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Hello and welcome to tony martignetti non-profit radio big non-profit ideas for the other ninety five percent. I’m your aptly named host, our listener of the week, beth burghdoff ski, she tweeted. Tony martignetti non-profit radio is one of my favorite podcast to listen to we’re gonna make it the favorite. She reviewed the show on her blogged she reviewed the show on her own podcast, which is called driving participation it’s about branding, marketing and fund-raising you could check out driving participation on itunes, and she is at beth burghdoff ski b r o d o v s k y beth, i’m going to send you a video so you can pick a book from the non-profit radio library and i will send you the title of your choice. Congratulations on being our listener of the week, beth burghdoff ski very grateful for your support. You know, i’m glad that everyone is with me because i’d be forced to bear the pain of paki and nicky, a congenital if i came in contact with the notion that you had missed today’s show e-giving tuesday, founder henry teams is the founder of giving tuesday he shares its origins how it did in twenty fourteen how it got here, how your non-profit can participate and takes on the critics the fourth sector is the second segment why you need to recognize, understand and respond to the growth of for-profit social enterprises. Jean takagi is our legal contributor and the principle of neo the non-profit and exempt organizations law group, san francisco on tony’s take two between the guests, please, i urge you get started with planned e-giving were sponsored by generosity, siri’s they host multi charity five k runs and walks. I’m very glad that henry james is with me in the studio. He’s, the founder of giving tuesday the global philanthropic movement that engaged more than ten thousand partners worldwide. He’s, a practitioner in residence at the stanford university center on philanthropy and civil society and was named non-profit times influencer of the year in twenty fourteen that’s that’s old news we’re going to this year that’s right of resting on laurels already yesterday’s man he’s, executive director of the ninety second street y still does that in new york city, which is a very big y, very big cultural institution. Really. In new york city, you’ll find giving tuesday. At giving tuesday dot or ge and he is at h tim’s t i double m s many times welcome to studio. Well, it’s, great to be here. I’m a big fan and i really appreciate everything you do for the sector. Thank you, it’s, our it’s. My pleasure. I love giving back teo non-profits on dh this is how we do it. Yeah, um, you have a lot to say about the premise that power is shifting say something. S so one of the things we’ve been thinking about a bit is, and i think this is true of giving tuesday, but also true more widely of some of the things i’m going to get to that, of course, doing in the uae is the way in which we were all thinking really carefully about how technology is changing, right? So we’re thinking about how we should get digital people on board and how we should make sure we understand twitter, but but i think something deeper is actually happening, which isn’t actually superficially about how technology is changing, but really how human being is changing. And we just put together a paper for hbr with my colleague jeremy. Heimans last month, which is really around this idea that the shift we should be anticipating isn’t about how technology changes, but how power to changes on that power is shifting from a model that you can think on his old power, which is very much about command and control, and downloading on your audiences to a model is really about new power, a new powers, really, about engagement, about participation on about theory around upload about how you really engage on it seems to me especially we think about the non-profit world that shift, which is from you, talking out audiences and telling them what they should care about, too. You actually engaging your communities to get behind the cause you care about is going to be a pivotal issue for us for the next decade on i want to include a link to that harvard business review article way posed toe takeaways on facebook, so i’ll i’ll make sure link is they’re not great, i won’t listen, we just we just launched this is that? Is that legal you presented to me, your incoherent? You’re in good shape, actually in a very in a very new power away. Harvard business review has actually start opening up their content a lot. Mohr to make it much more terrible on we’d love some reactions from the nonprofit sector because it’s a it’s a new idea, i think it could be valuable, and we’d love to know what people think. And that article was just last month. Yeah, it was the big idea in the december issue that you had to do something going out of your being non-profit influencer of the year, you had to end on a high note, but of course, now the now you have something more to do in twenty fifteen. Yeah, the from that article you know some of the new power values informal open source collaboration, radical transparency. Do it yourselves, you know, vs the traditional managerial ism institutional ism holding power, not not sharing content and knowledge. Yeah, i think the the one frame that we’ve used to kind of to simplify the idea is thinking about power less as a currency on maura’s a current so how is power? Not something that i own and xero some. But how is it? How is it a current? How does it build? How does it grow, and i think that idea for the nonprofit sector is so important, especially we think about fund-raising because i think we’re entering a period where we are trying to shift from a mentality where we think about donors, right? We have our old power donors, so when we get them to give us money, but the cause is who we’re going to really win won’t have donors, they’ll have owners will have people who actually are completely believing in their cause and getting behind it, and you only need to look at something like a recipe for ice bucket challenge, which really wasn’t about donors. It was about owners, it was about people who really believed they were the agents of change. I think that idea is a very big idea for the future. I had the ceo of a less on to recap buy-in in september, october something i just they’re going twelve tremendous learning from that. And actually, one thing i read from your twitter feed was a fund-raising expert who had written a complaint that she had sent eight checks toe organizations for year end and two months later, five them and yeah, she’s i think it’s at