Questions about Obama’s Social Innovation Fund
by Kelsey Luffman

President Obama addressed a topic of interest to the nonprofit sector yesterday when he spoke about the administration’s new $50-million dollar Social Innovation Fund. In her blog Modern Giving, Betsy Fuchs, consultant, writer, and philanthropy professional, offers some explanation as to the fund’s purpose as well some hopes and concerns for its future.

 

The Social Innovation Fund is purposed to augment the resources, and thus the impact, of existing “social innovators” – nonprofits which aim to solve social crises – rather than making new government programs which attempt to remedy the same crises. In theory, the plan works by seeking out remarkable social innovators, then offering the social innovator a matching grant, the other half of which comes from the private sector.

 

Fuchs appreciates the idea of fewer government programs and trust in experienced nonprofit workers rather than Washington bureaucrats. She also praises the concept of “collaboration between social innovators, government, and the private sector.” However, Fuchs has doubts about the feasibility of the fund’s mission and presents some valid concerns:

 

-- Out of all the worthy nonprofit programs in the US, how can the “best” ones possibly be distinguished from all the rest? Will a new definition of what a “good” program looks like cause some nonprofits to change the way they operate?  

 

-- Will a $50 million budget provide enough room to make an effect? Fuchs points out that “scaling a good program nationally – even state-wide – is hugely expensive.” Even though the plan is designed to promote matching grants, will the allotted funds be sufficient to effect the improvement that has been anticipated?

 

-- Fuchs asserts that this sort of collaboration has few precedents, and that expanding a business can be difficult, whether in a nonprofit or for-profit context – how can we be sure that the limited funds will allow for setting a new standard in program scaling?

 

With those questions in mind, Fuchs concludes by opining that the plan is imperfect, but says she appreciates "what it represents." She says she will look forward to watching the plan's future unfold, as no doubt will the rest of the nonprofit sector.

 

Information taken from: Betsy Fuchs. “50 Million Dollars Worth of Social Innovation.” Modern Giving.

Back