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June 11, 2010

Philanthropy Is Evolving

Personal recap of Dr. Susan Raymond's (Executive Vice President at Changing Our World, Inc.) workshop at Fund Raising Day 2010, New York; Hope Is Not a Strategy: A Systems Approach to Revenue Diversification 

Scaled In the midst of all the statistics, the charts, the assertive tone, and the agreeing nods today at Susan Raymond's workshop at Fundraising Day - one message was clear: philanthropy is evolving. 

We're in an era of record unemployment rates and foreclosures. The "depression" that we endured (or are enduring depending on which newspaper or blog you follow) has traumatized us. Dr. Raymond calls this unique PTSD - "depression memory", because too many still remain afraid to be as generous, as trusting, or as engaged as they were years ago. Given all this, the way philanthropy is done urgently needs to evolve - or at least mutate in order to survive. In "Darwinian", the message is that it's survival of the fittest organization to compete and pro-create dollars that donors are holding much tighter. 


With the need to adjust in order to stay afloat, some organizations have accepted doing things differently. Cause-related marketing, for instance, has become an incredibly popular approach, in fact, it has quadrupled in the last 4 years. Also, mission related investments, where non-profits are aligning their missions with companies (clean energy companies for example) are beginning to be equally common. Basically non-profits, according to Dr. Raymond, have to take a more corporate approach. 


Think businessy.  

Create a business plan, not just a strategy. This involves thinking long term, rather than simply strategizing for the year (or - ahem - months). A business plan needs to "have legs", therefore, it's not just an applied plan, but something implemented with the idea that the organization is set for a few years. Additionally, non-profits should keep in mind their revenue base, their profit structure, and look towards diversification. 

Donors, while still remaining generous are looking at their money as an investment now. That is, donors are now more often looking to donate to organizations that can deliver a tangible return on their investment ("ROI" in business-ese). With respect to this, Dr. Raymond fears that philanthropy may become risk-aversive, but for now, "giving is not eroding".  

Holding to the old way of doing things will not work in the coming era. Accepting the business approach could help your organization thrive, so long as the mission continues to be your sail, and not viewed as an anchor (Dr. Raymond's analogy). You'll have to innovate, be more much more creative, accept technology and trends with a more open mind - otherwise, your organization will risk a fate worse than remaining unevolved - extinction.  
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