Tech Entrepreneurs Can Change the World through Philanthropy

By Joel Riciputi, posted in Benetech, The Impact on

Today we welcome Jim Fruchterman, founder and CEO of Benetech. Jim is a seasoned entrepreneur, having successfully launched multiple for-profit and social enterprises. He’s also a MacArthur Fellow, a recipient of the Skoll Award for Social Entrepreneurship, and a Distinguished Alumnus of Caltech.

As a prominent software for social good leader, we turned to Jim for his expert take on one of the biggest philanthropic questions of the day: How can successful tech entrepreneurs focus their philanthropy to help people today while also driving lasting social impact?

What is the one piece of advice you would give tech philanthropists looking to make a big impact?  

Don’t forget what you already know about how to make people’s lives better. Successful businesses invest in knowing what makes their customers happy and ensure their products and services fully deliver on that knowledge.

When it comes to philanthropy, there is a tendency to assume you know what will improve people’s lives. Do not assume! Spend time engaging with the communities you want to serve. Ask them how you can help. Develop products and solutions with the community, not for the community. If you don’t have the time to engage the end beneficiaries of your philanthropy, enlist the services of individuals and organizations who do. If you assume, it is entirely possible to waste a lot of philanthropic capital, albeit with the best of intentions.

Jim speaking with two men at a Benetech open house

Are you suggesting treating people in crisis like customers?

I’m not just suggesting it; I am saying that it is absolutely critical. The best way to drive positive social change is by treating the people you serve with the same amount of respect that great businesses treat their customers. When it comes to philanthropy, the people you serve are your partners in social change. Treat them accordingly.

Where do you believe the tech philanthropists can have the biggest impact?

I’ve spent the last 30 years serving as a bridge between the social sector and the technology community. I’ve learned something very important over those years that all philanthropically minded tech entrepreneurs should hear: better use of data and software provides the biggest bang for the philanthropic buck.

Achieving positive impact at scale continues to elude major parts of the nonprofit sector. In the United States alone there are 57 million people living in poverty, 10 million with a disability, and tens of millions more who struggle just to survive, let alone thrive. These numbers persist despite thousands of nonprofits working to serve these individuals. Borrowing from MacArthur Fellow Mauricio Lim Miller, while we have gotten better at making these situations tolerable, we have not succeeded in making them escapable.

It’s time we take a more scalable, technology-driven, and systemic approach to solving these issues. I call this software for social good, and it is time for a software for social good revolution. The nonprofit sector needs philanthropically minded tech entrepreneurs to help drive the revolution.

What’s stopping the tech community from embracing a socially-minded software and data revolution? How can that change?

The for-profit tech model is laser focused on products projected to be hugely profitable. The result is a general failure of the tech community to fill the massive needs of the social sector on issues ranging from poverty and education to human rights and the environment.

Philanthropic tech entrepreneurs can usher in a new social-good contract by merging their for-profit tech mentality with the do-good social sector mentality. They must create a network of social enterprises that are 100% focused on using software and data to fuel maximum social good, not profit.

That sounds like a big undertaking. What are the steps for making it happen?

It is a big undertaking, but it’s no bigger than what tech entrepreneurs have already accomplished in myriad other fields ranging from ecommerce to space flight. Benetech has already initiated the process of making software and data a staple of the nonprofit world. Here’s what needs to be done:

  • First, we must establish a real, two-way dialogue between the tech community and the social sector.
  • Second, nonprofits must increase social sector data literacy for running organizations more efficiently and measuring impact.
  • Third, we need to shift our philanthropic mentality away from one-off projects to a model that drives systematic change across entire fields.

Over the coming weeks, I will share specific ideas on how philanthropic tech entrepreneurs can embrace this framework. Each idea, starting with how to strengthen the social safety net, is an opportunity for tech entrepreneurs to do good by embracing what they do best: using customer-driven software and data to create massive value.

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Read about how Silicon Valley’s original tech nonprofit bridges the social sector and Silicon Valley.

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