How to Attract Silicon Valley Philanthropy
Big tech money philanthropists are innovative and business-minded. Learn how to appeal to this mentality and attract new funding for your organization.
Silicon Valley has emerged as a major new source of philanthropic activity. As the economy flourishes, tech entrepreneurs are pouring more and more money into the social impact space. But it’s not just about the money. These new-wave funders also bring with them a fresh take on how to approach philanthropy — and how to solve complex social and environmental problems.
The resources flowing out of Silicon Valley are considerable. But for nonprofit organizations without existing connections (especially those situated far from major tech-boom cities), Silicon Valley funding can seem like a pipe dream. In part, that’s because the process is a lot less straightforward. Traditional philanthropists and long-established foundations use highly structured grant applications and review processes. Silicon Valley funders, on the other hand, are more likely to use informal vetting processes and network connections to make their funding decisions.
If you want to secure Silicon Valley funding, you can’t just go online and download an application. But that doesn’t mean this important new source of funding is out of reach. Here’s how to go about priming the pump.
Silicon Valley Funding: Why is it Different?
Silicon Valley funding has rightly developed a reputation for being different. In many ways, it has emerged as its own distinct school of philanthropic thought. A school of thought that reflects and builds upon Silicon Valley’s disruption-oriented culture.
In broad strokes, tech money philanthropists are innovative and business-minded. They believe in the power of big ideas and new technologies to displace old, tired paradigms and effect change. They have seen that this is true in their own startup-to-superstar business transformations. And they bring those same principles to the table in their role as funders.
In addition, many of these funders are attracted to philanthropy because they have learned firsthand that businesses can’t solve all of the world’s problems. Many of these entrepreneurs started their careers with a streak of idealism. They put their faith in technology to make the world better. Experience has taught them that the very businesses they’ve nurtured and grown have had unintended consequences, such as gentrification and environmental degradation. These philanthropists are interested in “closing the loop” by helping to ameliorate some of the very problems their own industry has contributed to.
What does this mean in practice? Silicon Valley funding is characterized by the following attributes:
The Startup Mentality
Tech funders often began their careers at the helms of startups. And they likely received their own funding from venture capitalists. As a result, they often bring the VC model to their work as philanthropists. They want to know what an organization’s big idea is, how they know it’ll work, what sets them apart from the competition, and what they need to succeed. And they see themselves as playing a vital role in advising and nurturing the organizations they support.
An Obsession with Disruption
Most tech philanthropists built their careers on innovation. They see themselves as agents of change and tend to be systems-oriented, design-thinking people. They have no problem with disrupting traditional methodologies and approaches. And they are most interested in supporting nonprofit organizations that promise to tackle old problems with promising new solutions. This is good news for organizations that seek to be innovative. But Silicon Valley funders have also taken heat for failing to support underserved initiatives. For these philanthropists, proven methods that get incremental results just aren’t as sexy as new technology- or market-based approaches to the same issues.
Traditional funding models involve restricted giving — or funding that must be used for certain, prescribed activities. Restricted funding also often comes with heavy reporting requirements. This “short-leash” philanthropic style stands in contrast with most Silicon Valley funders. Tech philanthropists are much more likely to give unrestricted funds with fewer reporting requirements. This “long-leash” style gives nonprofits the freedom to make their own decisions about how best to spend the money. It also enables organizations to funnel much-needed resources into their marketing and communications programs.
An Eye for Business
Tech funders may not require as much reporting, but they are extremely interested in results. They often view their philanthropic efforts through the lens of business investment. If an organization’s theory of change shows early signs of efficacy, they will want to iterate and expand on it. And if not, they’ll be just as quick to move on to the next big idea.
As a nonprofit seeking funding, this means that you should think of asking for enough "runway" to show enough impact to request more funding.
How to Attract Silicon Valley Funding
So how do you go about attracting Silicon Valley funding? Start with these tips:
- •Find a local connection. Most tech funders aren’t native to Silicon Valley. Those that get involved in philanthropy often give to national organizations or organizations in their "home" communities. So while you might be in Tennessee, you may very well find that you have a Silicon Valley connection from your area who would make a likely partner. Keep in mind, too, that Silicon Valley isn’t the only geographic location with a high concentration of tech entrepreneurs and funders. Places like Austin, Texas; Raleigh, North Carolina; and Atlanta are all fertile tech hubs that may be closer to your organization’s home.
- •Network, network, network. The best way to connect with a tech philanthropist is via a one-on-one pitch that comes from an introduction in your network. This isn’t a fast ticket. It requires that you put in the work to network. To begin, make a list of everyone in your organization's network. Next, look at their connections. Engage your entire team in outreach. Build on your team’s existing connections via conferences, associations, and the like. Over time, at least one Silicon Valley connection is likely to arise. If you find your network is filled with tech connections, narrow it down to people who care about your specific issue. Look for shared goals, values, and missions, and go from there.
- •Think like a startup. When you get a chance to make a pitch, make it count. Think like a startup and consider what matters to your potential funder. Emphasize the aspects of your work that are innovative or disruptive. Use data to show how your organization provides impact and tangible outcomes. Be sure to tell an emotionally compelling story about what you are doing and why it matters in human terms. And connect your ask to a future vision of the world. Where is the world headed and how will your work contribute to a better future? Finally, prepare a business case for the money you are requesting. How much money do you need? What will it allow you to do? How long will it last? And how will you measure the return on that investment?
- •Use your theory of change to your advantage. Your well-written theory of change demonstrates that you have a systems-oriented way of thinking about your issue and how you go about solving it. Use it to inform your pitch deck and discussions.
- •Invite your funder’s involvement. Silicon Valley funders are used to creating and running businesses. They often like to be involved at a high level in the endeavors they support. Consider crafting an ask that includes your potential funder in a project or certain day-to-day activities. Acknowledge that they have business acumen and other skills that would benefit your organization.
- •Don’t be afraid to ask for more than you think you should. Without the structure of an existing grant, you may find it challenging to arrive at an appropriate ask. As long as you have a business case to back it up, don’t limit yourself to a smaller ask simply to make your ask seem less demanding or burdensome. You should request enough unrestricted funding to truly make a difference. Just be sure to paint a big picture about what you hope to achieve — and ground it in realistic business terms. This should include funding to cover your own branding and communications programs. Tech philanthropists are more likely to understand and appreciate your desire to invest in this important impact multiplier.
There’s no silver bullet when it comes to gaining access to Silicon Valley funding. But with the right networking, connections, and storytelling, your organization may very well benefit from philanthropy’s new guard.
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