December 29, 2008
Tips for New Philanthropists
Donors who are new to philanthropy often have well-intentioned but ill-informed ideas about giving. To help them make the most of their generosity, the blog Philanthromedia is this week posting a list of 10 tips from Paul Shoemaker, executive director of Social Ventures Partners, in Seattle.
Mr. Shoemaker takes aim at such common donor situations as a request that a gift be earmarked only for programs but not “overhead.” He challenges donors who hold this view, noting that it often excludes the support of staff members who run charitable programs: “Nonprofit organizations are businesses just like any for-profit entity, but with a social mission. They have to invest not only in the ‘product,’ but also in the systems, infrastructure, and operations to support the end product. “
He also urges donors not to give their money to a charity simply because of its financial neediness, because that could be a sign of poor management
As for the common observation that more nonprofit organizations should be run like businesses, Mr. Shoemaker cautions donors to consider the differences between the two entities before demanding charities take a businesslike approach.
“Nonprofits don’t need to be ‘run like a business’ when it comes to mission, effectiveness and resource allocation, etc.,” he writes. “But when it comes to efficiency, operational processes, measurement, etc., nonprofit organizations can learn important lessons from private sector business (and some certainly have). No matter how fuzzy or gray the social outcomes are, measurement is important. How else do you know if you are realizing your mission? “
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