Giving New Thought To Funding

Giving New Thought to Funding

With the U.S. in the throes of a national recession, demands for social services have quickly outpaced available resources. Nonprofit requests for funding have increased, and funders are struggling with selecting which organizations receive grants.

“The selection process is critical to the Venture Philanthropy Partners funding model,” says Carol Thompson Cole, president and CEO of VPP, a Washington, D.C.,-based charitable investment organization that supports nonprofits that serve indigent children and their families. Cole describes her organization’s strategic approach to decision making as part investigative, part instinctive, and wholly unbiased. She says this method maximizes her organization’s philanthropic investment in the Washington, D.C., metropolitan area.
“It’s clear that how we decide on our investment partners is as important as who we actually choose,” she adds.

Compelled to continually refine the VPP  selection process, Cole takes ideas from Malcolm Gladwell’s best-seller, Blink: The Power of Thinking Without Thinking (Back Bay Books; $15.99), to augment her team’s approach and perfect their instinctual sense. Gladwell made several procedural distinctions:

Appreciate “automatic instantaneous thinking.”

Gladwell maintains that there can be as much value in the blink of an eye as in months of rational analysis. He encourages readers to respect the possibility of knowing something without knowing how or why they know it. Cole follows her gut instincts when everything else is in question.

Sharpen skills for making snap judgments.
Gladwell asserts that the power of knowing in the first two seconds is not a magic gift to a fortunate few, but an ability that can be cultivated by everyone. He challenges readers to abandon traditional decision making, which often requires excessive information and exhaustive analysis over an extended period of time, in favor of honing innate judiciousness. Cole coaches her team to identify and focus only on the most relevant information required to make timely, effective decisions. The group quickly assesses potential partners by looking for key success traits and proven performance indicators that align with VPP’s investment criteria.

Guard against compromising biases.
Gladwell points out that while unconscious thinking is powerful, it’s also fallible. He explains that our instinctive reactions often have to compete with other interests, emotions, and sentiments. And he warns against ignoring these subtle influences–personal experience, education, and societal prejudices–that can alter or undermine unconscious reasoning. Cole ensures that the VPP selection process has a system of checks and balances to prevent any inadvertent discrimination.

This article originally appeared in the April 2010 issue of Black Enterprise magazine.