Alliance Online - June 2007

Philanthrocapitalism reigns in the age of Philanthropy 3.0

Olga Alexeeva

EVENT 6th Annual Global Philanthropy Forum
Date 11-13 April
Venue Mountain View, California, USA
Theme Financing Social Change: Leveraging Markets and Entrepreneurship

The Global Philanthropy Forum, an annual gathering of private philanthropists, companies and foundations, took place this year not in the respectable auditoriums of Stanford University but in the headquarters of Google, famous for its innovative approach to business, philanthropy, office space and internal corporate culture. Over 600 guests from many states of the USA and a number of other countries wandered around a children’s playground, numerous cafes and triangle-shaped stools, and bumped occasionally into Google programmers and managers who, being fully absorbed in their laptops, probably didn’t notice the commotion.

The Forum focused this year on Financing Social Change: Leveraging Markets and Entrepreneurship. It provided a diverse agenda and an excellent selection of speakers, from the founders of Google, Larry Page and Sergei Brin, to the President of the Rockefeller Foundation, Judith Rodin.

A dot.com view of philanthropy

And it was Judith Rodin who defined the essence of this Forum’s agenda in her keynote address on ‘The Changing Practice of Philanthropy’. Inspired by the high-tech surroundings of Google headquarters, she defined the history of philanthropy in the USA in dot.com terms, starting with Philanthropy 1.0.

Philanthropy 1.0, according to Judith Rodin, was the giving of the ‘fathers’ of modern American philanthropy: John D Rockefeller, Andrew Mellon, Henry Ford, etc, and it was giving focused on creating necessary and important infrastructure in the USA: museums, hospitals, universities and schools. Philanthropy 1.0 donors invested in increasing literacy and supported the first initiatives to combat the infectious diseases that were causing a high mortality rate in the USA. Philanthropists 1.0 did not only focus on local US problems, they launched projects outside the USA as well. From the beginning, their work was truly global.

The Second World War and its aftermath brought a new generation of philanthropists (Philanthropy 2.0), who concentrated on working on the ground, developing and encouraging the non-profit sector. Philanthropy 2.0 expanded to include the emerging states of Africa, South America and Asia, helped to adapt US giving to global realities, and supported civic action and innovation among NGOs.

Now, said Judith Rodin, we are in the era of Philanthropy 3.0, which began with the end of the Cold War, the globalization of the economy, and the technology revolution. Philanthropy 3.0 is focused on new ideas and communication, and on specific highly effective initiatives. In its structure of giving, Philanthropy 3.0 is moving from programme-related grantmaking to an open architecture of giving, with a greater involvement of donors in beneficiary projects. As one example of this, Rodin presented a recent alliance of the Rockefeller Foundation, her own foundation, and the Gates Foundation – the Alliance for a Green Revolution in Africa.

Philanthropy 3.0 as a brand and a concept quickly took off at the Forum, with discussions and presentations focusing on the innovative aspects of giving, aspects that make modern philanthropy different from that of the 20th century.

Larry Brilliant, CEO of Google.org, added his perspective, highlighting at least two characteristics of new philanthropy: it is the philanthropy of living benefactors rather than the giving through ‘wills’ of the past, and its donors give greater attention to such topics as climate change and global health. He also pointed out that philanthropy is now defined much more broadly than before and includes all new forms of social investment, programme-related investments and venture philanthropy. It demonstrates a much wider collaboration across sectors, to the point of convergence of the social and private sector, something which we may witness in the near future. He noted, however, that not all problems can be solved through private-social partnerships and social investment and that policy-making still requires significant attention.

Philanthrocapitalism reigns

But … attention to policy and research giving, and to other more ‘traditional’ forms of philanthropy, was in fact quite scarce at the Forum. Philanthrocapitalism reigned and numerous presentations showcased more and more examples of blended private and social enterprises. On closer scrutiny, some of these examples did not prove to be the shining examples the presenters claimed them to be, but the audience, enchanted with ‘new giving’, did not pay attention to detail.

Beyond philanthrocapitalism as a new form of philanthropy, the Global Philanthropy Forum this year also looked at global warming and at environmental issues in general. Timothy Wirth, President of the United Nations Foundation, stressed the importance of global warming, while James Cameron, Vice Chair of Climate Change Capital (UK), pointed out that we can finally see some signs of policy change by governments towards global warming, but that current efforts are still drops in the ocean.

A global forum in name only

Despite being based this year in a company with a truly global reach, the Global Philanthropy Forum lacked global representation. Only about 40-50 out of 600 guests came from other countries, mostly from Canada and Western Europe. The few donors from Russia and South America served as the exception rather than the rule and, symbolically, one donor from Asia couldn’t, in the end, get a place.

Meanwhile, unnoticed as yet by the Global Philanthropy Forum, a new era in the development of global giving is coming – let’s call it Philanthropy 4.0 – philanthropy with a global face as well as a global reach, diverse in geography, race and gender. Hopefully, the next time it convenes, the Global Philanthropy Forum can become more global and embrace views and ideas not only from the USA and the UK but from the rest of the world too.

Philanthropy 3.0 is a great concept and an inspiring idea, clearly fed by ambitious and innovative new entrepreneurs, especially from the US West Coast. But, separated from the realities of a complicated world, it runs the risk of repeating the fate of a dot.com bubble, ending in great disillusion with limited impact from its innovative investment.

But I admit that I loved the energy, ambition and focus of the new philanthropists. I was sitting in a Global Philanthropy Forum plenary and looking at a photo of Larry Page, one of the founders of Google, in the conference pack and then realized he was sitting right next to me in the audience – a young man in jeans with a pack of instant noodles in his hand, and one of the wealthiest people in the world. Russian billionaires don’t yet tend to spend their time listening to discussions about global warming with a cup of instant noodles in their hand.

Olga Alexeeva is Head of CAF Global Trustees. Email oalexeeva@cafonline.org

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