Lessons for Local Philanthropy: What We’ve Learned So Far — Part II

Chapter 1: Could a Local Philanthropy Pledge Spark a New Norm?

By Catherine Crystal Foster, CEO and Co-Founder

In the spirit of transparent learning, Magnify Community is sharing the next set of our reflections on what we’ve learned from our work to date, as we reach the last phase of our three-year experiment in catalyzing greater local philanthropy in Silicon Valley.

This set of reflections — in four chapters — shares insights from our efforts to seed a new local giving norm among high-capacity givers in Silicon Valley through a three-year pledge. This chapter focuses on why we focused on norm change, and how we constructed and rolled out the Magnify Community Pledge.

Why norm change?

We made norm change a central part of our strategy because a key aspect of the challenge we set out to address was the lack of a local giving norm in Silicon Valley (defined as San Mateo and Santa Clara counties). By “local giving norm,” we mean a set of implicit rules: that people with significant capacity to give who live in Silicon Valley feel that it is accepted, valued, and expected to give to the nonprofits that make their community a better place to live and work. That simply hasn’t existed here.

To many, Silicon Valley is more a state of mind than a specific place where a full spectrum of people live their lives. It isn’t the original home for most of the people who live here, who arrive from elsewhere in the US or the world. The Silicon Valley region does not have a focal city that prompts the fierce loyalty of residents like those of New York or Chicagoland, either, despite San Jose’s substantial size. Much of the wealth here was created relatively recently by current wealth holders, rather than being passed down in a way that creates a legacy of philanthropic obligation. The corporations are global, and anything “local” tends to feel small and unstrategic to people focused on massive Total Addressable Markets around the globe. Ultimately, among the most successful in Silicon Valley, there is little sense of shared destiny with a wide range of people who happen to live in this region, and thus little sense of shared prosperity, shared responsibility, or shared efforts to enhance the region’s vitality. While there are many generous donors in Silicon Valley, there’s no universally recognized individual standard-bearer for local giving here. In the words of many people with whom we spoke, “Who is the Mark Benioff of Silicon Valley?”

Why a pledge?

To try to create a new Silicon Valley norm that “if you live here and are successful here, you give here,” we developed and piloted a local pledge targeted at very high-capacity donors in Silicon Valley that would represent a public commitment to give more locally. We hoped that taking a pledge would motivate the pledgers themselves to increase their local giving, and that their visible commitment would encourage other wealthy donors to do the same. Our original thinking was that a pledge would both change prevailing attitudes about local giving and also create a near-term mechanism for activating donations to help achieve our overall initiative goal of $100 million in increased donations to local community-serving nonprofits in five years. In a region with breathtaking wealth, less than 10% of local philanthropy was being directed to local community-serving nonprofits in Silicon Valley.

Norm change is generally a long game, and while there are times when norms seem to shift overnight — as with same-sex marriage — we held no illusions about what we could accomplish in a few short years. (We originally planned for a three- to five-year initiative, though it was later reduced to three.) We did, however, hope to set norm change in motion through a set of influential public pledgers.

While testing a pledge was our primary experiment in norm changing, it’s worth noting that we also explored other smaller norm-related experiments. These included one targeting corporations (a path we ultimately decided not to pursue), and another persuading Joint Venture Silicon Valley to include metrics related to philanthropy in their influential, annual Silicon Valley Index, a highly visible and widely used resource among journalists and policymakers. The Index, which launches each year in a major State of the Valley event, now includes that information.

Crafting the Pledge

Defining the audience: We opted to test norm change from the top, targeting primarily those who gave away at least $1 million per year, and/or were comfortable writing six-figure checks to individual nonprofit organizations. Our thinking was that there were a substantial number of people fitting that description in Silicon Valley (home to 4,000 households with more than $10 million in investable assets in 2017 and 9,000 by 2020). It is those donors who can make a significant impact quickly with their dollars, and it was their lack of attention to local community-serving organizations that prompted us to start Magnify Community. Research suggests that actions or perceived behavior by influential peers in a group — like the most wealthy — can set and shift norms. We hoped to set the standard that local giving is “what all the cool kids do.”