the-whiny-donor think that’s the i’m not even sure if the man or a woman i don’t know if the person won’t reveal themselves just at whiny donor-centric ember eight checks issue to most later three of them for them hadn’t sent think yes, that’s a donor not on owner comps pair that to something like a less where you have people who are literally the stars of the show that shift is going is going to be, i think, monumental for our sector and i love the metaphor of power because power is not has no value unless it’s flowing, yeah, that’s, right? And the new model is it’s flowing out in terms? I mean, i think of myself, you know, four years ago i had been a content i mean, there have been a host of a show now now i’m a content creator on dh that on that trend is only going to continue, and the way i think we need to think about it is not in terms ofthe the technological bias, right, which is most non-profit you see this problem, lunge a twitter right? So they suddenly think i better get on twitter. And this problem will go away is really not about that it’s actually, about you thinking about how you enlist people in a very human way to get behind the things you care about. The big new power challenge, i think, is getting the non-profit sector to shift in that direction. And how is giving tuesday an example of this new power shift? Well, i think in in two ways one in its design. So we we started giving tuesday at the ninety second street y, but it was never the ninety second street wise giving tuesday, right? The old power model would have been it’s, the ninety second street wise, giving tuesday. We spent all of our time making sure we got a lot of media and a lot of credit for it. And it would have probably affected people two blocks to the north and two blocks to the south and that’s as far as it would have gone. But we deliberately said it needed to be open source. That giving tuesday needs to be non branded by anybody. Which means that anyone from the red cross to the night, second street why? To the fourteenth street? Why? Teo, people in the uk but take the same theme and respond to it. And that was a very new power idea, which was it’s really not about command and control, but actually creating tools for people to engage exactly and that’s what you see when you goto e-giving tuesday dot or ge there’s a whole bunch of sharing tools, there’s videos explaining what what charity’s could have done, what you could do have to get involved. It’s, it’s, it’s empowering the sector and sharing enormously we’re on the story, i think which doesn’t get told often, which i think is important is that this was not all right. This was not our phrase. Someone described giving tuesday as a shared learning environment and actually because of giving tuesday hours and hours of free resources, always free have been created for the non-profits actor, i’m a friend of my marian salzman, who is one of the world’s leading expert in marketing and pr did a special webinar specifically about how how did you hyper local targeting for non-profits right? She is one of the most sought after experts in the country, but she’s providing that for the sector. Andi, i think as we move forward with giving tuesday how we can use it to help the sector learn together us most of all right, how we can all learn together is going to be the story which no one will write about, but i think it’s probably gonna be the most influential one let’s go out for a couple minutes when we come back. Of course, henry now i’m going to keep talking about giving tuesday it’s history evolution through the years, and we’ll take on some of the critics stay with us, you’re tuned to non-profit radio tony martignetti also hosts a podcast for the chronicle of philanthropy fund-raising fundamentals is a quick ten minute burst of fund-raising insights published once a month. Tony’s guests are expert in crowdfunding, mobile giving event fund-raising direct mail and donor cultivation. Really all the fund-raising issues that make you wonder am i doing this right? Is there a better way there is? Find the fund-raising fundamentals archive it. Tony martignetti dot com that’s marketmesuite n e t t i remember there’s a g before the end, thousands of listeners have subscribed on itunes. You can also learn maura, the chronicle website philanthropy dot com fund-raising fundamentals the better way. Welcome back to big non-profit ideas for the other ninety five percent it’s. Time for live listener love, green bay, virginia, new city, new york, new city call that’s up, rocklin county, way just above new york city on the other side, st louis, missouri, new bern, north carolina live listener love to each let’s go abroad, we’ve got shenfeld, germany. I may not have pronounced that right. I apologize. Guten tag, japan. I can’t see which city your city is masked, konichiwa, and we’ve got korea, kwang ho dong korea, anya haserot live, listen, love more to come, and i’m looking for, ah, special live listeners who should be in california and santa lucia preserve way. Don’t see her yet, nobody from california, sam, okay, i’ll shut her out when she when she joins us, okay. How did e-giving tuesday start? You had these obviously had this power shift ideas, how do we get this thing started? So we were thinking, you know, the night second street wise community centre, what we spend our days thinking about is how you bring people together and that’s what we’ve done for one hundred forty years, and we were thinking, especially around the holidays, you know, about black friday, you know, about cyber monday, consumer oriented america’s wallets are open, wouldn’t it make sense that the non-profit world is a part of that conversation? So the initial idea, which was black friday cyber monday e-giving tuesday and so it began with a team of the why, but then what began to happen, which i think we learned a lot from was it wasn’t just the leaders of the white who were working on this, but actually people from lots of different organizations. So some people from stanford university, from the economist from facebook, most of all, from the u n foundation, who actually formed a team of lots of different leaders and experts to kind of frame the idea to shape it, to start rolling it out on we kind of got on with the year one and we you know what? Just two and a half years ago, which seems unbelievable. The first e-giving tuesday was which your tio two thousand eleven? So we thought this was giving tuesday three we’re done three of them now, and we launched it with seventy days to go. And it really caught on the first year more than we thought it would. And that really gave us a chance