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How MacKenzie Scott’s $12 billion in gifts to charity reflect an uncommon trust in the groups she supports

March 28, 2022 Creative Commons

MacKenzie Scott disclosed on March 23, 2022, that she had given US$3.9 billion to 465 nonprofits in the previous nine months. These no-strings-attached donations bring the total she has given away in the past two years to at least $12 billion. We asked philanthropy historian Tyrone Freeman to weigh in on Scott’s approach to donating large sums of money and her emphasis on other forms of generosity.

Is Scott’s philanthropic philosophy unique?

After her 2019 divorce from Jeff Bezos, Scott signed the Giving Pledge, a commitment that extremely affluent people make to give away at least half their wealth.

The pledge’s signatories may write a letter summing up why they are giving so much to charity and what their priorities are, which gets posted to the internet. Scott did that and amended the letter when she remarried. What makes her stand out from others who have signed the Giving Pledge is that she continues to write about her donations and what she’s learning about giving in general. As a historian of philanthropy, I study the philosophies and motivations of donors, which I call their “gospels of giving.”

Her approach is clearly unique among her peers – other billionaire donors – because of how she relates to the organizations she supports and the diversity of those causes. She says her overarching goal is “to support the needs of underrepresented people from groups of all kinds.”

Scott values the expertise of the groups she supports and their leadership. She says she doesn’t adhere to the conventional concept of philanthropy, and she questions the way many of us think about generosity. To her it is not just a numbers game. It’s more about the spirit of giving, the sacrifice in the gift.

One major difference is that very wealthy donors tend to drill down in a single focused area, such as higher education, or a few causes – perhaps the arts or medical research. There are advisers who often recommend this approach to have the most impact.

But the nonprofits she has funded cover pretty much everything charitable donors support, from education to health, from social justice to the arts. Her latest donations even include global organizations like CARE and HIAS that are serving the needs of Ukrainians whose lives have been turned upside down.

Which other gifts stand out?

Some of the largest gifts among the most recently announced are for Girls & Boys Clubs of America, Communities in Schools, Habitat for Humanity and Planned Parenthood Federation of America.

I think it’s important that she didn’t give to only their affiliates in major cities. Foundations have been underinvesting in rural America for years. Scott’s supporting dozens of local and regional affiliates in suburban and rural counties.

As I have explained before, her support for historically Black colleges and universities is important. Two recent gifts that she made, to Meharry Medical College and Charles R. Drew University of Medicine and Science, $20 million apiece, were very significant in light of how elite white donors undercut Black higher ed institutions in the early 20th century.

Does it matter when she publicly discloses information?

Scott posted an update in December 2021 without any details about her latest donations.

Instead, she praised other forms of giving by people without billions to their name. One thing she has drawn attention to is how there’s a lot of informal giving, and that it’s not valued. This puts Scott where the average person is, especially in communities of color, where people look after neighbors and family members regularly in their giving.

Since these are charitable activities you can’t deduct from your taxes, you might not think of these helping behaviors and many forms of civic engagement as philanthropy.

Unlike nearly all donors operating on a big scale, she has no offices and, so far, no website. She’s been criticized for a lack of transparency, especially after she didn’t divulge details in December. This sentiment has to do with the widespread belief that the public has a right to know when private interests spread their resources around for public benefit.

Her blog posts draw attention to trends people might miss regarding the groups she supports. She states the percentage of these organizations that are led by women, people of color or people she says have “lived experience in the regions they support and the issues they seek to address.”

When somebody shows you how they’re thinking about their giving and what they support, that could have an impact on others. It may change whether they donate only to their alma mater, for example. Colleges and museums are used to getting these big gifts, but many of the organizations Scott is giving tens of millions of dollars to say these are the largest donations they’ve ever received. She’s shattering the notion of who is a worthy recipient – the unspoken idea that only the elite institutions and the most well-known are worthy of big gifts.

How does Scott talk about giving that isn’t purely monetary?

For her it’s about generosity, not just dollars. She’s definitely thinking beyond the tax breaks she’ll get for charitable gifts.

