About Bob Bob serves as President and CEO of GuideStar and serves on the boards of Vision TV, Grameen Foundation USA, and the AAFRC Trust for Philanthropy. More...
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Posted By Bob Ottenhoff on May 31st, 2011, in these categories: Charting Impact | GuideStar | Nonprofit Practice How much effort should an organization expend on documenting its good work for prospective donors? That was the question on the minds of participants at an interesting conference held in May by America’s Charities on the campus of Georgetown University. Under the new leadership of energetic Steve Delfin, the conference was an all day analysis of what it will take to increase workplace charitable giving. The story for affiliates of America’s Charities is that giving has continued to increase, but with a trend towards larger gifts from fewer contributors. Changing demographics and the impending retirement of baby boomers were key concerns as well.
I was there to participate in a panel with Art Taylor of BBB Wise Giving Alliance and Ken Berger from Charity Navigator. The session was billed as an opportunity to learn more about how to deal with charity evaluators and in part a challenge to their methods and conclusions. Art gave a deliberate summary of the exhaustive BBB approach to judging a charity. Ken acknowledged that the current Charity Navigator process is of limited value by focusing solely on finances, but outlined a plan to overhaul its rating system that will take several years to accomplish.
Aside from being judged, another concern on the minds of the organizations in attendance at the conference was one that applies directly to GuideStar: the time and effort that organizations spend on filling out the same information for multiple review organizations. Here GuideStar can be of particular help to over-worked charity officials. The GuideStar Exchange program is designed to be a comprehensive summary of an organization’s work: mission, programs, finances, board and management. Plus videos and other promotional materials can be added to help tell the organization’s story. And here’s where it really gets good: after posting that information on GuideStar, where it is seen by millions of people, we share your information with over 50 other sites – from community foundations, to commercial donor-advised funds, to giving portals like Network for Good, and many more all using GuideStar data. Last year, those partner sites using our data was seen by more than 5 million users and processed more than $2 billion in donations. This is an example leveraging at its best.
In today’s world, being a high-performing organization requires a commitment to transparency and accountability. Donors need regular communication on what you are doing and how you are doing in achieving your goals. It’s part of doing business. Not only do an organization’s stakeholders need to know, so do its leaders and staff in order to keep improving the organization. Will this require investments in time and people? Absolutely. Count on it. Can you do it smarter? Absolutely. Start by checking out the GuideStar Exchange: http://www2.guidestar.org/rxg/update-nonprofit-report/about-the-guidestar-exchange.aspx.
Posted By Bob Ottenhoff on March 31st, 2011, in these categories: GuideStar One of my greatest frustrations in trying to build a sustainable nonprofit organization has been the difficulty in finding capital. GuideStar has been blessed with a consortium of foundations that have generously invested tens of millions of dollars in our early years. But as we have grown and reached mid-life in our maturation, foundation dollars for operations have been harder to raise. Several years ago we took on over $2 million in PRI’s as a way to bring in stable and reliable dollars that we could invest in product development, sales and marketing in order to continue our growth at a fast pace. We’re pleased to say that we ended 2010 with 90 percent of our operations covered by sales of products and services and we’re now to a point that increasingly we are relying on foundations for special projects and opportunities, but not support for direct operations. In general we’re now starting to see some attention given to the lack of nonprofit capital and there are a number of interesting developments going on in the nonprofit sector (a subject of another blog). I’ve often thought, though, that with easier access to capital, GuideStar could have grown much faster.
I was therefore pleased to read a blog by Mark Suster an entrepreneur who joined GRP Partners in 2007 as a General Partner after selling his company to Salesforce.com. He focuses on early-stage technology.
Suster writes that entrepreneurs should “keep their capital expenditures really low while they’re experimenting with their product and determining whether there is a large market for what they do. In the initial phases of any new market you’re developing a product (hopefully with a minimal set of features), getting feedback from customers, refining your product based on user feedback and then re-launching your product. Rinse & repeat. Nobody really knows whether or not the idea is yet going to be big, so I believe in not over capitalizing too early. Markets develop for a complex set of factors that are often beyond all of our control. It is often the fortuitous mixture of new technologies, customer awareness and then acceptance of the technology and then the slow adoption into our daily lives that leads to markets exploding. Nascent startup markets are like fine wine, they take time to develop. It is encapsulated in one of my favorite quotes that I first heard from Bruce Dunlevie of Benchmark Captial, “Good judgment comes from experience, but experience comes from bad judgment.”
I take some comfort from these words of advice. I’m still impatient, still determined, still frustrated with our rate of growth. But it’s good to know GuideStar’s path of development is more common than I sometimes recognize.
Posted By Bob Ottenhoff on July 1st, 2010, in these categories: GuideStar.org  GuideStar's summer 2010 interns join Deyan Vitanov of Philanthropedia (second from left) and Bob Ottenhoff (second from right) on a bicycle tour of the nation's capital. Click the image to view it full size.
What kind of nonprofit data does a donor or decision maker need in today’s world? When GuideStar started collecting data over 10 years ago, the answer was simple: almost anything would help! Today the world of nonprofit data is a much different place. Thanks to our pioneering efforts, the IRS Form 990 is widely accessible. And thanks to the Internet, some information is available on almost every nonprofit.
Now the focus is on the quality of the data, and user expectations are increasingly moving from basic transparency to issues such as the capabilities and effectiveness of organizations. In response last year GuideStar launched the GuideStar Exchange, an effort to collect detailed and high-quality data from nonprofits. Organizations that complete key data fields are awarded the GuideStar Exchange Seal—an important badge of distinction that signifies the organization’s commitment to transparency and accountability.
