A conversation with Humanity United on May 15, 2012

Participants

Note: This set of notes gives an overview of the major points made by Randy Newcomb.

Omidyar Network (ON) incubated Humanity United (HU) until 2008 when HU became a separate organization to pursue its mission of building peace and advancing human freedom.

A 501(c)3 foundation has certain limits in the public policy and advocacy work that it can do. Because public policy and advocacy comprise so much of Humanity United’s work, HU created a 501(c)4 organization that both makes grants and engages in advocacy.

One advantage that philanthropists who hail from technology bring is an understanding of how to reach large audiences using technology.

There are two main areas in which HU works:

  1. Human trafficking and slavery
  2. Genocide and other humanitarian atrocities. 

Originally, HU sourced ideas for grants by speaking with hundreds of people working in these fields over a two-year period, looking for patterns and opportunities.

Randy believes that the benefits of giving “social capital” can be equal to — or perhaps greater than — the benefits of financial capital. Randy said: “Finding the right people and the right opportunity and bringing them together ... you get this kind of scaling, aggregating outcome that you don’t always get on the financial capital side.”

For example, HU convened the top 12 anti-trafficking organizations into the Alliance to End Slavery and Trafficking, in order to align the groups’ messaging about trafficking and slavery and set common public-policy goals. HU measures the success of such an initiative by looking at whether the sought-after public policies are passed and by seeking feedback from members of Congress and other NGOs on whether the Alliance is playing a role in securing the reauthorization of the Trafficking Victims Protection Act in the U.S., which is up for reauthorization every two years.

One risk with that type of assessment is “false positives,” or people giving you positive feedback regardless of your impact. “You’ll have a lifetime of false positives,” Randy said.

When asked about HU’s biggest successes, Randy gave the following example: Liberia’s second civil war ended in 2003, and Ellen Johnson Sirleaf was elected President in 2005. (This was the first time that a woman had been elected head of state in Africa.) On Bill Clinton’s suggestion, HU visited Liberia & met with Sirleaf. It then decided to start working in Liberia during Sirleaf’s first term. For instance, HU — in partnership with other funders working in Liberia — created the Philanthropy Secretariat, an organization that

  1. Supports efforts of the government and civil society
  2. Allows funders and NGOs working in Liberia to coordinate to avoid duplicating efforts.

(Randy estimated that more than $20M in private philanthropy is directed to Liberia annually; about 20 private donors and organizations are part of the Secretariat.) The Secretariat’s annual meeting is also an opportunity for Sirleaf and her cabinet ministers to present giving opportunities to the donors.

“Liberia is the argument for why philanthropists should not be afraid to take risks,” said Randy. “The possibility of return to warfare is great but the potential for peace is far greater.” Civil war in Liberia destabilized Western Africa for nearly two decades; now it’s contributing to stability. Randy does not know the extent to which philanthropy helped to stabilize Liberia, but he’s convinced HU is “contributing at a minimum to the President’s ability to govern and to further stability in the country.”

HU funds in four areas in Liberia:

  1. “Rule of Law and Governance”
  2. “Voice and Will,” which includes supporting civil society organizations and independent media
  3. “Markets and Business,” which tries to incentivize the development of marketplaces in countries that have stability
  4. “Innovative Ideas,” which is a flexible category.

HU’s work in Liberia started in 2006 in the “Rule of Law and Governance” category. At the time, Liberia lacked a cadre of qualified civil servants. HU — along with two other donors — set up a fund to underwrite compensation for 200 key government positions.

Today, HU is putting a greater focus on “Markets and Business” in Liberia. For example, it recently made a program-related investment in a manufacturing business that is a supplier to U.S. and European companies and employs hundreds of women in Liberia. (“Liberia benefits from this free trade relationship with the US so they can compete with Asian manufacturers, otherwise they wouldn’t be able to compete.” Randy said.)

When asked about shortcomings or missteps from which other donors could learn, Randy said even though HU does not accept unsolicited requests for funding, the more public it became, the more proposals it began to receive. At one point it was receiving hundreds of proposals a month. “That nearly overwhelmed our organization,” Randy said.

In particular, HU started receiving — and funding — more proposals from “bigger institutions, which were largely stable and frankly didn’t need our funding,” Randy said. These NGOs are often outside of Humanity United’s sweet spot: scrappy startups with innovative approaches. Randy’s advice is to make sure one’s staff fully understands the vision and sweet spot of the organization.

HU prefers to fund startups in part because of the values of its founders and leadership and in part because HU believes an investment in a smaller organization with the potential to scale could have a much greater impact than an investment in an already large organization where innovation is likely to be low.