nonprofits

A Philanthropy Reboot in Silicon Valley

LAURA ARRILLAGA and Marc Andreessen are practically a royal couple around here. But when they met, on a New Year’s Eve date in 2005, Ms. Arrillaga didn’t care that Mr. Andreessen had made a fortune in Silicon Valley.

She cared whether he was giving money away. “One of the first questions I asked him on the night we met was what he was doing philanthropically,” she recalled.

Not your usual flirtation, but also not your usual romance. She is the daughter of a real estate billionaire and ended up marrying an almost-billionaire: Mr. Andreessen, co-founder of Netscape.

Yet the question she posed that evening still resonates. She is encouraging tech titans like her husband to become as famous for giving money as they are for making it.

Stars here often get rich in their 20s, but the tech industry over all has been criticized as being stingy when it comes to public charity. Some executives, like Bill Gates, wait until they retire to become active philanthropists. Others, like Steve Jobs, may not give much publicly during their lives. And while there is evidence that the valley is more philanthropic than it seems, Ms. Arrillaga-Andreessen, 41, says more could be done.

“The word ‘philanthropy’ brings up an image of somebody who’s had an illustrious career, has retired and is giving to highly established institutions that may or may not have ivy growing up their walls,” she says. “I personally have felt the need to give philanthropy a reboot.”

While attending the Stanford Graduate School of Business, she created a business plan for an organization that would teach philanthropy and make grants using strategies borrowed from the venture capital industry. The group, SV2, now has 175 donors who have financed 35 early-stage nonprofits over 13 years and last year gave away almost $500,000.

Ms. Arrillaga-Andreessen has taught a Stanford class on strategic philanthropy for 11 years and is on the board of her parents’ foundation. She started a center at Stanford to connect academics and nonprofits, and this fall published a book, “Giving 2.0: Transform Your Giving and Our World.”

But her most powerful weapon may be her personal cachet. Her father is John Arrillaga Sr., a commercial real estate developer who transformed this area from farmland into techdom’s epicenter. Her mother, Frances, was a philanthropist. Today she and Mr. Andreessen make a glamorous pair. They live in a grand home filled with abstract and pop art she selected. (She has two degrees in art history.)

Ms. Arrillaga-Andreessen has the ear of billionaires. She advised Mark Zuckerberg, founder of Facebook, and his girlfriend, Priscilla Chan, on their $100 million donation to Newark public schools, and is working with Dustin Moskovitz, another Facebook founder, and his girlfriend, Cari Tuna.

She is also close friends with Laurene Powell Jobs, Mr. Jobs’s wife, who many assume will take responsibility for the family’s philanthropy.

Meg Whitman, the former eBay chief and gubernatorial candidate who now leads Hewlett-Packard, has taken advice from Ms. Arrillaga-Andreessen on her family’s giving. “What’s different here in Silicon Valley is people recently have made a significant amount of money much earlier in life,” Ms. Whitman said, “and I think Laura is beginning to change the dynamic here.”

Ms. Arrillaga-Andreessen said she was drawn to philanthropy because of her mother’s early death from cancer. “That inspired me to make a commitment to myself and to her and to God to live a life of service,” she said.

Philanthropy is more meaningful, she says, if people follow their passions but also do intensive research and evaluation.

Bradford K. Smith, president of the Foundation Center, a research organization, said: “This is a field that can run aground on the shoals of being excessively personal and anecdotal or being excessively strategic and analytical, and she weaves that middle ground in a way that speaks to a lot of people.”

Her philosophy fits into the Silicon Valley gestalt. When entrepreneurs, engineers and investors here give to charity, they are most comfortable with the strategies they apply in their day jobs. The Omidyar Network, for instance, started by the eBay founder Pierre Omidyar and his wife, Pam, uses a market-based approach to invest in for-profit companies and give grants to nonprofits. So does the Skoll Foundation, started by Jeff Skoll, eBay’s first president, which finances social entrepreneurs by using the same criteria that venture capitalists use to invest in start-ups. Nonprofits like Kiva, DonorsChoose.org, Samasource and Causes use the Internet to connect people in need with donors, jobs or supporters.

Such endeavors have failed to silence critics who say Silicon Valley isn’t generous enough.

“Society can’t wait,” said Leslie H. Wexner, founder of Limited Brands, who says he gives 10 percent of his time and pretax income to the United Way, Ohio State University and other causes. “It’s sad there are so many entrepreneurs, business successes and venture capitalists who give no thought to society.”