to start thinking a bit more carefully about what this is, how it can be helpful to the sector most of all to learn. I really think it’s important with giving tuesday to think this is very early on in a project, right? This is we’ve done this for less than three years. The real question is going to be, i think, two or three years out, when we start to see the kind of scale we can get to in the kind of depth of impact we can reach. But that’s where it began, it began with an idea about collaboration, especially one of the things in the nonprofit sector. We all suffer from andi. I run a non profit, so i understand this is we all want to raise money for ourselves, right? We were always fighting against each other to some degree. We wanted to experiment with this idea that actually, there could be a tide that helps lift all ships. That was one of the driving ideas behind giving tuesday. I’ve had honest asia dellaccio on from the u n foundation she’s trouble a year and a half or two years ago, talking about giving tuesday she’s tremendous she’s one of the you know, she’s one of those people actually are who i think represents a new generation of leader that that kind of millennial voice who is so deeply committed to changing the world but also is so savvy on some of these new power tools, right? She’s someone who really gets how the world is changing, i’m not sure that’s true, more broadly in the nonprofit sector, i think that’s one of the big challenges that we think about a lot, which is how how is a sector? Can we make this turn as quickly as some other industries are? You can follow anesthesia because she owns shows. Owns a gelato company in washington, dc, and she is at dull ci d o l c i t sweet gelato is what it translates to, but dellaccio gelati is onstage dellaccio how did e-giving tuesday do in twenty fourteen third year? So i thought we saw some really positive progress. We had twenty thousand partners take twenty thousand? Yeah, you know where they got out of the states that there’s amglobal there’s some global numbers in there too. So people around the world on dh i think we made a really important we can talk about the numbers in a minute, which i know is where the conversation always ends up, but i thought something else happened, which was important, which was we made a statement about shared values with the driving idea behind giving tuesday when it began wasn’t immediately how can we run up the score in terms of dollars? It was much more about saying at a time when we are reaching the end of the year, we’re thinking about what we’re grateful for with entering the season of giving how can we actually start a bigger conversation about caring for other people? Because philanthropy, of course, is the ultimate expression of that it’s the ultimate expression of caring for more people. So i think the biggest win with giving tuesday in my mind last year, was what it demonstrated was the power off of really hundreds of thousands of people around the world to pause at a time off consumption and understand really unruly, underline how much they wanted to give back to others. She started to see a cultural shift, i think that’s right? I think that’s the hope, i think that’s the hope that actually you khun galvanize that and i think the great hope for giving tuesday a time when so much divides us so often the idea that something which can bring together people in all fifty states, all different backgrounds, all different levels of diversity or different political beliefs, if we can come together around the most human act, which is carrying from one another, i think that’s a really important idea, but i won’t dodge the question, which is about the money. Yeah, we’ll get to that. But it’s a beautiful, you know, unless somebody collapse wednesday. I don’t know what will happen with wednesday, but you know, it’s, beautiful book and thanksgiving and then and you didn’t mention small business saturday, of course, nor to another support your local small business and endeavor way have a conversation year one one of the smartest investors in entrepreneurs in new york who’s an adviser of ours, i said, leave it for a year, you haven’t got you haven’t got the plans together, don’t do it like seventy days, way launch quick, but they’re one of the main reasons for that was i was pretty convinced someone was going to grab tuesday. I actually thought what was never speaking to happen was on the back of black friday and cyber monday there would be another, whatever you know, lt was coming. Thank you, thank your customers tuesday or whatever it wants, so i actually thought it was important we try and grab it for the philanthropic sector. All right? Did you hear rumors or was just was the universe talking to you that way? I think it was an instinct. I think it was. It was an instinct instinct. I i admire instinct enormously. I don’t often kick myself if i if i don’t follow it. But then also the book end. So, you know, you think thanksgiving and giving tuesday book ending these consumption days in the middle? I you know, i i admire the idea well on the other it’s checking things out, the other thing we thought was important, and actually, this was an idea off matthew bishop, so the economist who who’s, a really obviously leading thinker in the flandez piece based he was always pushing us hard from the start on saying this should be the opening day of the giving season, right? So the giving season has a very big clothes the last three days of the year, but it doesn’t really have an opening on obviously, december is the most important month for a lot of non-profits toe raise funds and awareness and volunteering, so that was always a framing idea for giving tuesday, and we’ve seen some pretty interesting data on that point. Okay, numbers, terms of dollars charities. So thie the case foundation working with indiana university, did a good sample of a lot off the main online processes, and they’re counting around forty six million dollars from a group, often not all of them but a group of processes online there’s also, of course, a lot of offline money coming in to and there’s a lot of volunteering hours on other activations around giving choosy that we think is important, but the number which the press is always going to get his forty six million yeah, the dollars given, but yeah, the volunteering i mean that that dovetails with the shift that you’re the cultural shift that you were seeing that e-giving i also think, yeah, broader definition. I also think there’s something which people are doing well, which is using giving tuesday, is an on ramp for people to have longer relationships, so