The desire of tech titans to reshape philanthropy is nothing new. Everyone knows the transition Melinda Gates made from Microsoft to the Gate Foundation Unpleasant Critical Enterprises, a hybrid approach of investing in female-led startups and leveraging philanthropic grants to drive advocacy and social advancement. Craigslist founder Craig Newmark started Craig Newmark Philanthropies to give back and fight disinformation, protect democracy, and support women in technology, while Google co-founder Eric Schmidt The Schmidt Family Foundation to support organizations and initiatives that work towards a healthier and fairer world.
But it’s not just the tech stars making these shifts. A growing number of technology leaders are heeding the call to address some of the most pressing issues facing the world, transform systems and help communities by leveraging their industry experience with social impact.
Smart, savvy, and innovative women in particular have made this transition — from Ellen Pao, CEO of the nonprofit Record project (formerly COO of Reddit), to Ann Mei Chang, CEO of the nonprofit Bright (formerly Senior Engineering Director at Google) and Nabiha Syed, CEO of media nonprofit The layout (formerly VP and Associate General Counsel at Buzzfeed).
What inspired these powerful people to leave the technology sector and focus on social impact? Any of them could easily have left Reddit, Google, or Buzzfeed for another tech company or unicorn startup, but they chose to pivot their careers and, as Chang explained, “expand the impact and scale of solutions for the most stubborn challenges in the world. “
I spoke with Pao, Chang, and Syed to get some insight into why they moved from technology to the non-profit sector, and the impact they want to achieve on a mission.
How they got here
The tech world caters to our human need for instant gratification: you dream, you iterate, you solve complex problems, often quickly and with some of the smartest teams of people around. You build tangible products. You can start up projects quickly, even companies, and there can be great financial benefits. You can even fail and get another chance.
So why move to social sector leadership? For Chang, the change was part of a 20-year plan to do good. It was “a responsibility to make the world a better place,” Chang said. She was inspired by Elizabeth Birch who had left Apple to become president of the human rights campaign.
Pao saw how companies could use data to be more inclusive and successful. Too many companies hired consultants to tick off a DEI box by doing 45-minute unconscious bias training. “It was frustrating to see companies advocating progress by doing PR around a single training.”
For Syed, moving from Buzzfeed to The Markup was an opportunity to change journalistic storytelling. “I became interested in what it would be like to deliver news that is an integral part of democracy and accountability,” said Syed. “A nonprofit gives you the freedom to do that instead of going for an IPO.”
Each of these women tried to build frameworks for lasting change. Their technical experiences made them familiar with experimentation and risk, traits not commonly found in social impact spaces and nonprofits for many reasons.
Risk and trust in work with social impact
Risk and trust may not be common features in the nonprofit industry, but they are familiar topics to nonprofit leaders. Resources for social impact are limited and closely monitored. No one with social impact wants to be seen as wasting resources. “People don’t want to take risks because they don’t want to fail,” Chang said. “They like to take baby steps.” The thing is, baby steps and a reluctance to fail quickly means it can take decades, if not longer, to catalyze the social impact and structural change that many nonprofits strive for, hindering success.
“Funders focus on impact,” says Pao. “Startups focus on growth.” The difference between impact and growth creates vastly different cultures, incentives and metrics. Impact measurement is complicated (and often discussed), while growth is simpler and creates risk – sometimes even failure. For better or worse, the successes and failures of impact have human consequences that go beyond a product or even a person’s job.
Chang, who worked at some of the most innovative companies in the world (Apple, Google), said she could take risks by experimenting and iterating. “Silicon Valley is a pressure cooker of innovation.” This iterative model that takes Chang to social impact isn’t always easy for nonprofit leaders who have traditionally worked in the nonprofit industry.
How does the Social Impact Sector get the freedom (and the courage) to innovate?
It’s no secret that there are power imbalances between nonprofits and the foundations that fund them. And historically, it is those funders who ultimately determine what social issues and programs are championed in the rest of the world.
“We have to have confidence in the non-profit organizations we invest in. And we need to change the dynamics between funder and funder, which requires different responsibilities from both funders and nonprofits. Funders need to do their due diligence [before making an investment], trust that the nonprofits they invest in will do the right thing, and that they can do it without micromanagement. If every investor micromanaged the companies they invest in, I’m sure they wouldn’t be nearly as successful as they are today,” says Chang.
A move to a trust-based philanthropy model would create space for nonprofits to thrive authentically.
Syed spoke of proactively building trust and diversifying power as a way to address risk and create projects that take over systems. “I would like to see more spaces where different people sit at the table,” says Syed. Trust is a challenge, but essential to take innovative risks. “What does it look like to share power and decision-making? Concession requires trust, and that feels unattainable in many spaces. But we need it if we want to survive.”
The responsibility to take on system change
All three nonprofit leaders talked about how surprisingly difficult it is to raise money at a nonprofit organization, and how it is directly related to taking risks. They saw at Google, Apple, Buzzfeed and Reddit how much money is put into products with a profit motive, including products that have been developed with a positive social impact. And yet most nonprofits don’t see those same returns.
Chang noted that Candid gets 85% of its income from earned income, but for most nonprofits, funding comes from grants or individual donations, which “means jumping through hoops to keep the lights on,” Chang said .
Pao added that “you don’t control revenue like you do in the for-profit world. You are looking for donations and you don’t have much control over that.”
This feedback loop of funding can control a leader’s vision of what is possible and, over time, can foster cynicism. Syed noted that while organizations are not accountable to shareholders, there are still incentive structures in philanthropy. Syed says nonprofits are always asking, “Will our stakeholders like this? Can it be financed?” The answers to these questions often fail to get to the heart of what the communities served actually need, creating vanity projects that fall right back into that funding feedback loop.
Syed hopes organizations can reframe the responsibility to overcome these incentive structures by asking the hard questions and answering them with action. She asks, “What does power and responsibility mean? Walk the walk. Does your nonprofit have paid parental leave? These kinds of problems are everywhere and the social sector has not solved them.” Social impact leaders seek to change systems by turning organizations into opportunity models.
Social impact organizations can benefit from the experience and skills of technology leaders. Syed, Chang and Pao are familiar with complexity, solving problems under pressure and turning ideas into tangible products. The challenges are unexpected and often frustrating; however, these leaders’ deep passion for systems change motivates them to find new approaches and ways for organizations, communities, governments and funders to successfully collaborate to create meaningful shifts in an once static system.