First, they confused charity with commerce: that is, they uncritically applied the language of outcome-oriented investment to efforts to change human behavior in social settings. Humans, alas, don’t operate neatly according to market logic, though incentives can shift behavior.

Second, donors seem reluctant to talk about their own self interest. Instead of admitting their personal desires, they speak of selfless charity. Of course, donors can do whatever they want with their money, but this attitude doesn’t help them grow.

The three donors asked for my help in crafting a strategy for alleviating urban poverty. I agreed to work with them for one year, but with conditions. Most important, they had to arrive at a “loss figure” — a sum of money that they would give away (to actual causes), but which would be entirely devoted to their own learning.

Link

From Business Week:

The qualities that make a product good for the developing world—sturdy, cheap, adaptable, modular, energy-efficient, environmentally sound, computer platform-neutral, and bandwidth-savvy—make it a good product, period. Suddenly “less is more” goes from abstract design ideal to the only viable option. This is why some of the most innovative ideas today are coming from efforts to address the needs of those most in need.

If you’re in this space, you know it’s talent that’s the bottleneck, not ideas. Link

Check out Creative Capitalism blog:
Creative Capitalism: A Conversation is a web experiment designed to produce a book — a collection of essays and commentary on capitalism, philanthropy and global development — to be edited by us and published by Simon and Schuster in the fall of 2008. The book takes as its starting point a speech Bill Gates delivered this January at the World Economic Forum in Davos. In it, he said that many of the world’s problems are too big for philanthropy–even on the scale of the Gates Foundation. And he said that the free-market capitalist system itself would have to solve them.

Charities are generally unwilling to cut prices for benefits, even when things get grim. “We don’t like to put the events on sale,” said Stephanie Astic, whose Stephanie Astic Productions organizes fund-raisers that are largely dependent on corporate giving. “But I think everybody is starting to freak out. At the end of the day, you have to throw the net out to a wider group of people.”

NY Times

NY Times writes a detailed article about Compartamos, the successful microfinance bank in Mexico:

Carlos Danel and Carlos Labarthe turned a nonprofit that lent money to Mexico’s poor into one of the country’s most profitable banks.

But not all of their colleagues in the world of microlending — so named for the tiny loans it grants — are heaping praise on the co-executives of Compartamos. Some are vilifying them as “pawnbrokers” and “money lenders.”

They are the center of a fractious debate: how far should microfinance go toward becoming big business?

Link

Muhammad Yunus on tech, profit and the poor- The Bangladeshi Nobel laureate wins yet another award - this time for contributions to technology. He talks to Fortune about where tech might take the poor.

Intel Unveils Second-Generation Intel-Powered Classmate PC – ‘Netbook’ for Worldwide Education Markets

Here’s a competitor to the OLPC program but approaching the problem with different technology:

Some people suggest perhaps the solution isn’t to put hardware into the hands of every person, but rather to maximize the number of people who have access to a PC. That’s the idea behind Paris startup Jooce (the name is a play on “juice,” as in electricity), which has devised a novel software system that lets many people use a single machine as though it were theirs alone.

Whether in an Internet café or village kiosk, a PC equipped with Jooce software gives each person who logs in a customized environment—complete with programs, preferences, bookmarks, buddy lists, and so forth. That way, even though many people may use the machine each day, it feels “personal” to each one. Jooce also lets subscribers securely store an unlimited number of documents, photos, videos, and other data—as well as gives them the ability to share those files easily with other Jooce users.

Link to Business Week

The New York Times is calling this “The Money Issue”.

Here’s some of the articles from the magazine:

About Natalie Portman and her role with FINCA. Link

What Makes People Give? Fund raisers talk about marketing gimmicks to make people give more. Link

How Many Billionaires Does It Take to Fix a School System? Five experts debate the new education philanthropy. Link

Self-Made Philanthropists. Herb and Marion Sandler are giving away their phenomenal wealth the same way they earned it — by calling the shots. Link

[On Measuring Social Impact] For Good, Measure. Foundations are increasingly using “metrics” to determine if their grants are working. But can you really measure the return-on-investment of giving to a cause? Link

Slideshow on the Faces of Social Entrepreneurship. Link

The general link to the NYT Magazine is here.

Two interesting articles from Business Week:

“On Mar. 5, investment bank Goldman Sachs announced it would change the equation by pumping $100 million into educational projects for these women over the next five years.” Link

“After weathering an acrimonious split from Intel and harsh criticism from critics, One Laptop Per Child is reorganizing—and looking for a new CEO” Link

On Thursday, the Microsoft Chairman will post a question related to “how technology can be better utilized for charitable causes” to LinkedIn’s entire 19 million members. Link

Carbon offset providers jockey for credibility. Link

“I know that capitalism works, that American entrepreneurialism works, and we can damn well expect that private capital — not government money — will actually solve this problem.” Link

The 2000 Social Capital Community Benchmark Survey shows that households with incomes below $20,000 gave a higher percentage of their earnings to charity than did any other income group. Link