The Business of Giving
Exploring philanthropy, non-profits and socially motivated business, from the Gates Foundation to your donation. A fresh look at the economy of good intentions.
January 9, 2009 3:08 PM
Posted by Kristi Heim
As director of Social Venture Partners for over a decade, Paul Shoemaker has lived through boom-and-bust cycles and their impact on philanthropic ambitions. He offered some perspective on SVP's current work and how the recession is affecting membership. SVP members each contribute $5,700 a year, pooling their funds to make grants primarily in childhood development and education.
Q: What is a social venture?
A: In our definition, it's a 501(c)(3) non-profit. Other folks use that to mean a social enterprise, a non-profit such as FareStart, the Northwest Center, Pioneer Human Services, which are revenue driven with a business that underlies the social work. Even a third way might mean socially responsible investing. Or a for-profit company like Pura Vida Coffee or Newman's Own. (Newman's) sells $100 million, and 100 percent of the profits go back into social purpose organizations. It used to be just private sector companies and non- profits -- you're either in one or the other. In the last 10 years, there's this emerging hybrid.. . whether that is Pura Vida or clean energy or a company that also tries to act in a socially responsible way, such as Starbucks or REI.
Q: How has your membership changed through the economic ups and downs?
A: We grew from 0 to 200 very fast. The dot com bust comes along, and we take a dip. Our correlation with the market is very high. We now have 255 members. In the last 10 years it was as low as 230 and as high as 290... In the last six months we've had about 30 people drop off..
Without a doubt it's a different game now... we're deficit spending this year. We want to keep grant making at same level because of the need that's out there. You can't deficit spend forever.
Every organization, non-profit, for profit or whatever... we're all going to have to be sharp-eyed business managers and deal with reality as it is, not as you wish it were.
Q: How will the downturn affect the ambitious global goals set recently by philanthropists?
A: At least in the short term it has to make it a little bit harder because there are going to be more people in need, and the people helping solve the problem won't have the financial capital to do it.
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