of your mom and dad who gave to an organization because of the promise of the owner or president. This new donor, called the Venture Philanthropist, is looking for a reason to give money while not expecting a financial return. In addition, he or she is also looking for a organization that is self-sustaining as well as impacting society.

“Well meaning” is no longer in the vocabulary of the upcoming generation of non-profit donors. “Show me results” seems to be the cry of the day. And this is not a one time deal — ongoing and tangible results need to be kept in the forefront. This does not mean a show of numbers, but tangible evidence of social change accomplished.

Many non-profit ventures have been scrambling for ways to appeal to Generation X but now they’ll need to retro-fit their donor development models in order to accommodate Generation Y, the Millennium Generation. Some are rethinking the term “non-profit” and looking at self-sustaining models that do not rely solely on donations. Those who do not take heed could find themselves in financial straights or worse, closing their doors.

Erin Hemmings, of Social Venture Partners (SVP) says:

“What we typically find is that non-profit organizations are extremely good at delivering their programs to those who need them, but they aren’t good at administration, marketing, financing, and internal organization,” says Hemmings, a program manager at SVP. That’s where venture philanthropists come in, helping non-profits to better define goals, measure progress, and be accountable for results. But where venture capitalists hold their investees responsible for capital gains, venture philanthropists hold non-profits responsible for social gains. “Our goal is to make the non-profits more efficient, so they can serve more clients for the same amount of money they spend now,” says Hemmings. With the long-term funding provided by venture philanthropists, executives within non-profits can focus less on fund-raising and more on services.

If you’ve recently started a non-profit or you’re thinking about it, look at the mission, structure, and sustainability of your endeavor. Research and find out more about philanthropic organizations that are willing to invest and partner with you. If you do, this can position you well within the Gen Y donor pool and keep your doors open for many years to come.

Related Links

Social Venture Network
New Schools Venture Fund (TIME Magazine article)
New Buzz in Business (MSNBC)
Does Venture Philanthropy Work? (C|Net)
Washington Grant Makers

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2 thoughts on “Venture Philanthropist – The New Donor

  1. cynthia ohene says:

    I live in Ghana – West Africa. I need start up capital to set community preschool to help young mothers most especially the teenage mothers who have to drop out of school. This is a community project which aimed at helping the young mother through counselling services offered by my company to go back to school or acquire some skills like dressmaking, hairdressing and other forms of professions preferred by them. These young parents will be monitored by my organisation throughout the duration of the their apprenticeship and we will get them employment that will earn them an income at the end of their training.

    Young men interested in the programme are free to join but the main focus of this project is for the teenage mothers to regain their life and respect to be able to have a more respectable status in the society.

    We have identified this problem have made several preparations, but at the moment I need a start up capital to be able to proceed with the project.

  2. Cynthia, see the related links at the end of the article for sources and additional information about start-up monies. You might also visit Guy Kawasaki’s blog (on my Blogroll) for more insight into starting an organization.

    It sounds like you have done your homework and the idea is relevant to the current needs in your area.

    Best wishes,
    -ebrown

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