What Causes Technology Donors to Give Up on American Charities

April 01, 2008

What Causes Technology Donors to Give Up on American Charities

The entrepreneurial founders of global technology companies, who have changed the world in terms of how information is shared, are now leading a similarly radical change in how philanthropy is practiced, says Emmett D. Carson, president of the Silicon Valley Community Foundation, in Mountain View, Calif.

Speaking at the annual conference of the Association of Fundraising Professionals in San Diego on Monday, Mr. Carson — who led the Minneapolis Foundation before spending the past 14 months working with Silicon Valley entrepreneurial donors — outlined a dozen characteristics of Silicon Valley donors that have implications for the way in which fund raisers and other nonprofit leaders work on a day-to-day basis. Among them:

Speed and adaptability. Entrepreneurs must frequently remake their companies, fire staff members, and replace them, sometimes on a weekly basis, Mr. Carson said. That approach is in striking contrast to the lengthy decision- making processes at many charities. “Concepts like committee review don’t wash,” he said. “They don’t respond to the excuse that you are a nonprofit” and must do things differently.

An independent streak. Fund raisers are used to seeking the endorsement of leaders who then influence their peers to give, but most entrepreneurial donors “celebrate their own thing, not the group thing,” said Mr. Carson. They pick one or two causes and “follow their own drummer not the pack.” In fact, he added, their attitude is likely to be, ‘If you have others, you don’t need me.’”

An unprecedented demand for inside information. Mr. Carson said that the degree of involvement technology entrepreneurs seek can seem extreme to charity leaders. “‘Why don’t you come on staff?’ you might want to ask,” he said. “They ask for staff memos, they want to develop strategy with you.”

A high tolerance for risk. Unlike many charities, technology company founders, Mr. Carson said, “risked it all and won and sometimes lost. They are used to betting the farm. They ask, ‘Why won’t you bet it all? So what if you fail, we’ll learn some things.’”

Expectation of diversity. Entrepreneurs who have created and worked in global companies are “Indian, Asian, Filipino, and not all white. They’re younger, more diverse and comfortable with that,” Mr. Carson said. Instead of the typical conversations about diversity in the nonprofit world that focus on questions such as why more minorities are not in leadership jobs, global entrepreneurs think that the best ideas come “in any size, shape, and color,” Mr. Carson said. “So if your organization is all one color, they wonder if you’re getting the best ideas, and not just the hierarchy.”

Those characteristics and others, Mr. Carson said, make global entrepreneurs impatient with operations at many charities in the United States. That is one reason, he said, that philanthropists like Bill Gates and others have found overseas projects to be appealing.

“They can go to Africa and solve problems very easily,” he said. “Committees and processes and regulatory commissions are not appealing to them. You have to compete for them because they are global citizens.“

— Holly Hall

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What Causes Technology Donors to Give Up on American Charities