A few months back (yes, I know, I’ve been busy), Sean Parker wrote an Op Ed in the Wall Street Journal called, “Philanthropy for Hackers” Like a lot of things I read these days about philanthropy, it struck me as hot nonsense. I went back to it yesterday, and as is often the case with things I hate that I read a second time, there were parts of it that had some redeeming value: a call to stop viewing philanthropy as a tax-planning tool with some altruistic side-benefits; encouraging a tolerance for experimentation and failure, and underscoring the need to focus on policy, something which many techno-libertarian hacker types are loathe to do. However, the thing that still made me mental about this op-ed the second time around was this: Parker places the hero philanthropist at the center of the story of social change and scientific innovation. Our hero philanthropist must look for “hackable opportunities” in areas he* understands well enough to “spot problems that are solvable.” He must resist the urge to “institutionalize” lest he lose his ability to continuously change directions as he identifies (or perhaps actually creates?) and funds the innovations that will solve the world’s most pressing problems. None of this would be worth getting worked up over if it wasn’t the latest manifestation of a disease that seems to affect 95% of young male philanthropists: what I will call “Good news, dummies, I’m here” syndrome. And GNDIH syndrome basically wipes out any value any of these young men create in their first five years of giving
GNDIH syndrome has a few distinct elements:
Before I go through these one by one, allow me to emphatically agree with Mr. Parker on one point. Most philanthropic institutions are everything he says and more: risk averse, bureaucratic, and overly focused on self-preservation. But everyone knows this, and a few smart people are already trying to do something about it. Criticizing old-line philanthropy is like criticizing the post office, or Amtrak or academic tenure or that album Metallica made with Lou Reed. Most of us already agree with what you are saying, so saying it out loud isn’t a courageous act, and simply saying it is not actually a step toward correcting it. So go do something about it. Only, that isn’t as easy as it looks.
OK, on to the three symptoms of GNDIH syndrome:
Making big proclamations and/or commitments before actually doing anything
Listen, recently minted billionaire, I know you are the smartest person you have ever met, and I also know you are coming off a run where you did something amazing that made you all this money. However, I also know this. You are terrible at philanthropy. It’s nothing personal. In a few years you may be great at it, but right now you have no experience, no networks, no organization or infrastructure behind you and no experience managing philanthropic relationships to impact. You have a thought or two on the kind of things you want to support, but I guarantee your first few grants are going to go worse than you think. I know you are terrible philanthropy because every young genius (or old genius) in Silicon Valley has fallen on his philanthropic face out of the gates. I know because I have worked for most of them. It is not that surprising that Mark Zuckerberg’s foray into Newark was a failure, instead it is surprising that he did it (an no one around him stopped him) without looking to the experience of every smart, wealthy successful man that came before him. Also unsurprising is what he has done since the failure in Newark: made grants closer to home in the Bay Area and stayed out of the press until he has some experience of substance to talk about.
Mixing up contempt for existing philanthropic institutions with a contempt for organization-building and philanthropy as a discipline
Look, like I said, most foundations are terrible. (No, no, not your foundation. Your foundation is great. Please hire me. You guys are great) But that doesn’t mean philanthropy is easy and doing it well at scale requires an organization to support it. A brilliant young man with a checkbook can’t do the work, especially if he has other interests, and yet, time and time again they speed past the hard work of building an organization to do the work necessary to be successful: the opportunity identification, diligence, management and evaluation necessary to support real change. Just because most foundations are crap, that’s no excuse to not build the infrastructure you need to be successful. Just don’t make it crap.
