I recently spent 90 minutes with several principals of Crown Philanthropic Solutions being walked through a demonstration of their Donor Advised Fund platform. To get a sense of how it works you can read around on their public site, but to get a real feel for it you need to be given a tour of the Donor site itself. The company is run by veterans from various disciplines, including venture capital, financial sales, advisor training, DAF fund deployment, technology, general business, and philanthropy. They are alert to emerging trends in online community building.
Crown has given their DAF platform a human, interactive, and engaging interface. It feels like a community site, or multiperson blog. You see faces of donors, donor family, the donor's financial advisor, and the philanthropic advisor associated with the sponsoring nonprofit. You also see timely cause-related stories, pictures, videos, and the faces of those providing the updates. You hear many voices and the buzz of converstion between family, nonprofits, and friends. The site for the donor serves as a dashboard to organize giving through the DAF for self and family, while staying in touch, via on site messaging, with the nonprofits supported by the family. The supported charities can push info at the donor, and the donor can turn that info on or off. Financial information about giving history and investment performance is also available by clicking on a link from the main page.
Crown's primary market could be deliminted by drawing three overlapping circles: donors, nonprofits, advisors. The firm seeks to bring these players into productive relationship on a common platform. Say a college or community foundation sets up the platform. The major donors to the college would have a giving fund on the platform and might give to all kinds of causes, not just the college, but the college would be there in the thick of it, giving its message and building its relationship. The donors to the college would be able to use their current money managers to manage the donor advised fund money. This turns the donor's financial advisor from gate-keeper to door opener. To the extent that donors use the "Groups" function, inviting into the site their donor networks, the site becomes a prospecting fishbowl for both the sponsoring organization and the advisor. Pricing for the platform includes a fixed set up cost, an ongoing percentage of assets in the funds (scaling down as assets increase), and a minimum ongoing maintenance charge offset by the asset based charges. The out of pocket cost for the charity is not huge. A mid-sized organization could most likely consider it.
The vision behind Crown's platform like that of the web itself is inclusive, and open architecture. It is not meant to be a world that gets walled off by a financial institution or a nonprofit. Gracious, lively, and open might be a good word for the experience. The donor can brings friends and family in. He or she can give to many causes. So why would a financial organization or a nonprofit want that kind of openness to the world at large, including competitors? Maybe because in today's world client's, donors, citizens demand it. The sponsoring organization as the facilitator is "in the mix" at all times, and is likely to garner disproportionate gains. If your organization's vision is inclusive of making the overall philanthropic ecosystem prosper, doing a service for donors, as well as prospering yourself in competition with peers, you may find a "mission match" with Crown.
In the mid-term, community foundations will have to ask, "Is this kind of DAF platform and community building platform something we adopt, or are we in competition with such online systems, and the financial organizations that may also sponsor them?" Essentially, what Crown provides is an open-architecture, virtual, virally growing, community foundation. Once again the net is changing the game. A donor group, an advisor network, a financial organization, could set up such a platform for not much money. Note too, as a community foundation, who is garnering the asset management fees. What is your take down, after advisor and Crown are paid? Are you being built up, or disintermediated? How much "load" (between Crown, Advisor, and Community Foundation) can these funds stand? Does the system reduce admin costs and save you money? How does your sustainability model look at you collaborate and/or compete in this increasingly competitive/collaborative space?