the people actually using giving tuesday is the start of something and then driving it through the whole of december or doing a match campaign for all of december, or pushing people towards, for example, recurring e-giving e-giving toothy is also mally just a notch, right? So it’s a moment, and if we could make it a very big nudge, i think it can be very powerful, but it is pushing a lot of people in the same direction to take philantech be just that bit more seriously, and then our job. Is non-profits is to grab their attention and turn into something sustainable? Yes, and and i think some of the critics don’t i don’t know, maybe they’re not crediting non-profits with recognizing that that it’s just a start or they don’t feel that it’s that that that’s going to happen, you know, there are some who say that it’s just taking giving from some other some of the day and transplanting it to this day. It’s yeah, i mean, i was master that yeah, i think it’s important, it’s important to think about that and the data we’ve seen so far don’t perfect. Did a good survey of there are quite a decent sample size of their organizations and actually found those organizations participating in giving tuesday. We’re doing twice as well online in all of december grayce was powerful and then the real one of people i listen too. We all listen to a lot on these ideas that steve mclaughlin a blackboard on dh he really has a strong view, which i think is right about the importance of us not fearing scarcity in the nonprofit sector, where we kind of have this oliver complex that we tremble. As we ask for mohr on dh and actually i think what the data shows is asking is, what leads you to getting money? The critique then e-giving choose which i think is is important to address is then, is it just in the moment? Right? So people think, is it one and done? I think that’s a reasonable concern, but again, i think what you’re seeing with giving tuesday is those organizations who are really winning big of those who have seen this in a very strategic and comprehensive way that bringing people on board and then they’re working out ways to keep them a comprehensive way. It’s not a day it’s it’s part of your overall strategy on dh bringing people, and then you have a responsibility to keep them engaged and invested. Wait, we are often say around the office that you know if e-giving is is a marriage e-giving tuesday’s the anniversary, right? So this should be going all year round, but this is a special day to engage on. I’ll give you one example of that which was very powerful, i thought from this year so the university of michigan they took giving tuesday they turned into giving blue day, right? So they talk they remix very new power idea, which which was remixing the concept to make you more relevant to them. It’s making more about them less about us, they turn it into giving flu did they set themselves a big goal, which is a million dollars to raise. And they caught everyone from their alums to the students, to the president or working via social media to dr money online. Their goal was a million. They made three point four million dollars on the day, which was mohr than they were ever making on the last day of the year. But much more importantly than the dollar figure, they made a statement about value. They actually got these the shift i was talking about earlier, which is shifting people from donors to owners. They didn’t just raise three point four million dollars. They brought a whole community to be their fund-raising team that’s the big idea, i think around giving tuesday very good. This is why i love this is a podcast because people can now go back and listen to that last sentence that you just said. Donors toe owners a bigger volunteer community helping sustained that sustain the movement you know all the fund-raising data says the same thing, which is the most powerful way you can get a gift is if a friend asks for it, right? What does facebook? Facebook is an entire ecosystem off friends and friends and friends. It is the biggest fund-raising force in the history of mankind, and no one has begun to tap that yet and again, lots of tools for using giving tuesday in your lorts much larger plan at e-giving tuesday dot org’s so it shouldn’t be intimidated by this idea now that’s, right? And the other thing we’ll do throughout the year, we always have a bit of a break, but actually one thing we’ll do throughout the year launching in sort of february march is very regular seminar’s webinars best practices will do sessions about campaigns that worked really well. We’ll do sessions about campaigns that didn’t work so well, but what we’re going to really try and do is make sure that we learn from giving tuesday because i think we as a community are often jumping to verdicts. This is tremendous, this is awful. The truth is always more nuanced, and we we as we enter this new power world with so many of the dynamics, are changing. And a time when so many of our behaviors are based on old power principles. Our willingness to engage with real change is so important, and, i hope giving choose. They can play a small role in that. Now, another challenge is you’ll see that people will take the dollar amount raised e-giving tuesday and divided by the number of charities and say the average was somewhere around three thousand dollars. Or if they’re being generous, sometimes they’ll up. The numbers could account for under reporting, and they’ll maybe, say, six thousand dollars for charity. Is that, you know, is it is it worth the effort? Well, i mean, i think if you talk to a lot of non-profits in this country, six thousand dollars is a huge amount of money for a lot of non-profits that really makes a big difference because many of the non-profits they’re small, they have small budgets and they’re doing incredibly important work, so i think i think we should always be careful, especially larger organizations, to discount the importance of small amounts of money, smaller amounts of money. I think i’d say something else, too, which is if you had said, i’ve found the way to get twenty thousand organizations or ten thousand organizations avectra six thousand dollars, people would probably think that’s quite a good thing in the world, so i think to we can build on that we can grow that number, but i still think that the i don’t think i have to be able to prove this, i expect, but i think the mohr maur, the bigger contribution of giving tuesday isn’t going to be just a dose of the dollar amount, which i think will grow, i think it will actually be about how it encourages people to try new things and actually