Real Leaders

New Thinking, Not New Technology, is the Path to Greater Social Impact

ice bucket challenge

The 2014 Ice Bucket Challenge raised more than $115 million for the Amyotrophic Lateral Sclerosis Association  – or ALS – up from donations of $2.8 million for the same period the previous year. And according to ALS, as a result of that funding, their scientists discovered a new gene – NEK1 – known to be among the most common genetic contributors of the disease. It’s a big deal.

And it was technology – specifically, the technology behind social media – that allowed the Ice Bucket Challenge to go viral and produce that result. Is technology the future of philanthropy?

In the Ice Bucket Challenge we are glimpsing the potential of momentary collective engagement, but at the same time, we are seeing the confining rules by which nonprofits must play, collectively imprisoned in an ancient way of thinking. On the heels of its fundraising success, ALS was immediately being scrutinized to make sure it didn’t spend a penny of the Ice Bucket money on anything but research. So when the enthusiasm fades, there will be nothing there to replace it, because investment in the replacement was forbidden. And there was no “Ice Bucket Challenge 2.”

And, as CNN reported, “while $115 million may sound like a lot of money, it may in fact not be. ‘By some estimates it takes about a billion dollars to make a new therapy,” said Dr. Steven Finkbeiner of the Neurocollaborative.

We are inherently averse to seeing humanitarian organizations spend money on anything other than “the cause,” as we define it, and we define it very narrowly.

I love the Ice Bucket Challenge as a thing unto itself. But for the sake of the ALS Association and everyone afflicted with ALS, we must dedicate ourselves to something far greater – yes, far greater than $100 million. We must aspire to a statistically significant increase in charitable giving as a percentage of GDP. And for that to happen we need much more than new technology. We need new thinking. Thinking that will give charities far more freedom to invest in a much greater result.

Charitable giving in the U.S. was $372 billion in 2015, but only about 15 percent of that, or $50 billion, went to health and human services causes – 85 percent went to religion, higher education and hospitals. $50 billion isn’t near enough to cure cancer, ALS, AIDS, Alzheimer’s, and other threatening diseases. It’s not enough to end poverty, homelessness, bullying, and all of the other problems charities address. Charitable giving as a dollar figure has increased dramatically over time. But then again, so has the price of a candy bar.

As a percentage of GDP, charitable giving has remained stuck at two percent in the United States – ever since we started measuring it in the 1970s. In 40 years, the nonprofit sector has not taken any market share away from the for-profit sector. What keeps us from increasing charitable giving? We are inherently averse to seeing humanitarian organizations spend money on anything other than “the cause,” as we define it, and we define it very narrowly. We condemn them for using donated resources on building market awareness or on fundraising, even though without those things, they can never reach the scale we need to fully address these massive social problems.

Without a systemic way to raise money and also build market awareness of its causes, charities have to pray that a fluke like the Ice Bucket Challenge – a zero-cost, once-in-a-lifetime, spontaneously combusting viral idea – will come their way. This is no way to change the world. Imagine if Tim Cook had to get people to dump ice on their heads in order to bring revenue into Apple – and had to figure out a new idea like that every six months.  The humanitarian sector has been taught to settle for scraps.

The $115 million-in-two-months Ice Bucket Challenge is our highest-profile success in years. Compare this to what some companies can make in a day: Apple sells $465 million worth of iStuff every single day. And Anheuser Bush sells $40 million worth of beer daily. Zero-cost fundraising ideas that spring up from out of nowhere and require virtually no investment are not sustainable because they rarely happen, and relying on them won’t result in the world we truly seek.

Ice melts. The big play here is a wholesale re-education of how the American public thinks about charity. We did it with pork (“the other white meat”), we did it with gay marriage, and we can do it with charity. We need an Apollo-like goal that challenges America to increase charitable giving from 2 percent to 3 percent of  GDP within the next ten years – and this, in large part, means allowing charities to make the investments in growth that they need (and not withholding donations because we disagree about what those mean). If you really want to challenge yourself for ALS and for charity at large, challenge the long-held belief that charities should not be able to invest a healthy part of your donation in growth, the same way that beer and cosmetics companies do every day.


More like this

Most Recent Articles