Others here say they are too busy building businesses when they are young to focus on charity, and view their products as their contributions to the world.

Article source: http://feeds.nytimes.com/click.phdo?i=77ddc68c2361de41f5e91ec77eaef536

Salvation Army Bell Ringers Accepting Mobile Payments

The Salvation Army has begun shifting into digital donations, as fewer and fewer shoppers carry much change or bills.

This year, the charity is testing the use of Square, a mobile payments start-up that allows anyone to accept credit card payments via mobile devices.

“A lot of people just don’t carry cash any more,” said Maj. George Hood, the Salvation Army’s spokesman. “We’re basically trying to make sure we’re keeping up with our donors and embrace the new technologies they’re embracing.”

The Army, with nearly $2 billion in annual revenue, was the biggest and most visible charity to adopt the technology. Other nonprofit groups and individual fund-raisers have used it too. A Girl Scout troop in Silicon Valley, for instance, used it earlier this year to sell some 400 boxes of cookies at Facebook’s headquarters after the father of one troop member who worked there realized that many of his colleagues did not carry cash, according to Advertising Age.

Lucy Bernholz, an expert on the use of technology by nonprofits, said this could have enormous potential. “It’s a no-brainer,” Ms. Bernholz said. “It’s frictionless and will make it so easy to give that if the person ringing the bell can get your attention, there’s no excuse any more because chances are you’ve got a credit card in your pocket.”

Jack Dorsey, Square’s co-founder and chief executive, who also co-founded Twitter, is confident that Square is simpler than other methods of digital fund-raising because all it requires of a donor is to swipe a card and sign.

“Instead of training people on an entirely new behavior, an entirely new way to pay, we just use what they know,” Mr. Dorsey said. “It doesn’t require them to learn anything new and it doesn’t require the merchant or organization to learn anything new.”

Though 800,000 merchants accept $2 billion in payments a year using Square devices, they are mostly small ones like farmstands, hair salons and taxi drivers, and many shoppers have not seen it in action.

The Salvation Army plans to put Square to use at 10 locations each in Dallas, San Francisco, Chicago and New York. Bell ringers will carry Android smartphones donated by Sprint Nextel that are equipped with Square’s postage-stamp-size card reader and two apps, one from Square and one from the Salvation Army. Donors swipe a card, just as they would at any credit card processing terminal, and the money goes into the Salvation Army’s account.

Square, which charges a 2.75 percent fee on every transaction, a majority of which goes to the credit card companies, uses the same security measures as financial institutions and, the company said, has an added level of safety because the payer must be present to make the payment.

Greater use of credit cards also helps the Army reduce the theft that nonprofits might experience when cash is collected in small amounts

Three years ago, the Army added traditional credit card processing terminals to the Red Kettle Campaign with mixed results — it gathered just $60,000 that way in 2009, the last year the program was used nationally. In comparison, more than $148 million in coins and bills were tossed into the Army’s red kettles in 2010.

“The credit card terminals really haven’t been a blockbuster, I’ll be candid,” Major Hood said. “The winter elements have been a negative, people have to go through a process of entering data, and it’s just generally more cumbersome than we think Square will be.”

The partnership was the brainchild of William Raduchel, an investor in tech start-ups who has worked at Sun Microsystems, AOL and Xerox and who sits on the Army’s national advisory board. “When I saw Square, I realized immediately the implications for the Army in terms of getting money,” Mr. Raduchel said.

After playing with Square a bit himself, he got in touch with Vinod Khosla, a friend whose venture capital fund is one of the company’s biggest investors, and asked for an introduction.

He has already used Square’s device to donate $1,000 to the Army, and said that despite its age, the organization was open to new technologies.

“The Army does listen to advice,” he said. “It may not agree and sometimes it takes a while to convince the top managers, but in this case, they were very fast to conclude this made sense for them.”

Mr. Dorsey said that marrying a cutting-edge technology with an institution established in 1852 was fitting. “It definitely is a throwback, but that age was an age of curiosity and innovation and particularly craftsmanship,” he said, “and as we build the product, we’re thinking about craftsmanship and details and experience.”

Article source: http://feeds.nytimes.com/click.phdo?i=449c9e2ccbe8773edb852af31d123d62

A Philanthropy Reboot in Silicon Valley

Salvation Army Bell Ringers Accepting Mobile Payments

Recent News

Partners