The annual conference of the European Venture Philanthropy Association (EVPA) is taking place in Geneva today. It is a sold-out event that draws over 500 participants from 23 countries. Ten years after this organization was founded, these two figures show that the concept of venture philanthropy is still very attractive even though it is not clearly defined. It comprises seven key elements: high engagement, tailored financing, multi-year support, non-financial support, involvement of networks, organizational capacity and performance measurement.
Venture philanthropy was developed in the 1990s in the United States, and then expanded to Europe and other world regions in the early 2000s. It originates in venture capital, and applies tools from the business world into social development. In its early days, venture philanthropy was presented as a different approach from ‘classical’ philanthropy, which was seen as not efficient enough in addressing worldwide social issues.
Ten years later, it is interesting to note that this ‘quarrel between the Ancients and the Moderns’ is outdated. ‘Classical’ philanthropy can easily meet the seven criteria that shape venture philanthropy; the only innovative element has to do with the nature of the financial commitment. Support now comes in various forms, from donation to loan with or without interest. Otherwise, ‘classical’ models of intervention that were established some time ago remain in use. In Switzerland for instance, the Oak Foundation, established in 1983, includes in its guiding principles a large number of elements at the core of venture philanthropy.
That being said, is venture philanthropy useful? Yes, for many reasons. First, it has expanded the palette of financial support for all kinds of projects, especially in social entrepreneurship. It has also fueled an exchange of ideas and forced a number of organizations to rethink their model. This is no small matter: two worlds are involved here: business and development, which ignore each other at best or hate each other at worst. Venture philanthropy has built bridges between these two worlds and this is one of its great achievements.
To conclude, let us say that there are as many philanthropists as there are philanthropies, regardless of their label, ‘classical’ or ‘modern’, ‘venture’ or not. The point is to define one’s philanthropic engagements according to one’s own value system, and to be ready to have theme evolve based on good or bad experiences, and that together they could help other people in need the best possible way.
Martial Paris is programme manager for WISE philanthropy advisors