what? I was interested this year in what i saw my end of year, i got asked obviously i gots listed for end of year from a lot of organizations i didn’t see very much creativity in that at all. I saw a lot of people saying it’s the last day of the year, but give me some money with giving tuesday i saw a lot more creativity. I saw a lot more engagement on a really interesting statistic from blackboard they saw seventeen percent one seven percent of the money coming in via mobile, right seventy seven buy-in mobile this is a very different idea for us. A sector on dh there was a really interesting article this week about how much trouble, how much over challenge non-profit sector is having in adopting mobile in a meaningful way and if you look at any of the trend data on what mobile is going to do, tow our organization’s it’s going to be exponential changed for years. So again, i hope what we could do with giving twosies actually shift the mindset, teo encourage a lot more learning a lot. More entrepreneurialism and then ultimately why we’re in this is a lot more impact. There was criticism of blackbaud also because they have some self interest, they they make money as people give through the mobile platform of theirs, which is a very popular i mean, that’s been there’s been a critique writ large off of all of the kind of different operators, and of some of the giving days all of these things, which is what is the role for commercial benefit in some of these sectors? I have to say, i think some of the more powerful arguments here are thinking about the level of quality that they can bring to the sector on what that value is two non-profits on someone like blackbaud who actually think, add so much value for non-profit that is really worth something, and i would say, is someone running a non-profit i would take that kind of investment very seriously. You just mentioned, you know, trying something different, and i i’m a huge fan and see i have the beauty of not being a journalist, so i don’t have to be oh, fan of giving tuesday and basically, i say, fuck the critics. Because, you know, we see so much. The sector sent to be very tend to be very critical of itself. I think ice bucket challenge was an example that harsh critics not giving the organization of chance, and then you also see so many people they want to encourage innovation on a lot of times i see it on twitter through mahatma gandhi or maya angelou quotes, you know, be the change you want in the world think global act locals think big, small you shook things up, you know? You started something that has enormous potential and so far hasn’t fallen on its face. Let’s give the damn thing a chance, you’re shaking things up, and so i hope the critics recognize that well, i pride probably would not share the language but share some of the sentiments. Which thing? I think the thing i think more about actually we’ve heard this from giving tuesday often is the twenty three year old person who’s just joined your non-profit who’s caught some big ideas and doesn’t feel empowered to try them time and again. Actually, what we heard about giving tuesday was, well, we gave this project to the intern on the intern, then delivered sameh zing. Results on actually, i think, that’s the our capacity to try new things, to be bold, to be ambitious. I think that capacities the most important idea, and i think the critics looked ideas like this should have critics they should have constructed. That ecosystem is good for the world, but i do think i would draw a line at the point in which we are fearful of innovation, right that’s, a very different idea, and i think our fear of innovation as a sector is going to hold us back more than almost anything outstanding. Henry tim’s. You’ll follow him! Find him on twitter at h tim’s t i double m s e-giving tuesday dot organ i mentioned a bunch of times, and he’s, the executive director of ninety second street y, which is nine too wide dot org’s. Thank you very much, henry it’s. Great to be here. Pleasure. I like to have you back. We have tony’s take two and jean takagi coming up first i have to alert you to generosity siri’s, you know, they host those five k runs and walks. Henry was talking about community building. This is a community of small and midsize non-profits that can’t run their own five k events. You know she’s not going to get enough people, you’re going to get like twenty five or thirty people on a on a five k track in a park. You can’t do it it’s not feasible, but when twelve or fifteen or twenty small midsize shops each contribute twenty five, thirty people, then you have a fantastic fund-raising event fun event that’s what generosity siri’s does. They put the charity partners together so that you have a day long. Actually, that was only half a day successful five k event talk to dave lynn he’s the c e o he’s at seven one eight five o six nine triple seven also generosity siri’s dot com my video this week start your planned giving with bequests this year big misconceptions around plant e-giving it’s not on ly for big shops you don’t need a lot of you don’t need internal expertise and it’s not on ly for wealthy donors small midsize shops khun do enormously well with donors of very modest means you start planned giving with bequests why i explain it in the video i’ve got links to a six article guidestar siri’s that i wrote on the subject at the video. Think about it. Now is the time to start a planned e-giving program with requests the video is that tony martignetti dot com and that is tony’s take two for friday sixteenth of january show number two of the year jean takagi he’s around he’s, the managing attorney of neo the non-profit and exempt organizations law group in san francisco he edits the popular non-profit law blogged dot com and on twitter he is at gi tak gt a k welcome back, jean takagi hyre durney great to be here. Thank you. Where you calling from? Yui san francisco today i’m actually in washington d c today your dc ah you with the fourth sector conference, right? Exactly right. Great chances. Okay. What is this? Fourth sector? This fourth dimension we have to deal with. Well, oftentimes the non-profit sectors thought of as the third sector. Independent sector and there’s. This new sort of class of organizations that are coming out. Some of them are for-profit. Some of them are non-profits, and they’re commonly referred to as social enterprises or for benefit organizations. And they’re kind of this diverse class of organizations that shared two main characteristics. And one is that they are primarily driven by social and door, environmental purpose. And two they earned