A post to Exponent Philanthropy's blog

Horizontal Is the New Vertical

By Henry Berman, Exponent Philanthropy

The article below is featured in Exponent Philanthropy’s just released e-publication Outsized Impact, a first-of-its-kind report on trends shaping philanthropy with few or no staff. As practiced by small-staffed foundations, donor advised funds, giving circles, and individuals who choose to give big while keeping operations lean, this unique style of philanthropy is popular, powerful, and on the rise. In the report, more than a dozen thought leaders share their insights on how these philanthropists are achieving outsized impact across the country and around the world. Download the report

Historically philanthropy has, for the most part, operated in a vertical mode. At the top were the institutions and individuals holding the most money—and often operating with the most infrastructure. Below them was everyone else, including smaller organizations and individuals, and those seeking funding. The hierarchy, for those at the top, meant it was easy to be less connected to the communities and causes they supported. For funders at the bottom, it meant being less visible and less understood, working in the shadows of those at the top.

But no more.

For several years, the axes have been shifting, such that the vertical is now horizontal. Those who choose to practice their philanthropy by operating in a lean manner are now level with both larger, staffed funders and, the reason we are all here, recipients. To be sure, being on the same level is not really new. Many funders have for years, even decades, cultivated powerful and productive relationships with those they serve. What is new is the rise in prominence of philanthropists who operate with few or no staff, and the growing recognition of the power they have to accomplish tremendous good. These funders—whether giving through foundations, donor advised funds, giving circles, or individual checkbooks—are leveraging the power and agility that comes with operating close to communities and causes.

Philanthropy’s brave new world

Why the recognition now? The answer is not in the funds being dispersed but rather in all the extras that come with them. Philanthropists with few or no staff recognize the expanding economy of philanthropy. They see an economy where knowledge, intention, and passion are the new currencies. An economy where technical assistance, capacity building, convening, communications, and advocacy are tools as powerful as a checkbook. And they understand how much can be accomplished by using these tools to leverage the impact of their dollars.

When the long defunct Eastern Airlines operated a shuttle between Boston and New York, passengers purchased a ticket in flight. The ubiquitous drink cart was replaced with one that processed credit card payments, and the old joke was that all you got on the shuttle was a receipt. The parallel in grantmaking are the funders who may have issued grant checks in the past and waited for reports with no further interactions or idea sharing with recipients. Fortunately, these funders are a diminishing breed as today’s nimble funders, more involved than ever with their grantees, do just the opposite as the practice of philanthropy evolves.

Funders who choose to make a big difference while staying small have their feet firmly on the ground in their communities, directly beside those they fund. And not only does the horizontal axis position nonprofits as equals with funders, it means that all funders become colleagues as well. And once connections are forged, the opportunities for sharing and collaborations grow.

But how can we encourage those connections?

Forging connections

When Steve Jobs was CEO at Pixar, he oversaw the design and construction of a new headquarters. He created a space where everyone—animators, computer engineers, scientists, and executives—shared one roof. He recognized the power and potential of bringing people together. From his biography: “If a building doesn’t encourage [collaboration], you’ll lose a lot of innovation and the magic that’s sparked by serendipity. So we designed the building to make people get out of their offices and mingle in the central atrium with people they might not otherwise see.”

Bringing people together. Jobs did it at Pixar, a powerhouse in creating animated films. And Bell Labs, among the greatest innovation centers of the 20th century, also used its physical layout to bring people from seemingly unrelated disciplines together to share, collaborate, and, ultimately, develop the great technological advancements that changed our world.

In the same spirit of bringing people together, we at Exponent Philanthropy are committed to guiding philanthropists with few or no staff on their journeys, connecting them with one another, and championing their accomplishments and the manner in which they succeed. We recognize the powerful outcomes created by these donors, trustees, and philanthropic professionals. Theirs is the philanthropy of today, and the future.

We face great challenges as a sector. Nonprofits are called on to do more with less. Funders are pressed to demonstrate impact. By standing together with one another and those we serve, focusing on improving the world, there is nothing our philanthropy can’t achieve.

Download Exponent Philanthropy’s new report Outsized Impact for similar commentary from more than a dozen thought leaders.

Henry Berman became Exponent Philanthropy’s CEO in 2011, previously serving as acting CEO, board member, and committee member. Through his experience as a foundation co-trustee and Exponent Philanthropy member since 2003, he brings a firsthand understanding of the needs of members to his role. Follow Henry on Twitter @Berman_Henry.

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