Saving Charity (5/6): Venture Philanthropy
In a departure from the models used by many charities and non-profit organizations today, there is a small but robust subset who work in what’s known as ‘Venture Philanthropy’.
First described by John D. Rockefeller III, Venture Philanthropy is a type of impact investment that takes techniques and concepts from the venture capital and business management worlds, and applies them to philanthropic pursuits.
Venture philanthropy often takes the form of a non-profit foundation which is designed to increase its wealth basis through the development of profitable programs. Income from these programs is fed back into the business model to grow the impact achievable without relying solely on donations.
This type of philanthropy is being used by some of the biggest foundations in the world to create success stories that can start with a small local program, but which go on to deliver a template for global scale with outcomes that deliver more than just food staples and clothing, but create new opportunities and build new economies.
With Bitcoin, an unprecedented layer of visibility and speed can be applied to an entire fund’s structure, creating trust and building momentum.
Imagine a charity built on a business that creates unique events which it records on the ledger, wrapping them wholly in transactions and making maximum use of Bitcoin’s features as a timechain. As money comes in, all donations from a given user can be made via a private channel and stored on the public ledger. The fund might need to verify that a donor is of a certain age or from a certain country but this would be the limit of their visibility.
On the user side however, the transaction record can be used to generate simple tax documentation and details of their exact contributions to the global effort. Every donor can know exactly what they gave, when they gave it and would be able to follow their donations to see how they are used.
The money stream must still be split between charitable donations and running costs of a business entity. With the traceability of Bitcoin, it becomes simple to implement a scheme where artists or product makers can take their pay as a percentage of the money donated. Innovative smart contract structures can be created which give them more money for a more successful event or product.
In a simple example of streaming views or product sales, there could be a minimum fee (paid per second on a price per item basis) which would represent the cost to supply the item. This is adequate money to support the entire supply and retail chain to the point of purchase, and it gives everyone who touches it a micropayment for their part in the effort. This in itself can become part of the charity model, providing opportunities for everyone working in that supply chain. People buying services and products would then be able to donate more money on top of the good or service. A minimum donation amount can be incorporated into the floor price very easily.
To give an idea of revenue opportunities for this type of event, If the live broadcast can be viewed for $0.1/hour and users watch an aggregate 1 million hours, that is $10,000,000 for the production cost plus any added donations flowing into the project event from the livestream.
In all of this a second opportunity exists to deliver social media showcasing the projects as they progress during the giving cycle. Imagine a live event where a secondary stream shows the trucks of food and goods being delivered to the needy and paid for in real time. This isn’t possible unless the funds being donated have the velocity of Bitcoin. Smart contracts manage all outgoing payments ensuring that all commerce within a fund can be managed properly, fairly and honestly in an environment free of graft and embezzlement.
The BitcoinSV ledger and network is the only network in the world that is being designed to handle such endeavours in a proper, legal and cost-effective way driven by economic incentives.
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About Brendan Lee, Head of Technology
Mr. Lee's career to date has been focused on increasingly senior roles within industrial design, automation, and control, focusing on software design and implementation. Most recently, Mr. Lee was the Bitcoin Engineer Lead for Tokenized Group Pty Ltd, a company responsible for the Bitcoin Tokenized protocol, which is a comprehensive, regulation-friendly solution for businesses to create tokens for real-world assets on the BSV blockchain.
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