a substantial portion of their income through earned revenues or business activities. Social or environmental is where you see most of them. Is that right? That’s? Right, danny? Okay. Ah, and what forms of organization are they are they take it so you’ll see many of them is existing non-profits and these have been around for a long time. So goodwill is an example of an organisation, social or charitable purpose, but derive a substantial portion of their income through earned revenues. Um, the national geographic society is another great example of ah, non-profit which actually has a bunch of for-profit subsidiary in affiliate organizations as well all structured together, you know, seen as part of this fourth sector comprised of both non-profits and for-profit that are really looking at earned revenue is the primary way to make money and not just relying ondo native incomes a little bit different from what you and henry we’re talking about, but involving some of the same people was interesting that henry mentioned matthew bishop from the economist who is the one who sort of popularized the term philantech row philantech rabbo capitalism, our philantech xero capitalism and basically looking at this fourth sector idea on dh, he mentioned the case foundation, which is tracking the giving tuesday funds that were raised, i’m sorry. Ah, and the challenge funds our raised and the case foundation are really strong proponents of impact investments and its port sector in backto jean k c e o of the case foundation was there at that gathering, the what we’re seeing is that these fourth sector organizations sabat can very well be taking our are taking money from what? What henry would call the traditional power and values charities. Yeah, i think there’s there’s a big trend going on and there’s quite a bit of competition that a lot of non-profits especially traditional non-profits may not be aware of, and i kind of wanted to talk a little bit more about about that competition because i think it’s really something that non-profits have to be aware of, um, they’re big movements right now of money of talent, of business that they’re going to for-profit that see themselves as social enterprises, many of them that are very true and sincere about their driving, their social purposes, but some of them out there who are sort of posing as these social enterprises but really, after a new market and in you niche. Teo generate as much profit as they can, so trying to distinguish between those who are really social enterprises in those who might just being bailing themselves and that the guys is really important, okay, let’s, well, we’ll come to making sure you’re dealing with a bona fide social benefit enterprise. Another concern are just around the competition. I just want to make this clear that that corporation money can go in this direction as well. Yeah, and, you know, while i mentioned examples of non-profit social enterprises before in goodwill and national geographic, there’s there plenty of for-profit competitors out there already and where competition for funds is is already existing. And, for example, there’s, a very popular charity right now called cuba, but keep it facilitates a lot of donors to be able to make loans to small micro businesses and developing nations, and and also they started in the united states as well for disadvantaged communities so people can go on the keepers site and make these micro loans to these businesses. But those are not donations those air loans that you’re making, you don’t get a charitable deduction for making that loan to another individual. Oh! Our group of individuals, you’re funding a business basically through alone. Crowdfunding often has seen the same way some crowdfunding is done by non-profits, but primarily it’s driven by for-profit, many of which are pursuing social names. But individuals, rather than may be making a donation to charity, are starting to find crowdfunding, a project that may or may not be charitable crowd funding projects and making loans to micro enterprises through cuba, which are not charitable donations. And this is you believe, ah, a recognizable portion of this is what would have been terrible money. Yeah, and i’m not saying that that’s a bad thing at all on dh, you’ll see proponents of the port sector and and i’m a big fan of what’s what’s happening, although again distinguishing between the real ones and the not real ones is important. It is just knowing that that that competition is out there and it’s going to drive non-profits or it should be driving non-profits to compete by showing impact, demonstrating impact, going after these big entrepreneurial goals that the social enterprises go after and seem to attract a lot of money doing so. And, you know, i’ve been talking about individual donations, which some people might think of more smaller potatoes, although obviously the ellis challenge showed you how much can be raised through those means think about organizations like google and their commitment tio, you know, donate one percent of their profits, too, doing a social good? Well, most of that donation that heavy bulk of that donation is not non-profits and one percent of google revenue that’s a lot of money or hate dunaj you know, most of them are thine google bone initiatives and corporate money may be going to their own community see csr or corporate social responsibility goals rather than going teo corporate sponsorships to charity foundation grant was going to be going to the social enterprises as well, because there’s this attraction out there that a for-profit social enterprise, i can create a sustainable source of income to continue doing it social good. And so once he set up the infrastructure for which you might foundation might give grant money, you don’t have to keep giving grants to these organizations because they’re letting the market forces then create the sustainable business, getting underserved communities like impoverished areas with goods and services that otherwise would not go there. All right, corporation money. We see foundation money, individual and with respect to the individual e-giving there’s, something called sector agnosticism that you’ve blogged about. I wanted to explain sure. So the general idea that individuals, donors thunders are all becoming are trending. I should say, i shouldn’t say this is the majority view point yet, but there’s certainly trending uh towards being sector agnostic in that if we want to solve a particular problem, whether it’s getting water to people who otherwise would not be ableto access clean water, or get people to reduce recidivism in