This summer, GuideStar is fortunate to have a team of very talented and energetic interns to assist nonprofits with the GuideStar Exchange update process. You may be contacted by one of them in the very near future. If so, remember that they are there to help your organization attain the GuideStar Exchange Seal, which represents your organization’s commitment to transparency. Learn more about obtaining the seal for your organization
 The interns at the base of the Washington Monument; the Lincoln Memorial and Reflecting Pool are in the background
Our summer 2010 intern team includes:
Darrel Philpott, intern supervisor—2010 graduate of the College of William & Mary
Danielle Hardre—Oklahoma University
Jacqueline Miller—Bloomsburg University of Pennsylvania
Jaclyn Petruzzelli—St. Joseph’s University
Logan Theodore—Brigham Young University
Catherine Toner—Colgate
I’d like to thank Karen Rayzor for her excellent work selecting the interns, training them, and providing them with the best experience possible.
And lest you think we keep our interns locked up in a conference room all day, here are a few pictures from our recent sightseeing tour around Washington, D.C.
 The Lincoln Memorial, Reflecting Pool, Bob Ottenhoff, and Deyan Vitanov
 In front of the U.S. Capitol
Posted By Bob Ottenhoff on March 2nd, 2010, in these categories: General | GuideStar.org Last year, our GuideStar Exchange program began accepting videos as a way for you to better tell the story of your nonprofit’s work. Since then, hundreds of nonprofit organizations have begun posting videos on GuideStar. We hope eventually every nonprofit will include a video—or several—in its GuideStar Exchange report.
Some may have thought it odd for GuideStar—known for its hard facts and data—to be adding videos, but I believe videos are a powerful way to engage the public in what we do and help them to understand the meaning of our work. Plus we think that multiple data points are needed to evaluate a nonprofit organization effectively. We do not advocate judging a nonprofit solely on the basis of a video. Neither would we advocate judging a nonprofit solely on the basis of one IRS Form 990—or worse, an overhead ratio. We’ve added user reviews, too, not because we think they are the ultimate way to look at it a nonprofit, but because we think they are an important data point among many for gaining perspective on an organization’s work and impact.
Recently I read a piece by Nicholas Kristof that gave some helpful insights into what it takes to tell our stories successfully.
Kristof says, "I turned to the field of social psychology, trying to understand how I could craft my writing so that it would generate a response rather than a turned page. Over the past 20 years, there have been many studies that shed light on this question, and, increasingly, I’ve come to believe that those of us who care about human rights and global poverty can do a far better job in our messaging. Like Pepsi, humanitarian causes need savvy marketing. Indeed, they need it far more than a soft-drink company."
Kristoff offers several lessons about how to engage stakeholders. First:
[People] intervene not because of stories of desperate circumstances but when we can be cheered up with positive stories of success and transformation. For example, one experiment found that people are quite willing to pay for a water-treatment facility to save 4,500 lives in a refugee camp with 11,000 people in it, but they are much less willing to pay for the same facility to save 4,500 lives when the refugee camp is said to have 250,000 inhabitants. In effect, what matters is saving a high proportion of people, not just a large number of lives. … Unfortunately, the most cost-effective aid interventions tend to be the kind that are incremental and save only a small proportion of lives—and are thus least satisfying to the giver.
The second lesson:
Storytelling needs to focus on an individual, not a group. A classic experiment involved asking people to donate to help hungry children in West Africa. One group was asked to help a seven-year-old girl named Rokia, in the country of Mali. A second was asked to donate to help millions of hungry children. A third was asked to help Rokia but was provided with statistical information that gave them a larger context for her hunger. Not surprisingly, people donated more than twice as much to help Rokia as to help millions of children. But it turned out that even providing background information on African hunger diminished empathy, so people were much less willing to help Rokia when she represented a broader problem. Donors didn’t want to help ease a crisis personified by a child; they just wanted to help one person—and to hell with the crisis.
Kristof concludes:
It’s clear that the philanthropic community hasn’t absorbed these lessons. When we want to get help, we make logical arguments about the scale of the suffering: Five million people have died in Congo! We make people feel guilty if they don’t help, rather than good if they do. In particular, humanitarians often make poor countries sound like unremittingly tragic hellholes full of starving children with flies in their eyes. That’s counterproductive: The challenge is to acknowledge both the desperate needs and also the very real progress in parts of Africa, the prospect of improvement in real people’s lives if the help goes forward.
Any consumer-products company rolling out a brand of toilet paper will agonize over marketing. The messaging will be carefully devised, tested with focus groups, revised based on polling, tested in a particular market, tweaked, and tested again. And that’s for a product whose launch makes no difference for humanity. In contrast, if an aid group is trying to raise support for a new program that could save many lives, it will often rely on a hodgepodge of guilt and statistics that limit its effectiveness. It has been said that "statistics are human beings with the tears dried off." That’s precisely the problem—all the psychological research shows that we are moved not by statistics but by fresh, wet tears, with a bit of hope glistening below.
For a good example of what Kristof is suggesting, take a look a the book he and his wife recently released called Half the Sky. They wanted, Kristoff says:
to call attention to sex trafficking, acid attacks, maternal mortality, yet we knew a focus on such a litany of horrors would go unread. The solution we came up with was to find stories of women who had overcome adversity rather than succumbed to it. We looked for heroes, not victims. …
So far, this positive approach seems to have worked. Half the Sky became a New York Times bestseller and went through seven printings before it was three weeks old. Young people particularly seem to want to move from reading about problems to addressing them, so we started a Web site for them, halftheskymovement.org. We’re also developing an online video game and television documentary to bring new people to the cause.
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