Her December 2021 post alludes to volunteering and other activities she calls the “work of practical beneficence” practiced by millions of people, estimating that it’s worth about $1 trillion. Researchers have reached similar conclusions.

She also highlighted the estimated $68 billion in annual global remittances in that post. When people come to this country, begin working and send money to their homelands, that is a form of philanthropy. They may not use the word, but it’s the same idea, because it’s giving back to your family and your country of origin, and it responds to the same motivation as a donation to an established charity.

I agree that there’s much more to American philanthropy than the roughly half a trillion dollars donated annually. There are other kinds of giving that fly below the radar screen that are important for survival, community-building, meeting basic needs and even for democracy.

She also addresses the role and value of using your voice as an important part of social change. The history of the abolition, women’s suffrage, civil rights movements and various movements today bear this out. That is something I focus on in my research. https://www.youtube.com/embed/KS2n7VUBOa0?wmode=transparent&start=0 Historian Tyrone McKinley Freeman joined Bridgid Coulter Cheadle and Kimberly Jeffries Leonard to discuss how Black leaders are following in the footsteps of history’s trailblazers by devoting their time, talent and voice to many causes.

What do you hope the public takes away from Scott’s approach to giving?

Scott has emerged as the most notable practitioner of what’s called trust-based philanthropy. That refers to the notion that there should be fewer strings attached to donations and that reporting requirements and other expectations that often come with grants from foundations can be excessive.

In December 2020, Scott mentioned that she has a team of advisers to help her with screening, although she hasn’t shared what that process looks like. But after that, she is not asking anything else of the organizations she funds. Instead, she has chosen to step back and let them exercise responsibility, giving them space and flexibility.

I hope the public hears her answers to what I like to ask: Who counts as a philanthropist and what counts as philanthropy? I agree with Scott that it’s about more than money and that philanthropy is not only the domain of the wealthy.

Tyrone McKinley Freeman, Associate Professor of Philanthropic Studies, IUPUI

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Branding, Business, Entertainment, Tech

Small Business Dilemma: are Big Solutions Hiding in plain sight?

Video November 29, 2020 Danny Leeds

https://cdn.useriver.com/RiverTrailer_v2.mp4

Above:Content Discovery App – River video Clip Introduction

An Unlikely Holy Grail: User Sophistication and the Will to Exist Online

In late 2018 a small firm was looking into opportunities in organizing an online co-op for small businesses (CSSinc), similar to the co-ops created by farmers during the great depression. Where else to start than a trade show of more than 1000 small businesses in Las Vegas. In an informal test, they checked all the web sites listed in the show directory as an indicator of the state of web sophistication among the participants.

Story Cover feature image by Joshua Chun

Shockingly, nearly 90% were either primitive and barely functioning or not functioning at all, yielding a 404 error or “site not found”.

Naturally the 10% that were functioning, a few of which at a high level, were all the largest companies attending the show. With costs to set up, and even designing a company web site, at an all time low, why would so many pass up the opportunity to make use of this powerful tool?

‘This is Water’ and the internet dilemma that has swallowed the world

From The New Yorker:

In 2005, David Foster Wallace addressed the graduating class at Kenyon College with a speech that is now one of his most read pieces.

In it, he argues, gorgeously, against “unconsciousness, the default setting, the rat race, the constant gnawing sense of having had, and lost, some infinite thing.” He begins with a parable:

There are these two young fish swimming along, and they happen to meet an older fish swimming the other way, who nods at them and says, “Morning, boys. How’s the water?” And the two young fish swim on for a bit, and then eventually one of them looks over at the other and goes, “What the hell is water?”

This oft quoted passage is about how the world around us can be easily misunderstood by lack of awareness. And, maybe, by the lack of any perceived need to notice what’s really going on.

The two most shocking things about the anecdote above, regarding 90% of small businesses lack of internet presence (or sophistication), are how this could be the case after more than 20 years of the internet being at the center of commerce and, well, life, and what it says about the “water” we are all swimming in.

2020 is the year that the internet became even more important for all our lives. Less obvious is that it is also the year that the problems and obstacles are more important than ever to overcome, and that starts with seeing the water we are all swimming in.