person coming out of prison, nor drug abuse flooring that a lot of people are saying well, traditional charities kind of continues to put the bandage on you. No problem and that’s super important to help the people who are currently suffering, but maybe not doing enough to cure that problem. That social problem, which is a huge, huge challenge, and i don’t know that non-profits deserved to be criticized for that very much, but some for, you know, proponents of the fourth sector thing will for-profit can come in, and their health is really needed in order to actually make a big dent in these problems, and they’re looking at it from a slightly different way, and i think all players they’re needed here, i think, government, these fourth sector organizations, i think, traditional businesses that are just after port, you know, profits as well. It’s got to be thinking about this, because consumers now are you gonna buy, and we’re going to start to see this more and more back-up those companies that are doing something about the problems in the world, and not just making much money as they can and the sector agnosticism is people are not really caring what form of organization they’re giving to, or investing in a cz long as they’re seeing impact. Yeah, absolutely. And thank youfor summarizing attorney, that that was really well put, okay? We don’t need you to wait some time. Okay? So we definitely need you. Takagi i take that back. In fact, i’ll tell eugene you have a very big fan listening read stockman and always listening cause he tweeted us that he’s looking forward to listening to you. He e mailed me today saying he is a very big fan of yours. Reed’s document live listen, her love to you and jean reed is a very big fan. Thanks and read and i have communicated through twitter and i’m a big fan of reasons. Well, good. I’m glad i don’t have to be there the person conveying the message anymore. You guys were in that guys are in touch. You know how much he admires your work. Okay, you mentioned it a couple times distinguishing between imposters and bona fide social benefit organizations. Yes, i mean that’s one of the big challenges out there because everybody khun say that they have a social purpose and if you just allow any business itself declare itself is socially good. That could be, you know, a problem for the community going well, we’re going to buy their products because they say they’re good. And they’re commercial look really great. Well, that isn’t enough, and maybe some laws or policies can help in that direction. And maybe that is why we’ve seen the advent of the so called high braider alternative forms of corporations that take on some of the characteristics of non-profits and that they have some sort of social purpose involved but are still for-profit taxable organizations with shareholders who khun get dividends and distributions and make a lot of money to companies succeed. So it’s kind of that in between place more for-profit than non-profit i would say, but there’s a spectrum of how charitable they khun b and for that reason we’ve seen things like the benefit corporation. Some people call it the beat corporation, which is slightly different and all explain the difference in just a second, but social purpose corporation on the low profit, limited liability company or the altri see those air, the three big new types of legal corporate form that we’re seeing in different states. So if you want to partner with an organization, you should be looking for one that is designated in one of these ways. Well, that may be a sign, so it’s one of the signs and we’re in very, very new ground here, they’ve only been sort of developed and created over the last six or seven years, and the benefit corporations now are almost or in about half of the states right now after being first introduced about three or four years ago, i think in maryland first, so it’s going to be very, very interesting to see where where these organizations go, but there are other indicators as well of possible good partners for non-profits that are not just disguising themselves as a socially purposed organizations and that’s just to really that their activities and their purpose statements and their governing documents and see what they’re all about and take a look at their ownership structure and their board of directors does he woulda non-profit grantee to see if you can find out a little bit more about the for-profit and the big corp certification. Jean hold on the different from benefit corporation, but it’s called they’re often both called b corpse that be corpses or certified b corp is this good housekeeping type of seal of approval that is given by this independent nonprofit organization called b? Lap. And so if you meet their criteria, social good and it’s, a fairly rigorous test, and you have to be subject yourself to potential audits from the organization as well, so they can check that years you’re walking the walk and not just talking the talk. Bye, dee corpse status, and you’ll see a circle be around some organizations like patagonia on dh, er, jessica alba’s company. I think it’s, the honest company, those are certified, be corporations, and may make for great partners as well, because you have this outside entity that’s, creating these independent standards of what it is to be a social enterprise and certifying those organizations. Gene let’s, take a break, stay with us. We’ll continue the conversation. Like what you’re hearing a non-profit radio tony’s got more on youtube, you’ll find clips from stand up comedy tv spots and exclusive interviews catch guests like seth gordon, craig newmark, the founder of craigslist marquis of eco enterprises, charles best from donors choose dot org’s aria finger do something that worked, and they are levine from new york universities heimans center on philantech tony tweets to he finds the best content from the most knowledgeable, interesting people in and around non-profits to share on his stream. If you have valuable info, he wants to re tweet you during the show. You can join the conversation on twitter using hashtag non-profit radio twitter is an easy way to reach tony he’s at tony martignetti narasimhan t i g e n e t t i remember there’s a g before the end he hosts a podcast for the chronicle of philanthropy fund-raising fundamentals is a short monthly show devoted to getting over your fund-raising hartals just like non-profit radio, toni talks to leading thinkers, experts and cool people with great ideas. As one fan said, tony picks their brains and i don’t have to leave my office fund-raising fundamentals was recently dubbed the most helpful