(from analogy with venture capital)

The practice of funding nonprofit efforts as if they were Internet startups; high risk, high yield philanthropy which supports new kinds of programs to improve the community. (The example cited by the Grantsmanship Center Magazine in their Fall 2000 issue is a nonprofit construction company which trained and employed homeless people.)

Venture philanthropy, instead of making grants year-by-year and reading the annual report for results, can infuse a nonprofit with the cash needed to ramp up its project. VP angels typically work closely with the nonprofits, as VC investors do, and focus on performance metrics such as the financial impact of the gift. (How much less did the city pay for social services to the families of the homeless people employed as carpenters?)

Established nonprofit groups are used to more autonomy in the way they implement grant projects; venture philanthropy may be best suited for new nonprofits needing an incubator to develop a program without having to run the logistics of the operation as well.

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