Social Venture Partners’ Replication
Cory Sbarbaro, MPA 2002,
Evans School of Public Affairs
Paul
Brainerd, inventor of the Pagemaker software and former owner and President of
the Aldus Corporation, launched Social Venture Partners (SVP) in Seattle in
1997. The mission of SVP is “to develop
philanthropy and volunteerism to achieve positive social change in the Puget
Sound region.” Using the venture capital
approach as a model—one that Brainerd hoped would appeal to a new generation of
people—the organization is committed to giving time, money, and expertise to
create partnerships with nonprofit organizations. The organization seeks to be both an ‘engaged grant-maker’ as
well as a catalyst for individual giving.
Soon
after launch, nearly 40 individuals had signed on as Partners (contributing
members), agreeing to donate $5,000 each year and actively participate in the
activities of the organization. After
just one year, SVP Seattle had grown to more than 100 Partners, awarded
$300,000 to seven different nonprofit organizations involved with education and
children’s issues, and assembled teams of Partners to assist the grantees. Growth over the next three years was equally
impressive. In 2001 alone, SVP Seattle
granted nearly $1.5 million to 25 different organizations. Given the success of SVP Seattle and the
coverage they received in the national press, it did not take long before the
idea of replicating the model gained momentum.
The first replications launched in 1999 in Austin, Phoenix, and
Dallas. Seven additional replications
took place in 2000, and an additional five in the first two quarters of 2001.
Initially,
SVP Seattle had given little thought to the idea of replicating the model. The first replications happened organically
and without a great amount of energy exerted by the staff at SVP Seattle. It was not until April of 2000 that the
first formal gathering of SVP organizations took place, and the first steps
toward defining what it means to be an SVP organization were outlined. Throughout the remainder of 2000, despite
the economic downturn, new inquires continued at a steady pace. The volume of new requests, coupled with the
amount of time required to support the various SVP organizations, had begun to
put a strain on the staff at SVP Seattle.
It also became clear that there was a great deal of unexploited value
among the unofficial consortium of SVP organizations. With the financial support of three different foundations, and
the assistance of McKinsey and Company consultants, SVP Seattle spearheaded the
effort to determine the future course for the group of independent SVP
organizations. This case chronicles the
evolution of SVP Seattle and the other SVP organizations, and illuminates the
complexities of replication in the nonprofit sector.
Case Study Objectives
This case was initially
developed for a graduate-level core course in nonprofit management, although it
has the potential to be used on a broader level. The purpose of the case is to illuminate several of the issues
associated with nonprofit replication and establishing multiple affiliate
nonprofit organizations.
Primary
objectives include:
o
examining the role a ‘model’ organization can play in supporting
replication, and the function of the Board in determining when it is
appropriate for an organization to extend its reach in this fashion;
o
exploring the critical role of the mission and principles/values in an
organization’s development and growth;
o
stressing the challenges of taking an organization to scale in a
different community or atmosphere;
o
exposing students to the complexities associated with forming a shared
organization from a group of previously autonomous organizations;
o
pushing students to think critically about the potential impact of
various organizational models and governance structures on an organization; and
o
exposing students to the difficult funding decisions associated with
replication and shared or multiple affiliate organizations.
Secondary
objectives include:
o
exposing students to the concept of venture philanthropy; and
o
encouraging students to explore the differences between replicating
program or service delivery organizations and funding organizations.