Padraig Coffey, CEO at Zartis, is joined by Alex Wilson, Co-Founder at The Giving Block, as they discuss how technology is changing the philanthropy world.
The Guest – Alex Wilson, Co-Founder at The Giving Block
Alex has a background in management consulting, where he worked with Fortune 500 companies to develop strategies around emerging technologies like AI, IoT, blockchain and cryptocurrency. As he developed a deep interest and expertise in bitcoin and cryptocurrency, he began investing in and advising early stage cryptocurrency startups.
Software Technology and the Charity Sector
This episode explores the huge opportunity for technology to make an impact within the philanthropy sector, focusing on what is already being done, how has Covid impacted the transition and what the future holds.
Alex walks us through the innovative ways technology is changing donations, more specifically focusing on enabling cryptocurrency donations. He shares his insights on enabling transparency in the philanthropy space and some interesting ideas as to enabling innovation.
Alex, to kick off, could you tell us a little bit about what you think the importance of technology is for the nonprofit world?
Yeah, absolutely. So I think technology is just as important, or maybe even more important, for nonprofits than it is for your traditional business. Unfortunately, I think nonprofits tend to lag behind a little bit. When it comes to technology, they maybe aren’t quite as innovative. And part of that is, I think, because they’re a little more risk averse. But ultimately, we’re hoping to change that, and I think crypto is going to play a big role in that. Nonprofits from my perspective, need to think and operate more like a business than they usually do. So one of the things to do is going to be taking advantage of some of the newer technologies out there to make sure they’re keeping up with the trends. Because even though they aren’t selling a traditional product like a software product or physical products, their product is their mission, essentially and their customers are their donors. And so their donors are going to expect the nonprofit to be keeping up with the times and using technology correctly, I guess, is a short way of putting it.
So can you tell us specifically how your product (at The Giving Block) works?
So we work directly with the nonprofits – in the sense that we set them up with a software basically – that allows them to seamlessly accept cryptocurrency donations. And to them, it feels like getting any other type of donation; we have a feature that if they want, they can opt to have all of their cryptocurrency donations automatically converted to US dollars, for example, so they don’t have to worry about, you know, any volatility or manual processes, and then they can transfer over the US dollars to their bank account, and use them like they normally would. And on the donor side – there’s a pretty straightforward fundraising platform and donation widget for donors, they can choose a cause they can choose which cryptocurrency they want to donate. And once they send their donation, they’ll even get an automatic tax receipt emailed to them.
I’d like to ask you about the ways in which technology has been used for grading nonprofits, or for allowing donors to identify the kind of nonprofits that they want to give to. So what’s your sense of how technology has been useful in that context so far and is it reliable?
Overall every organization is becoming, whether they like it or not, more accountable and more transparent, just by the nature of the internet. So for example, there’s a lot of great sites out there to review nonprofits, some examples are GuideStar and Charity Navigator. And by the very nature of how nonprofits are set up there, they’re actually quite transparent, especially when it comes to financials. I mean, in the US, for example, every nonprofit files what is called a 990. And you can see line by line what their revenue was, their expenses, what people are getting paid. So it’s, I would say, surprisingly transparent. The one downside I would say to it is that – people who aren’t necessarily that familiar with the nonprofit industry, I think, sometimes emphasize or focus on the wrong areas. So one thing we’re seeing across the nonprofit industry is this idea that some donors want 100% of their donation to go to a specific program or project and don’t want to allow for any overhead costs, which is, of course, pretty unrealistic. You have to have some overhead costs, these nonprofits need to hire people, they need to pay for software, just like any other company would, then they’re naturally going to have expenses. And I think we need to get rid of the idea that nonprofits should just be taking in $1 and handing it to someone else, we should really be paying them to innovate and finding more effective ways to deliver longer term aid.
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