Omidyar Network co-founder Pierre Omidyar. Credit: Flickr user OnInnovation
In a post making its way around the civic innovation world today, the Omidyar Network’s Matt Bannick and Stacy Donohue explain why their philanthropic organization, founded in 2004 by eBay’s Pierre Omidyar and his wife Pam, has focused its recent work on for-profit, as contrasted to non-profit, ventures. "[W]e believe," they write, "believe those models offer greater sustainability, more efficient IT spending, and a better platform for scaling."
Here’s more:
Philanthropy is critical to fostering civic innovation and government transparency. But it is also limited by a relatively fixed pool of foundations and high-net-worth individuals committed to the cause. In other fields where Omidyar Network is active, such as microfinance, nonprofits played a critical role during the field’s early development. However, for-profit players with sustainable and scalable business models (for example, commercial financial institutions), were critical to transforming microfinance into a flourishing global sector. We believe civic innovation has similar potential.
"I can’t keep going after grant after grant after grant," is something that you’ll hear people working in civic innovation — whether it’s citizen service apps, or open government, or government coding — say with some regularity. Seed funding provided by organizations like Omidyar helped sustain the early .org years (MoveOn.org, Change.org, CodeForAmerica.org) of civic innovation, enough to convince some in the field that there’s real money to be made. That has Bannick and Donohue believing that the time is now to invest in profit-seeking ventures. Here’s the rest.