The article in the url below is interesting, I think, not because of the personal failings of the individuals running the nonprofit, but because of the gap in the market that their organization was intended to fill (Issues: Philanthropy, p196):
“Karnofsky and Hassenfeld, both 26, quit hedge-fund jobs last year and started a foundation [GiveWell] with $325,000 from themselves and their friends. Their mission was to gather and disseminate exhaustive data on the effectiveness of charities. GiveWell had found an important niche. American charitable donations reached nearly $300 billion in 2006, and charity is a classic long tail: 75% of that tally comes from individual donors. Unfortunately, most of it is dumb money. Large foundations have professionals who evaluate potential grantees, but their research is generally proprietary. Online resources such as GuideStar and Charity Navigator provide public ratings of nonprofits based on their IRS Form 990s but are skimpy on strategy or program details.”
The idea of accountability for nonprofits is important and these guys had a good business idea—they just messed it up on implementation.
“The worst thing about the GiveWell debacle is that it put at risk a service that's sorely needed in the nonprofit world. Credibility is hard to gain and easy to lose, and restoring it will be GiveWell's big challenge--tough for an organization aspiring to be an evaluator.”
The print version of the article also has some great statistics (missing from the online article)—It is amazing how much money Americans donate relative to people in other countries, both in absolute terms ($295bn, 75% of which come from individual donations), as well as a percentage of GDP (the US ranks first with donations the equivalent of 1.7% of GDP. The UK is No.2 with 0.73% of GDP).
Take care
Dave
Bill Werther & David Chandler
Strategic Corporate Social Responsibility
© Sage Publications, 2006
http://www.sagepub.com/Werther
When the Giving Gets Tough
A nonprofit startup set itself up as a watchdog -- then showed how easy it is to lose your own credibility.
Fast Company Magazine
From: Issue 125 | May 2008 | Page 65 | By: Anya Kamenetz
http://www.fastcompany.com/magazine/125/when-the-giving-gets-tough.html