‘The Social Dilemma’ is also a Small Business Dilemma

In this acclaimed documentary (available on Netflix) a lot of both problems and solutions focus on the dangers of the current giant-tech dominated internet environment on the “end-user” and the general public.

While that sphere of influence is a serious and growing problem, it is the control and domination by a few massive companies, to the virtual exclusion of smaller businesses, that, to a large degree caused the sick, twisted inequitable and unfair system in the first place.

The relative size imbalance is literally so massive that it is rendered incomprehensible, and, like water to the fish mentioned above, invisible.

A happy shiny logo of, say, coca-cola, looks just as harmless (or menacing, depending on the perspective) as that of Amazon or Facebook, who may be hundreds of times larger in market-cap than the soft-drink giant with long history as a “big” American company. Size of this magnitude is impossible to conceive of by most of us.

But the perception of the giants that control the internet as harmless, or even beneficial and to be admired, is rapidly changing. Therein also lies the potential for probably the only hope of positive change for small business and for society in the US and across the globe.

A Revolution of Perception is Required and already Underway

Part of the problem, one that is growing, admittedly, every day, is the sheer scale of the inequity and corruption. Why even try, as a small business, to go up against the giants that “own” the water we swim in?

Ultimately what is necessary is a sea-change (forgive the continued metaphor) within overall population, both consumers and small businesses. And that starts with the perception that it is the “people” that decide how and what the internet will be who will be “permitted” to interact. An Algorithm own as proprietary secret software by an internet behemoth? Or a decentralized more kaleidoscopic solution that was an inherent promise from the initial days of the internet’s creation?

The signs of change are all around. The “direct to consumer” trend that has produced massive success stories also paved the way for the emerging system of smaller companies being able to reach out directly and actually do business with customers with, sometimes, minimal involvement of the giants.

The signs that this can work are gradually being seen – shopify’s success in offering software and services to businesses wanting to establish a direct connection to buyers is a growing trend. There are many other companies that have recognized the trend and are trying to ride this wave toward a different method of communication between businesses and so-called consumers.

Here are some examples of companies that are taking a new approach to the way we communicate and interact online:

Content discovery app River
blogging platform Ghost
Substack
Squarespace
Medium.com

However, the ultimate driver of positive change in the internet will be the increased sophistication of users, both professional and at the individual level.

User Sophistication and Trust: an unlikely but all-important Grail

Facebook, Instagram, Pinterest, Twitter, TikTok and more have all embraced direct in-app-shopping as a way to expand beyond content. Even Google has started a program to allow buyers to purchase from search results without leaving the platform. While these initiatives are all coming from the giant tech firms themselves, they are, ultimately, sowing the seeds of their own demise.

They are, in essence, teaching buyers to forego the now standard system of choosing between Amazon and “the rest” in online shopping. This choice, helped along by billions in losses to subsidize “impossibly low” prices plus free shipping paid for by Amazon’s loss-leader strategies, was never a fair or realistic one and created the massive, unsustainable imbalances in online commerce we see today.

The massive and very real paranoia of the giant companies is based on the clear and deep understanding that the competition is always “1-click-away”, which is the unfulfilled promise of the internet in the first place.
D.L.

The greatest obstacle has never been the massive price-dumping schemes or even the sell-at-a-loss free shipping concept that kept buyers from having a second choice in e-commerce. It has been the lack of user sophistication of the sellers and the buyers in the online forum which prevented easier movement from one online option to another.

The massive and very real paranoia of the giant companies is based on the clear and deep understanding that the competition is always “1 click away”, which is the unfulfilled promise of the internet in the first place.

So called “moats” and systems to block users from initiating and exercising choice are built-up and keep getting deeper and more complex. But sophisticated users can, and eventually will, easily just opt-out at any time, when alternatives that they prefer begin to proliferate.

And there is a growing and invisible ocean that already exists all around us. As far-fetched as it may seem “the ocean we swim in” will one day be in no way similar to the deeply problematic one we swim in today and a thorough a change from the bottom up as well as the top down will, finally, bring about a new era in online communication and commerce.

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