Venture philanthropy is an active approach to philanthropy, which involves giving skills as well as money. It uses the principles of venture capital, with the investee organisation receiving management support, specialist expertise and financial resources. The aim is for a social, rather than financial, return.
Most venture philanthropy organisations work closely with the charities or social enterprises they invest in for a defined period of time. Clear targets will be set, and most commonly the impact of the charity will be measured. The ultimate aim is for the charity or social enterprise to greatly increase its social impact.
Impetus Trust is the pioneer of venture philanthropy in the UK. Read about the Impetus model of venture philanthropy.
The leading European member association, the European Venture Philanthropy Association (EVPA) lists the four main characteristics of venture philanthropy as:
- A highly-engaged partnership between the charity and venture philanthropy organisation to achieve agreed outcomes
- Using a variety of financial tools (not only grants), depending on which are most appropriate to the charity's needs
- Building the capacity of the charity
- Maximising donors' social return on investment.
Picture right: Impetus social enterprise Blue Sky Development & Regeneration.
I wanted to give money to charities not because of their brand name but because of the impact they have.
Nat Sloane
Impetus co-founder and donor