Q: What is EVPA?
Q: What is the EVPA definition of venture philanthropy?
Q: How is VP positioned in relation to other forms of philanthropy?
Q: How does Social investment relate to VP?
Q: Who are the possible key stakeholders in VP?
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A: EVPA is a membership association made up of organisations interested in or practicing venture philanthropy across Europe. Established in 2004, the association is a unique network of venture philanthropy organisations and others committed to promoting high-engagement philanthropy in Europe. EVPA’s diverse membership includes venture philanthropy organizations, grant-making foundations, private equity firms and professional service firms, banks, philanthropy advisors and business schools. Today the association counts over 130 members from 20 countries.
EVPA has two main aims: to support its members in carrying out their venture philanthropy activities, and to promote venture philanthropy throughout Europe.
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A: Venture philanthropy works to build stronger social purpose organisations by providing them with both financial and non-financial support in order to increase their societal impact. EVPA purposely uses the world societal because the impact may be social, environmental or artistic. As venture philanthropy spreads globally, specific practices may be adapted to local conditions, yet it maintains a set of widely accepted key characteristics:
- High engagement – Hands-on relationships between the social enterprise or non-profit management and the venture philanthropists
- Organizational capacity-building – Building the operational capacity of the portfolio organizations, by funding core operating costs rather than individual projects
- Tailored financing – Using a range of financing mechanisms tailored to the needs of the organization supported
- Non-financial support – Providing value-added services such as strategic planning to strengthen management
- Involvement of networks – Providing access to networks enables various and often complementing skill-sets and resources being made available to the investees
- Multi-year support – Supporting a limited number of organizations for 3-5 years, then exiting when organizations supported are financially or operationally sustainable
- Performance measurement – Placing emphasis on good business planning, measurable outcomes, achievement of milestones and financial accountability and transparency
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A: Venture philanthropy is one tool in the social investment toolkit, along with other forms of philanthropy. It is often used to help social purpose organisations make a strategic shift, expand into a new market, or replicate their model. Other methodologies are equally important and sometimes better suited to certain types of projects, such as early stage financing risky projects or advocacy and campaign funding. However, beyond being a mere “tool”, venture philanthropy is emerging as a new industry, with an entire support system around it, including advisory service firms and business school programs specialised in venture philanthropy. For this reason, the industry-building role of EVPA becomes increasingly important, thus also calling for the development of best practice training and guidelines.
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A: Venture philanthropy is a methodology, which is used for both grant-giving and social investment. The types of organisations and funding exist on a spectrum from impact only to impact first. Social investment (or social venturing) refers to funding that may generate a financial return, but where the social impact comes first; so-called Impact First strategies. Grant funding on the other hand is the provision of non-repayable donations to the social purpose organization supported; an Impact-Only strategy.
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A: Venture philanthropy methodology considers three main stakeholders. Donors or investors, which include foundations, VC/PE firms, high net worth individuals and corporation. They expect mainly a social return from their “investment”. VP organizations which provide tailored financing and non-financial support to the target organization and expect a social return on their investment. Any financial return will be recycled into new investments. Finally the investees, which are usually non-profit organization and social enterprises at a critical stage in their development.
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