Placing the philanthropist at the center of the narrative of social change
OK, this is the absolute most important point. I named the post after it.. You are not the hero of this story. Mr Parker says you are. Your PR person says you are. Everyone asking you for money says you are, but you aren’t. I understand why you are confused. For the past 10 or 5 (please god, don’t say 2) years, you have been an entrepreneur. You were at the center of every decision. You understood that market better than anyone. You were the hero!! Well, Mr. Parker writes this article saying, “Hey, come over here and be the hero of this story by being a philanthropist!” Well, Mr. Parker is a goofball. Imagine a venture capitalist arriving in Silicon Valley saying, “Good news dummies! I’m here! I have big ideas for how to revolutionize tech and I’m looking to fund companies that fit those ideas!” Goofball, right? Because a VC’s job is to follow everything entrepreneurs are doing, make smart bets on the best ones, support those companies and protect their investments. No one would trust an investor who is trying to execute on his own vision of technological progress, and yet folks like Mr. Parker seem to encourage philanthropists to do just that. Philanthropists are an essential part of the ecosystem, but they are no more the center of the narrative of social change than VCs are the center of the narrative of technological progress.
The venture world has a distinct advantage over philanthropy in weeding out GNDIH thinking. In VC, good opportunities are oversubscribed, so if you’re not creating value as an investor, none of the deals you want in on will take you. But in philanthropy, no one will tell you when you’re acting like an asshole. You open your checkbook and start blathering on about all the things you know about how to help impoverished women farmers and 9 times out of ten, they’ll just smile and nod and hope your money isn’t more trouble than it’s worth.
This fundamental misunderstanding by successful entrepreneurs of the supporting rather than primary role of philanthropist is THE thing that hamstrings most young men when they get here. There is plenty to reinvent about philanthropy, but being a better funder is a totally separate discipline from actually innovating solutions to specific problems. Your success or failure will be entirely dependent on whether you can build an organization that identifies great organizations, funds them in a way that expands and amplifies their impact, connects and supports them, evaluates what works and what doesn’t and then folds that into the work going forward.
OK, so what SHOULD you do?
No seriously, shut up. Future you wants you to shut up even more than present me does.
Don’t make big commitments early. Start with small experiments that help you build knowledge, networks and internal capacity. Focus on learning, not only about issues and organizations, but also about the kind of philanthropy that is going to keep you engaged for the next few decades. Poor Mark Zuckerberg found out too late that he has absolutely no interest in the minutiae of municipal politics or labor negotiations.
Build a world-class organization
Philanthropy IS chronically under innovated, but far more at the funding level than at street level. There are very few great funding organizations. Build one, whether it’s a foundation or an investment fund. Track what works and what doesn’t not just in terms of outputs and outcomes, but also in terms of the kinds of issues and groups that are best suited to the organization you are building (and vice versa)
Spend 50% of your time on philanthropy, or spend 0.5% of your time on it. Please don’t spend 5% of your time on it.
Throw yourself into it, or delegate it to someone you know and trust. No one wants a boss who shows up once a month.
Invest in organizations, not ideas
This venture capital truism that you invest in teams not ideas is just as true in philanthropies. Your job as a philanthropist is not to have new ideas. It is to identify, support and expand great organizations. And that is hard enough.
Be as externally consistent as possible (internally too if possible)
New philanthropists are notorious for radically shifting strategy (and staff) every 12-24 months. Some of this is unavoidable for a relatively young person/organization learning on the fly, but an organization continuously relaunching is a pain in the ass to deal with (and, ahem, to work for). It minimizes any internal capacity you are building, it diminishes your value to other organizations and the best organizations, which do have other options for funding, will eventually avoid you.
Speak up when you have experience to share
Even then, don’t make the story about you.
Seems pretty simple, right? Except almost no one gets this right. Almost everyone, through a combination of hubris and naiveté, wastes the first five years of their philanthropy in disturbingly similar ways. I expect I’ll go into more detail in the future about specific cases, but for now my hour is up and I promised myself I would post this today, given my long hiatus from writing.
If you happen to be a newly minted titan of philanthropy, feel free to email me. I am fun to talk to, as long as you promise to not use the phrase “This needs to be managed more like a business."
* Yes, "He." Find me a woman acting this way and I'll happily go back and edit my pronouns.
Patrick Maloney lives in Portland, OR where he helps nice people working on cool stuff. He tries to limit his blogging to things about which he knows something.