How About Funding Something a Little Innovative?

While the majority of donors may be satisfied getting a dollars worth of social impact for a dollars worth of contribution, some of you are greedy for greater value. Enter this month's Harvard Business Review (December 2006) which features the article "Disruptive Innovation for Social Change." According to the authors, "...too much money available to address social needs maintains the status quo" through organizations that are "...wedded to their current solutions, delivery models, and recipients."

The authors propose the remedy to this "misdirected investment" approach can be found in dispruptive innovations which challenge industry incumbents because they "...offer simpler, good-enough alternatives to an underserved group of customers." In the corporate sector, a great example would be Southwest Airlines which offers cheaper, no-frills service that makes you think twice about driving.

For social impact, referred to as "catalytic disruption," the article cites examples including: on-line AP courses for schools that couldn't otherwise afford them, community colleges which measure quality by indicators such as job placement, and fast, affordable, walk-in diagnosis for common health problems offered by nurse practitioners at CVS stores. Philanthromedia has been covering several others including microlending, KickStart's Play Pumps and the $150 (price was just bumped) laptop featured on the cover of today's New York Times.

The article correctly notes that investors seeking catalytic investments have few sources to rely on but once you read this article, you are likely to start seeing them everywhere.

How About Funding Something a Little Innovative?

Susan Herr