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Get Ready for Disruption (in philanthropy).

Recently, Sean Parker (of Napster and Facebook fame) launched his philanthropic foundation, the Parker Foundation with a $600 million gift. With its introduction, he published a message to his peer group and in-directly to non-profit institutions throughout this country: the “hackers” are coming!

His editorial, published in the Wall Street Journal’s The Saturday Essay Sean Parker: Philanthropy for Hackers, lays out his view of the history of US philanthropic dynamics and the significant impact his peer group (self-identified as hackers) will have on it. His essay includes his recommendations to the “hacker barons” on how they should engage in philanthropy.  From my experience in both the non-profit sector and with the tech culture in the Bay Area, I find many of his observations very compelling and important to examine more closely.

The profile of the hacker philanthropist: young, intensely idealistic, analytical driven and hands-on problem-solver is a dangerous mismatch for today’s non-profit fundraising culture. Established by foot print of the industrial barons and perpetuated by tax laws, today most non-profits operate with a Victorian era sensibility. I think the engagement of the new “hacker barons” could be as dangerous as Marty McFly’s DeLorean in the old west.

Here is my list of the biggest issues non-profits need to think about if they want to be prepared to successfully engage this new breed of philanthropists.

  1. Parker encourages them to start early and seek “hackable” problems. How many non-profits are set up to engage young, brilliant, potential donors in deep discussion on mission work?  In my experience, donors are courted over time in a very specific manner, very much like a careful courtship ritual (think Victorian era).  Additionally, younger individuals that express interest in the mission are engaged with pretty basic “field work” or parties. These strategies will not captivate this new type of philanthropist one bit.
  2. He also encourages his peers to engage in politics and advocacy for the public good even it if is unpopular. This, coupled with the transparent nature of the world we now live in could put non-profits in the uncomfortable position of associating with a donor stirring up negative sentiment in the communities the non-profit is striving to serve. This could also wreak havoc in board relations - to say nothing of the other donors! How well equipped is philanthropic leadership to handle this level of diversity?
  3. Spend quick and bet big is another recommendation from Sean Parker. How many non-profits are set up to handle a large contribution that could eliminate their mission? Non-profits are as complex as any other type of entity. They don’t like to think of other’s that share their mission focus as competition until they are both going for the same donor. In the world of scarcity that many exist in, what else could one expect? How many of them have leadership with the grace and confidence to bring everyone to the table to optimize the sort of resources these result oriented donors can bring to their cause?

Who knows if Mr. Parker is right, but I do think he is on to something.  If you lead or participate in a non-profit, read his essay and start thinking about how to prepare for the disruption.  Some form of it is coming.

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