Setting the terms: We conducted dozens of interviews with donors, philanthropic organizations, and advisors to inform the way we set the terms of the Pledge. We knew it was neither realistic nor appropriate to presume that pledgers would forgo gifts to their alma maters, international causes, national disease prevention organizations, and the like. We, instead, adopted a “yes, and…” approach, stating that donors should give to any non-local causes and organizations close to their hearts, and to local ones.

Original version of the Pledge featuring three options: committing to giving 20% or more locally, increasing by another percentage or dollar amount, or proudly continuing at current levels of local giving

We also considered the estimated percentage of giving in Silicon Valley that was currently going to local community-based organizations (CBOs) from all locally-based philanthropy (less than 10%), and the similarly low level of local giving at that time from the Silicon Valley Community Foundation. We thus set the benchmark at 20%. We also felt it was important to create an option to simply pledge a dollar amount increase in funding to local CBOs. At the suggestion of our funders — all of whom were already giving at very high dollar levels locally, but some of whom would continue to be giving locally at less than 20% of their foundation’s total giving — we added a third option that would allow Pledgers to elect to “proudly commit to continue” to give at those levels.

We set the duration at three years, so that the Pledge had some urgency to it (unlike the Gates/Buffet Giving Pledge, which lets donors delay fulfillment until their death) but matched the time scale for family financial planning and multi-year obligations.

The end result was more complex than we had originally intended, but we tested it, and created a detailed FAQ for donors. We always scheduled conversations with potential Pledgers to explain the Pledge, as well.

Testing and refining: Over time, we shifted the framing and messaging of the Pledge language. The focus on percentage of local giving led to very useful self-examination of giving by donors, but also drove many people to opt out — doing the math felt burdensome, and encouraged people to focus less on the big picture and more on whether a gift “counted” toward the 20%. For others, being held to a percentage that they didn’t normally calculate made them uneasy. Still others said, “I already give more than 20% locally, so no need to take a pledge.”

As we had feared from the start, adding the choice of “proudly committing to continue” to give at a high dollar amount or percentage gave far too much leeway to donors to stick with the status quo and be less transparent, as well as less intentional about their self-examination of their giving.

And we also found that donors were thinking in modest numbers that were well below their capacity, based on their wealth, when setting their Pledge amounts or percentages (as translated into dollars).

We thus evolved the Pledge terms to optimize the increase in local giving.

August 2019 version (left) and January 2020 version (right) with two simplified engagement options: proudly increasing by any percentage or amount, or proudly committing to maintain current levels of local giving.

How we approached potential Pledgers and what that taught us

We started with the low-hanging fruit — our funders, and other prominent local givers. It was our hope that by beginning with a meaningful base of supporters who would be relatively easy to bring on board, we could accelerate our growth from the “faithful” to the “converts.”

We never tried to entice them with benefits that were disconnected from our ultimate objective. We invited them to sign; let them know we could provide them with tools to aid their giving; and told them we would check back on their progress annually. There would not be a suite of services or swag that would come with pledging. Instead, the rewards of pledging would be in the impact pledging would make, the pride of leadership, and the satisfaction of doing the right thing for the right reasons. We remained true to that ideal, though we did create some learning and convening opportunities that we made available only to Pledgers, to promote candor and connection.

Far and away, the biggest success factor in securing a Pledge was a prior relationship with the Magnify co-founders, both of whom have a wide network of connections among Silicon Valley donors. Yet even among these “friendlies,” it often took multiple meetings before a donor would sign. Very frequently, donors would say that they were “doing this [local giving] anyway,” so might as well sign. Somewhat less frequently, donors signed because they thought it was very important to lend their particular voices to the movement we were trying to build. Many took pains to minimize any potential influence they thought they would have over others, saying that they weren’t like Bill Gates or other “really big donors.” They signed because they trusted us and believed in our mission, and were willing to be persuaded that adding their names to this public effort mattered. Over time, the fact that trusted allies or friends had taken the Pledge, participated in our briefings, and received giving insights from us became a strong motivator, which is exactly what we had hoped to achieve.

In the next three parts of this series, we’ll look at how creating a pledge document evolved into a donor organizing effort and the creation of a highly-valued community, what we learned overall in this aspect of our work, the progress we’ve made toward norm change, and what we hope to learn in the future.

Powering local philanthropy to make Silicon Valley a better place for all of us.

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