A post to Exponent Philanthropy's blog

A Pro Football and Venture Capital Approach to Philanthropy

Pro Football Hall of Famer and venture capitalist investor Ronnie Lott, and his wife Karen, founded All Stars Helping Kids 30 years ago, modeling his philanthropic efforts on the lessons learned playing football and investing in technology starts-up.

Photo by Mike Benson on Unsplash

Much like how venture capitalists invest in startups, All Stars invests in emerging nonprofits with innovative solutions to disrupt the cycle of poverty for Bay Area California youth, and increase the effectiveness of those organizations so that youth thrive, regardless of where they live.

But it was not just about the financial investment.

The philanthropic approach that undergirds All Stars was borrowed from Ronnie’s experience playing football, where a coach, a scout, or team would recognize a rookie, a player with potential, and provide them with support — coaching, mentorship with a veteran player, and training — to transform that rookie to an All-Star.

A venture capital inspired approach to nonprofits

When Ronnie and Karen started their organization, they approached their philanthropy by getting in the trenches with the nonprofits, building relationships with the leaders they were funding, and recognizing what they brought to the table. They were comfortable taking risks on early stage, startup organizations with innovative program approaches, and recognized quickly that not all their bets would pay off. They focused on organizational leaders with real potential to address the needs of youth in poverty. This core approach sets All Stars apart from other funders.

Ronnie’s post grid-iron experience as a venture capital investor in Silicon Valley also influenced his philanthropy, and he turned to what he knew: how early stage enterprises grow and succeed.

If you are an investor, do you just give one-year of funding and walk away? No. You recognize it will take time and you provide multiyear funding, you offer training and capacity building, you open doors to networks, funders and other investors. This approach is baked into All Stars’ philanthropic model.

The All Stars playbook

All Stars believes that driving change on complex societal problems takes more than simply providing a grant to nonprofits. Our approach is grounded in four key concepts:

  1. Cash: Three years of general operating support
  2. Coaching: One-on-one coaching and technical assistance
  3. Capacity Building: Quarterly capacity building trainings
  4. Connection: Peer networks and strategic partnerships

This helps build the strength and capacity of grantee partners to drive their financial health, scale and impact.

Each year, we fund a cohort of five Bay Area nonprofits whose missions focus on providing youth, particularly those living in poverty, with access to education, career readiness, and health and wellness programs. This networked support helps build an ecosystem of community-based organizations to push social justice work forward and help youth break out of a cycle of grinding poverty.

Each cohort partner receives three years of unrestricted, general operating support coupled with one-on one coaching and targeted technical assistance. We also offer quarterly capacity building activities, like trainings and workshops, and other learning opportunities through a peer network of former grantees and strategic partners. All Stars opens its extensive networks to grantees, making introductions and connecting them to people, business and other funding opportunities.

The return

This customized funding approach, inaugurated in 2012, has helped scores of nonprofits serve over 132,000 youth across five Bay Area counties. Not only did All Stars grantees see their revenue increase by 230% because of participation in the program, they increased the number of youth served by more than 400%. They created more than 300 new jobs to support their work and built local and national partnerships including the Gratitude Network, New Schools Ventures Fund, the Mason, San Francisco USD, Oakland USD and Outward Bound.

Funded organizations have demonstrated more sustainability, more resiliency and increased effectiveness. These supported nonprofits have been able to adapt and innovate as the economic, cultural, and environmental landscape shifts and changes. This methodology aligns with the current “trust-based philanthropy” movement in grantmaking. All Stars approaches its work with deep listening and high touch engagement, coupled with curiosity, humility and honest two-way communication. Staff follows the lead of the partner organizations by responding to their needs. The results are authentic partnerships grounded in a mutual relationship of trust and co-creation.

As Ronnie Lott reflected, “Everyone has rookie moments in your early years, nine out of 10 times there’s a mentor to help. The essence of our VC inspired approach to supporting nonprofits is more than giving money — it is support, encouragement, heart, courage, and inspiration and suddenly you find your way to being a great organization. We need more innovation, to inspire people to be stewards to help others. That rookie that says ‘I can help my community, all I need is a little help’, that is all we are doing.”

David Greco is a nationally recognized speaker, author and consultant on developing a culture of sustainability that incorporates full cost, sustainable business models and impact. Today David serves as Executive Director of All Stars Helping Kids providing early stage investments in emerging nonprofits working to help break the cycle of poverty for youth in the Bay Area.

Before his role at All Stars, he created and led the Full Cost Project to increase the number of grantmakers providing full cost funding, served as Interim President and CEO for Northern California Grantmakers, was the vice president of the Nonprofit Finance Fund. David is a professor in the Masters in Nonprofit Administration program at University of San Francisco and the author of “Think Money First! Ending the Culture of Scarcity and Achieving Real Impact.”

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