Be creative with the toolkit: grants and investments, technology and media

We have tried to think broadly about all assets and expertise under management, using impact investments alongside grants to advance social change, and harnessing low cost technologies and media to reach new markets and communities and amplify the impact of the organizations we support.

The Social Entrepreneurs’ Fund

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Grants and investments
In recent years, foundations such as PSF have become more creative with the philanthropic ‘toolkit’ – thinking more broadly about how to use all assets and expertise under management. For PSF, this has meant using impact investments alongside grants to advance social change. To date, approximately 10% of PSF’s $400 million in commitments has been deployed in social purpose investments, allocating capital to mission-driven social enterprises that generate financial returns and significant social value. A number of these investments have been made through The Social Entrepreneurs’ Fund (TSEF), a for-profit LLC of committed investment capital focused on early stage equity stakes in impact-oriented companies.

Through TSEF, PSF has learned much about impact investing: how to do it well and how to work with others as the field evolves. Although we have also engaged in more direct investing – we invested in the New York State Social Impact Bond to reduce recidivism, led by Social Finance; in Segovia, a technology company that supports cash transfers, an approach to poverty reduction borne out by PSF grantee GiveDirectly; in Ruma, an Indonesian financial services company; and in Bridge International Academies – we have to date relied on seasoned investors like TSEF or Turner Impact Capital (its charter school development and affordable housing funds) with investment expertise and boots on the ground to source, diligence, and oversee social investments. Here, too, we are a learning organization, and our strategy continues to evolve.

Harnessing technology as a force for good
Many of these impact investments, built around the thesis that technology can be harnessed to improve lives, reminds us of the power of technology as another tool in the philanthropic tool box. While technology is not an end in itself, it can be useful to advance social change in a number of ways, improving efficiency and reducing the costs of reaching and connecting people and organizations in different ways. For example, platforms in the PSF portfolio like DonorsChoose, Watsi or Sirum match resources and needs in ways that were unimaginable a decade ago. When it comes to finance, mobile technology has ushered in massive disruptions to traditional payment and banking systems. Companies like Segovia are part of a transformation in how people pay for goods and services. Organizations like Angaza or myAgro allow for innovative financing – pay as you go – for things like solar power, seeds, and fertilizer to dramatically reduce poverty. But these are not the only benefits. By taking out middlemen and intermediaries, these direct payment and financing technologies can reduce corruption and graft. Low cost technologies can also play a significant role in behavior change. CareMessage succeeds in improving patient health outcomes and reducing larger healthcare costs by engaging low income patients through their phones in ways that help them prevent and manage chronic diseases. Measures for Justice sets its sights on changing the behavior of prosecutors and policy makers. By collecting, aggregating, and publishing criminal justice data county by county, MFJ allows people to assess relative performance in terms of public safety, fairness and equality, and fiscal responsibility. Here, data can root out injustice by bringing it to light in the numbers. This is also true of the Innocence Project, which exonerates the wrongly convicted through DNA testing. Similarly, Yahad in Unum uses forensic science and data to uncover mass graves and expose previously unknown or undercounted Holocaust atrocities. We are only beginning to explore the potential of technology to improve lives.

Media: a tool to increase reach and amplify impact
PSF has also started to examine ways in which various kinds of media – film, reporting, storytelling – offer a cost-effective tool to amplify the impact of the organizations we support and the issues they seek to address. For example, in addition to grants for Partners in Health (PIH), we also supported Bending the Arc, a film that tells the story of the genesis of PIH’s work and the power of the community health worker delivery model worldwide. To date, PSF has invested in over ten films. More recently, PSF produced a series with WNYC radio in New York that complemented, enhanced, and extended our work on the challenges of obesity, diabetes, hypertension and other related public health issues.