“Doing Good Well” has never been more difficult. The newly minted venture philanthropist or social entrepreneur entering the realm of “doing good” may encounter social investing jargon or complex impact assessment frameworks. Even for seasoned venture philanthropists, learning from peers and continuing to increase effectiveness can be a challenge.
To help new entrants and seasoned practitioners make sense of available best practices and frameworks and overall increase their ability to create social impact in partnership with their investees, AVPN has developed the Capability Development Model (CDM).
The CDM captures five venture philanthropy (VP) practice areas. Under each area AVPN curates content (cases, publications, webinars, articles, news, etc.) to help members chose practices to improve their efficiency and effectiveness in creating social impact and solving social issues. If you want to get involved, here are a list of ways you can do so and you can reach us on email@example.com
|Pre-engagement: This is the first step on the journey of venture philanthropy. It includes three activities: sourcing, screening (including due diligence) and structuring social investment deals. In the sourcing phase, social investors build the pipeline by raising awareness of their mission and investment criteria. Screening candidate organisations, also known as due diligence, can be a lengthy and expensive process. Finally, the process of structuring the engagement for the mutual benefit of VPO and SPO includes negotiations around investment terms, capacity building and impact assessment.|
|Capacity Building: At the heart of venture philanthropy is an engaged approach with the funded organisation. Ideally what is provided by the social investor or resource provider matches what is needed by the SPO. The SPOs’ needs tend to come from internal parameters, e.g. the development stage of the organisation, the management team, its social mission, operating model and growth plans. VPOs have different in-house capabilities to support capacity building and hence may need to structure the delivery of capacity building with third-party providers either paid, low- or pro-bono. In 2015, we wrote a set of 10 case studies of best practices in capacity building, screened leading literature, ran several workshops and in 2016 published a report on best practices in capacity building.|
|Impact Assessment: Measuring the outputs and outcomes of a social mission are crucial to understand how and if social missions are being achieved. While there is an abundance of tools and frameworks, the conversation between funders and SPO is the crucial foundation for creating impact. In this conversation, parameters such as the nature of the social cause and how it can be measured, the criteria that could be selected, whether the assessment should be customized or standardized and finally what is the purpose of the impact assessment and what actions follow different results are being discussed. Most importantly, VPOs and SPOs examine what works and move towards this. In 2015-2016, we published an initial set of 3 case studies, surveyed the extensive literature, compiled common questions and finally wrote a guide to help doing IA well and to answer these questions.|
|Portfolio management: Most VPOs fund more than one SPO and all of the SPOs they fund make up the VPO’s portfolio. Crucially, managing a portfolio requires clarity on which SPOs to add and which to exit and how to add value to the portfolio SPOs during their investment period. As such, portfolio management includes pre-engagement, capacity building, impact assessment and multi-sector collaboration. There are different strategies such as geographic or sector focused approaches. In 2015, we published 4 case studies in this area. For 2016, this is one of the areas we will expand with case studies and a guide on portfolio management.|
|Multi-sector collaboration: Collaboration moves a single social solution up to systematic change. This practice area examines the different collaboration constellations between the social sector and business and government. Critical practices in this area are to be able to identify stakeholders, spot synergies between sectors and then align social missions while involving stakeholders along their strengths. Doing these areas well can lead to improving the outcome for everyone. Some examples of multi-sector collaboration are collective impact and social impact bonds, where stakeholders from all parts of the social investment ecosystem come together to solve a social issue.|