non-profit podcast you have ever heard, you can also join the conversation on facebook, where you can ask questions before or after the show. The guests were there, too. Get insider show alerts by email, tony tells you who’s on each week and always includes link so that you can contact guests directly. To sign up, visit the facebook page for tony martignetti dot com. Lively conversation, top trends and sound advice. That’s. Tony martignetti non-profit radio. And i’m lawrence paige nani, author off the non-profit fund-raising solution. Oppcoll time for pod classed pod classed this’s, a podcast podcast pleasantries are ten thousand listeners listening through the day wherever you may be. Thank you very much for your support pod pleasantries to everyone listening through the podcast on the time shift more live listener love madison, wisconsin, new york, new york, cartersville, georgia, houston, texas falls church, virginia and we’ve got cheryl mccormick in california, santa lucia preserve, she says. It’s the most beautiful place in california near the monterey prints peninsula live listener love to each live listener jean takagi, we have this new competition that non-profits need thio embrace, recognise let’s spend a few minutes talking about how they can react to it. I imagine partnership is a possibility, yeah, absolutely, and they’re keeping that, you know, i think that are important for non-profits one is recognizing that there is some competition out there on dh there trends out there like sector gnosticism from donors and servants, purchasers and good purchasers that we talked about understanding the fraction of why social enterprises can be attractive tease individuals also really important in understanding the marketplace, and i think some non-profits haven’t done a sufficient job of understanding, not just the market of their beneficiaries that they provide services and goods to understanding the marketplace of donors and supporters and job seekers and potential board members, and knowing what they do have to do to compete for those things as well. Okay, so but let’s, let’s talk about let’s talk about potentially partnering with dahna a social benefit enterprise? Sure, and they’re different different sorts of partnerships that might be possible. So if, for example, you find a for-profit business out there that says, i, you know, let’s partner together so we can run a business using leveraging your goodwill in the community because you non-profit of god, you know, great donors and supporters, and that would really help our business. So why don’t we do something together? We’ll sell more goods and make more money for a business, but we’ll also give you a percentage of our sales, uh, in exchange for using your goodwill and and marketing together. And some of that some people will call that cause related marketing a commercial commercial. Co venturing is the term that would get me and drug in jail, i think, but those those air, the terms that indicate that sort of partnership where the for-profit leverages the non-profits goodwill on dh the non-profit benefits by getting a percentage of the sales, and you see that all over the place, right? Of course, yeah. All right, so if you can’t, you can’t beat the for-profit social enterprises, perhaps you can join them apartment and i think american express to you that this several years ago when they were on redoing the statue of liberty, and then they were raising money together that way, that that benefited both the for-profit in the non-profit so that’s that’s one way that non-profits and for-profit have done he’s partnership, if you will, for a long time. But there are all sorts of other types of relationships that are possible between non-profits and for-profit, and they can become very program specific. So if you have a nen stints of delivering water, teo communities that don’t have clean water, for example it’s very possible that either one type of entity one non-profit or one for-profit would not be the best at doing that alone, and forming partnerships with other organisations is and that’s a scary way to make that service delivery effective and efficient, and if we’re talking about that that that tends to happen more internationally, although sometimes with disaster relief, like with hurricane katrina, those could be issues domestically as well. On an everyday level, if we’re thinking about delivering food to people getting corporations, fruit corporations involved in that khun b completely beneficial toe both entities involved, particularly if you’ve got a for-profit social enterprise that really isn’t about maximizing profits, some social enterprises out there that are for-profit so they have owners are businesses that are willing to break even, and they may not even be willing to take any profit. They might take a reasonable salary like you would it a non-profits but their owners hey, you know, are model doesn’t sit in five twenty three because we’re engaged in commercial activities, but we’re actually not going to take any profit from it. We just want to make sure the services get delivered way just have about a minute left, jane ana, i want to talk about impact because you mentioned it earlier and it’s another way that non-profits can react to this trend that his new competition showing the riyadh and competition out there the for-profit social enterprises and some of the non-profit social enterprises out there well are very good about demonstrating impact and communicating it sometimes it’s marketing, but a lot of times they’ve developed systems because that’s, the way they think non-profits may not be used to that type of pressure. All the foundations are starting to put more and more pressure on them to demonstrate and communicate the impact and that, you know, i’m a big fan non-profits have been responsible for every big social change in our country and justin being able to communicate how they’re doing that and how they’re doing that is effectively and efficiently as possible is going to be super important, not just for funds, tony, but right now it may be more important to get talent because young people coming out there with big college debt, they can work for a nonprofit they can work for for-profit social enterprise non-profits gotta learn how to compete for that as well. We have to leave it there, jean takagi. You’ll find him at non-profit law blogged dot com and on twitter g tak e th thank you very much, gene. Thanks, tony. Pleasure. Next week, maria simple returns with giving circles how? Do you find them, and how do you tap into them? 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