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New philanthropy: “disruption” and the implications for education development (I)

Tue, April 16, 3:15 to 4:45pm, Hyatt Regency, Pacific Concourse (Level -1), Pacific F

Group Submission Type: Formal Panel Session

Proposal

Introduction

A new style of philanthropy is emerging from Silicon Valley with new actors, new funding mechanisms and new approaches to philanthropic giving. With technological innovation as the core influence that created much of the wealth driving the new philanthropy, it is no surprise that disruption, innovation, and impact are at the center of what Culwell and Grant (2016) have termed an emerging “giving code.”

The Contours of the New Philanthropy

These technology philanthropists share common patterns both in motive and style of giving which are reflective of theories of change that are markedly different from the more traditional styles of philanthropy. The new philanthropic approach tends to be “living” in that donors engage in philanthropy at a much younger age in order to disperse their fortunes while they are still alive. Often, multiple and somewhat unconventional channels are utilized to distribute their wealth including limited liability companies (LLCs), donor advised funds (DAFs), foundations and impact investing. In this emerging approach, some donors take a more active role with grant recipients and contribute time, talent and apply market-based strategies borrowed from their own success in industry. This methodology involves applying the mindset and language of business with a particular focus on metrics, data, efficiency and effectiveness. There is an emphasis on having an impact on the root causes of big problems, both local and global in scope. It also involves bringing new players into the education policy sector and the reworking of existing policy networks (Ball, 2017).

A critical feature of Silicon Valley’s new philanthropic model is that it identifies itself as “hacker” in nature and aspires to disrupt traditional models and generate innovation by channeling funds to societal issues or causes. Whereas traditional philanthropy tends to be contributory, guided by unmet public needs or minority interests with the aspiration to enlarge the public goods provided by the state, emerging forms of philanthropy often seek a disruptive approach to giving that aims to replace an existing service by offering an alternative (Horvath & Powell, 2016). In addition, their methods are often technology enabled and rely on “learning by doing”, “failing fast” and the “wisdom of crowds.” The permission to fail is a tenet of the Silicon Valley technology industry, which has extended from its business mentality into the new philanthropic giving code. The disruptive mentality combined with the permission to fail and the Silicon Valley venture funding culture of “big bets” and “moonshot” ideas, often results in the new philanthropists going “all in” on a certain issue under the belief that the only way to know if something works is to give it the resources it would need to succeed. While taking a disruptive approach may work well for the technology industry, such a model does not always transfer well to the public sector. Notable failures of Silicon Valley philanthropy include the Gates Foundation’s foray into the Common Core (Tompkins-Stange, 2016) and the Zuckerberg experiment to reform schools in New Jersey (Jackson, 2015).

In addition, Silicon Valley philanthropy has come under fire for failing to support the Bay Area where its fortunes have been generated and nearly one-third of residents struggle to make ends meet (Liu, 2018; Semuels, 2018). Between 2008 and 2013, the total Silicon Valley-based individual giving rose from $1.9 billion to $4.8 billion, a 150% increase. The Silicon Valley Community Foundation (SVCF) alone, a DAF with assets under management of more than $8.2 billion, has grown to be one of the world’s most well-funded foundations. In 2016 the SVCF made more than 108,000 grants valued at $1.3 billion, with only 34 percent of this amount given to the Bay Area community (Semuels, 2018). The huge resources behind Silicon Valley philanthropy mean that it has the potential to do great good and great harm to the education sector.

Objective
With the growth and evolution of philanthropy in education worldwide, the panels seek to explain the possible impact of Silicon Valley philanthropy and other similar approaches as it bypasses existing policies and practice. Consistent with long-standing international agreements, as well as growing trends to encourage private sector participation in both policy formulation and provision of education to compensate perceived contemporary inadequacies, the emphasis will be on how these radically different approaches and agreements can, and are likely to, affect public education both locally in the United States and globally.

These panels will present research that will contribute to illuminating some of the questions below.

How can we better understand the opportunities, challenges, and implications of Silicon Valley and other new philanthropies for educational development both locally and globally?

Does the nature of these new approaches change the relationship between philanthropy and the state? What are the implications for philanthropy which has an emphasis on disruption, scale, innovation and impact for public education and other services historically considered to be a public good and provided by the government?

How does the emerging new approaches contrast to traditional philanthropy? What are the implications of this philanthropy for issues of civil society?

The panels are aimed to help local and international development communities better understand the emerging philanthropic trends emanating from Silicon Valley and elsewhere, develop their strategies, as well as shed light on how their evolving engagement potentially affects local and international educational development.

Panel I will present three papers that analyze the features and influence of the emerging philanthropic giving in education, both domestically in the US and internationally. They use research and data to illuminate both the promises and challenges to education as new donors seek to broaden their impact through collaboration, networking and innovating their methods and objectives, based on evolving theories of change.

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