Category: Donor Engagement

Want new donors? Check out the importance of diversity-related data.

Sarat PratapchandranLeave a comment

Diversity-related data is key to finding new donors

The term “culture of philanthropy” is boring. Instead, let us focus on creating a culture shift by incorporating Diversity, Equity & Inclusion (DEI) data in our conversations with donors.

The “culture of philanthropy” has been around for over a decade, repeated in case statements, campaign materials and in conversations with internal and external constituents. I haven’t had any donor ask me what that meant as it still seems a fancy word to me.

Culture shifts happen when strong leaders influence every nook and corner of an institution with a common purpose. This purpose resonates with every constituent regardless of race, ethnicity, age, sexual orientation, gender identity and other identities that make us unique but part of a whole. DEI-data is critical here.

However, we ignore DEI data and go back to the same old prospect pools, the “wells” as we call them, reaching out to the same constituents again and again.

Retention is good but over-retention wont bring anything new to the fold.

Do we have meaningful insight on DEI data regarding our constituents? How many of our boards have had the same members for over half a century? How many times have we scrambled to check boxes when a grantor asks for the diversity of our board?

The practice of adding namesake women and minorities to boards for the sake of diversity numbers is nothing new to the nonprofit world.

However, the times have changed and in an excellent data guide, the Association of Professional Researchers for Advancement (APRA) talks about the purposes of Diversity, Equity & Inclusion (DEI) data, how it needs to be collected, used and stored. The APRA Ethics and Compliance Committee Diversity, Equity and Inclusion (DEI) Data Guide is a very useful resource that can help us look at donor pools with a different lens.

DEI data can help us diversify our boards, build better donor affinity groups, understand cultural nuances, tailor new types of volunteer engagements and, as the guide says “help further policies of non-discrimination.”

Any collection of DEI data should ask the question “Why” and it must have a business reason. Transparency is key as we design questions, responses are voluntary, and we must include a way to obtain informed consent.

DEI data can provide insights to frontline fundraisers on building relationships with new donor pools, asking them culturally competent questions, and getting to know people in a more meaningful way. This process will also help us reduce our biases, both conscious and unconscious.

While DEI-related data can give us a wealth of information, the APRA data guide teaches us how to use it ethically, for what kinds of purposes and how it needs to be stored.

This is critically important as we live in a world full of data breaches. However, DEI data, if used well can engage and strengthen our relationships with new donor pools.

At the end of the day, we all seek inclusion and belonging. What better way than to harness DEI data to include new constituents we had never thought about?

.

Why do the rich give after they exit their ventures?

Sarat PratapchandranLeave a comment

Entrepreneurs acquire enormous wealth after exiting their businesses through sales, IPOs or liquidation. But what happens after they exit their ventures?

In a study, “After the harvest: A stewardship perspective of entrepreneurship and philanthropy,” in the Journal of Business Venturing (2017), authors Blake D. Mathias, Shelby Solomon and Kristin Madison found 4 key reasons why the rich redistribute their wealth after exiting successful ventures.

  1. Intrinsic motivations: They want to do meaningful work after making large amounts of money.
  2. Identification: The rich want to have a sense of identity and advance a cause they believe in.
  3. Personal power and long-term orientation: They crave for an opportunity to influence future generations.
  4. Stewardship norms: Most feel they have a sense of obligation to give back.

This award winning study analyzed “The Giving Pledge” letters of 99 entrepreneurs and separately conducted in-depth interviews with 19 of them. In 2017, when the study was conducted, there were 142 individuals, 70% of whom were entrepreneurs who had signed on to the “The Giving Pledge.”

Today, there are over 200 individuals from 23 countries who are part of the “The Giving Pledge,” and have committed a majority of their wealth to philanthropy or charitable causes.

The study found that the rich display an innate responsibility to “act as stewards of their communities.”

And, this is very evident in the way latest entrants to “The Giving Pledge” like MacKenzie Bezos have committed to pledging over half of the $36 billion she inherited in Amazon stocks. “I have no doubt that tremendous value comes when people act quickly on the impulse to give. No drive has more positive ripple effects than the desire to be of service,” she says in her Giving Pledge letter.

“In addition to whatever assets life has nurtured in me, I have a disproportionate amount to share,” Bezos adds.

This reminds me of a well cited Princeton study “High income improves evaluation of life but not emotional well being,” that showed the world that anything beyond a $75,000 annual income will not buy you emotional well-being. Authors Daniel Kahneman and Angus Keaton found that emotional well-being rises with income but anything beyond $75,000 is not going to buy you happiness.

However, for those who have made so many more multiples than $75,000, their entrepreneurial exits, often called harvests, trigger their ability to give.

And, social expectation will prompt them to give, be good stewards of society and perhaps buy a little happiness on the way. But one thing is very clear: it is insanely difficult for the mega rich not to give!