Just starting out in philanthropy and feeling a bit lost? You’re not the only one. Start here…
How To Be The Philanthropist That Makes A Difference
Save this for later.
The next time you’re approached by a charity, come back to this article.
That’s if you want to avoid the funders’ remorse, and feel confident that every penny you give is spent well.
Kafui and Steph will be our guides. Why them? Because they sit between the people you want to help and funders like you. Kafui is CEO of FAST London and Steph is Co-founder of Doceo.
Their charities have both benefited from strong relationships with effective philanthropists. By 2024, these relationships will help to change over 10,000 lives.
Based on these conversations, here are 4 ways that you, as a philanthropist, can build a trusting relationship with charity.
What is an effective philanthropist, and why does it matter?
Philanthropy is the desire to promote the welfare of others, especially by donating money to good causes. An effective philanthropist is a person who makes it happen.
Donating to charities is a great way for you to address problems you care about. Like outsourcing the problem solving to other passionate people.
If every UK multimillionaire gave 1% of their annual income, we would have £46.4m more for charities. But we have to make sure that £46.4m is well spent.
Next time you consider a charity, apply these 4 things to ensure success.
How To Be An effective philanthropist…
1. Prioritise trust
Prioritise building trust.
25% of HNWI say a lack of faith in how charities are run is a barrier to giving. Some of this is down to misconceptions, but some is because of legitimate issues in the sector. How do you decide who to fund?
Look for expertise, transparency and results.
At FAST London, Kafui is teaching young people trust, resilience and hope for the future. They live next door to the young people they help.
Funders visit the clubs, meet the young people and hear what the community says about their work. You want this level of access to a charity. But there’s more to it.
Doceo gives disadvantaged young people essential life skills to enter the workforce. They select programmes based on the young people’s personal experiences and conversations with recruiters. You want to understand their theory of change.
How do you build trust? Ask the right questions.
Ask to see impact data, annual reports, case studies, a theory of change, beneficiaries and more. If you’re interested, they should be able to share this with you.
If you can’t trust them, don’t fund them.
But let’s say you can trust them. What’s next?
2. Set effective expectations
Expectations help you achieve goals. But unrealistic expectations are premeditated resentments. Managing expectations is key.
Have guideline expectations in 3 key areas:
- Interaction with you
- Running the charity
- Solving the problem
Kafui highlights that “in a small charity 3 or 4 of key functions are done by one person.” If you’re expecting a weekly catch up call with a small charity, that would take a lot of time away from delivery.
And if you’re expecting to determine exactly how the charity spends your money, remember, they should be the experts. If you’ve built trust with them, you can trust their approach.
How can you set expectations? Have a kick-off call. Talk about plans for communication and spending. Listen but also challenge them. Take notes so you can refer back to them for accountability. Charities often have to adapt, but some can lose sight of their end goal. Clear expectations will keep your philanthropy on track.
3. Communicate regularly (enough)
Effective communication is crucial. Any relationship, personal or professional, requires input from both sides. Here’s why.
Your chosen charity wants to plan. You’re a part of their plans. They want you to see their work. You want to know your money is making an impact. You might have other skills that can help.
You won’t know any of these things if you only skim read a newsletter every 4 months. Your charity must engage with you, but you need to engage as well.
At Doceo, Steph says “At the bare minimum [expect] regular updates….All of our donors sign up for our mailing list.”.
If you invested in a business, you would keep up to date to safeguard your investment. Philanthropy works the same way.
Read the updates, reports, attend events, see any press, and ask important questions. You could volunteer. Every week? Not necessary. Once a quarter? That could work.
But what happens when you’ve done all the above, and it’s still not working. If you’re considering ending charity support…
4. Know your why
Remember why you care. In the words of Jeff Bezos, be “stubborn on vision and flexible on details”.
Knowing your “why” will keep you focused on the end goal, keep you inspired and guide you to make the most impact.
Steph has a great suggestion. “Know the impact that the funding is having and the impact that the lack of funding would therefore have.” A simple exercise like this can put into perspective the impact (or lack thereof) of your support.
Take a pen? Pause for 2 minutes and write down what you care about. Why did you start in the first place? Why this issue? It will reassure you to keep going on or highlight that it’s best to try a different charity. Whatever you do, don’t give up.
The people you set out to help still need you. You just need to find the best way to support them.
Society needs effective philanthropists. You can be one.
These 4 pillars will help you to maximise the impact of your cheque, and work exceptionally well with the charities you invest in.