Design Principles for Donors #6: Which Way?

Uncategorized Nov 24, 2021
 

Which way do you want to jump in when it comes to gearing up your giving?  This is one of the design fundamentals for donors.  

Answering this question starts with stepping back from the common labels of “funder” and “grantee.” Instead, let’s look at four functionally defined roles for advancing social change.  Whatever issue or challenge you are focused on, this post and the worksheet that goes with it will help you understand which of these practical roles you are best positioned to play within the change agent ecosystem. 

Four Functional Roles In the Work of Social Change

 

Stakeholders—this is  the broadest category, including any and all people with an interest in the issue in question.  For example, everyone living in the Colorado River watershed is a stakeholder when it comes to water conservation and allocation policies. 

Entrepreneurs—these are people with an idea AND an operational plan for making change on the issue in question.  Entrepreneurs may be first movers, but they also typically seek to organize and enlist others in pursuit of impact.  Take, for example, the work of climate activist Greta Thunberg organizing a youth-led movement of school strikes and other direct actions to protest inaction on climate change.

Accelerators—these are people using their resources (financial and otherwise) to get behind someone else’s plan for making change on a given issue. McKinsey Scott’s philanthropy ($5.7B in 2020 to 300 or so non-profits working across several distinct issue areas) is a classic example.

Advisors—these are people using their knowledge, and perhaps also their social, political and cultural capital to help others make better decisions in pursuit of positive impact on the issue at hand.  In some cases people play this role as their professional focus—as philanthropic advising firms do.  In other cases, non-profit leaders do double duty as informal advisors to philanthropic institutions.  Similarly, some experienced foundation executives and individual donors spend much of their time advising fellow donors as well as social entrepreneurs.

 

Which Forms of Change-Making Capital Are You Drawing On in Your Giving?

When you think about gearing up your giving you are most likely thinking about the money you’re planning to give away.  But money is far from the only form of capital you need to make change on our toughest challenges. Wealthworks, a project of the Aspen Institute has a helpful schema of eight forms of capital.  This is a useful list when applied in the context of your philanthropy. What is your stock of change-making capital—in all these various forms?

  • Individual capital (time, physical health, autonomy to act, personal skills and mindset)
  • Intellectual capital (ideas, knowledge, theory of change)
  • Social capital (level of support & engagement from others through networks, relationships etc.)
  • Cultural capital (proximity and patterns of perspective that provide insight and guidance on the way forward, including shared systems of beliefs and world views)
  • Natural capital (assets in the natural environment that can be leveraged to contribute to the solution)
  • Built capital (physical infrastructure needed to carry out the giving program)
  • Political capital (alignment and level of support from key political actors)
  • Financial capital (money and other stores of value with an immediate exchange value in currency)

Which of these forms of capital contribute the most to your impact as a philanthropist?

And which of these forms of change-making capital contribute the most to your sense of fulfillment in your giving?  Which do you get the greatest joy from giving away?

Which kinds of change-making capital do the other players in the ecosystem possess?  It’s important to consider this broader allocation of capital when determining how you can add the most value to others through your giving.

Which Ways of Giving Make the Most Sense for You?

The four roles in the change agent ecosystem correspond with four ways of giving.  A key question for you as a donor is:  Which style of giving best maximizes your impact AND your sense of joy and fulfillment?  Getting your giving style right is key to landing in the sense-making quadrant as you gear up your giving.

Entrepreneurial Giving: You and your immediate team are the ones generating the ideas as well as the operational strategy for making change. Your path to impact and fulfillment is about mobilizing and engaging others around an effective plan.   Then you work that plan with all you’ve got. The entrepreneurial style also fits those who pursue their vision for social change by directing their business operations towards a social purpose. Take for example Australian mining entrepreneur Andrew Forrest. He is putting his $8B fortune into play with dramatically outsized investments in R&D that bet his company’s future on clean hydrogen technology and carbon-neutral steel.

Accelerative Giving: Your path to impact and fulfillment is about being a talent spotter. You find great leaders and organizations with great ideas for making change on the issues that matter most.   Then you do everything you can to speed them on their way. There is plenty of scope for being strategic in this role, but more at the big picture level, not so much the operational and programmatic level. 

Advisory Giving: You are focused on helping others generate the best possible ideas and decisions on their own terms.  You draw on your expertise, access and know how to do so.  This is not typically your primary giving style if you define yourself as a “donor.” But it may still be a vitally  important part of how you operate and add value to others. An advisory style of giving may be especially important for you if your “wealth stock” includes a lot of intellectual, social, cultural or political capital.  

Stakeholder Giving: In this style of giving, your own experience and proximity to the issue is a key source of inspiration. Some of the most effective entrepreneurial funders are also stakeholders with proximity to the issue they are working on. Take for example Dustin Moskowitz and Cari Tuna. They focus on reshaping the culture of philanthropy by helping fellow donors give more effectively. 

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These four giving styles are not mutually exclusive. On any given issue it may be possible to show up as an advisor in some instances, and an entrepreneur driving a plan in others, as well as an accelerator of others’ efforts in still other ways. Similarly, perhaps you are already stakeholder on the issues that matter most to you, with an interest in the outcome no matter what other roles you play.

If you are still looking for clarity on which of the 4 giving styles are most suited to you, here are some further questions for reflection.

  • If you could only play one of these 4 roles as you move forward with your philanthropy (stakeholder, entrepreneur, accelerator or advisor), which would it be?
  • And which of these giving styles matters least to your impact and sense of fulfillment?
  • Think about your best experiences bringing joy and impact through your giving so far? Which roles were you playing then?
  • Is there a role others have been asking you to lean into more? In which of these roles do you have the most untapped potential?
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