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Guaranteed Impact


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Guaranteed Impact

  1. 1. Submi&ed  by  Daniel  Blumberg,  Dave  Goodman,  and  Anna  Hurley,  Zicklin  School  of  Business,  Net  Impact  Chapter  
  2. 2. In  our  society  we  guard  against  all  sorts  of  risks—car  accidents,  illness,  floods,  job  loss—so  why  not  guard  against  the  misuse  of  our  charitable  donaGons?    By  offering  Impact  Insurance,  we  acknowledge  the  reality  that  giving  money  away  is  risky,  just  as  its  risky  to  invest  in  the  stock  market.    Stock  market  investors  demand  a  return  on  their  investment.  However,  many  charitable  donors  do  not.  Guaranteed  Impact  would  change  that  mindset.    
  3. 3. •  Decision:  Jesse  wants  to  donate  $10,000  to  fight  poverty.    He   is  choosing  between  “ Tried  &  True  OrganizaGon”  and  “Game   Changer  New  OrganizaGon.”      •  Dilemma:  Jesse  is  excited  about  Game  Changer’s  potenGal,   but  is  afraid  of  wasGng  money  on  an  unproven  organizaGon.      •  Solu-on:  Game  Changer  is  a  “Guaranteed  Impact”   organizaGon.  Jesse  is  offered  “Social  Impact  or  Your  Money   Back.”  
  4. 4. •  Jesse  pays  5%  ($500)  to  Guaranteed  Impact.  (The  percentage  is  based   on  the  charity’s  expected  impact.    Higher  premiums  will  be  paid  for   unproven  organizaGons.)  •  A^er  1  year,  Guaranteed  Impact  (or  a  respected  3rd  party)  will   determine  whether  Jesse’s  money  has  been  spent  wisely.   –  If  Jesse’s  money  IS  spent  wisely:  Guaranteed  Impact  will  donate   half  of  Jesse’s  $500  to  Game  Changer  and  keep  the  remaining  half   to  cover  administraGve  costs,  payouts  on  other  policies,  and  to   make  a  small  profit.   –  If  Jesse’s  money  is  NOT  spent  wisely:  Jesse  gets  his  $10,000  back,   courtesy  of  Guaranteed  Impact.      
  5. 5. •  Enables  more  risk-­‐taking:  Guaranteed  Impact  encourages  donors  to  give   to  innovaGve,  but  less  well  known,  organizaGons.  •  Carrot  &  S-ck:  (Carrot)  If  an  organizaGon  performs  well,  it  receives  half  of   the  insurance  premium  paid  by  the  donor.  (SGck)  If  an  organizaGon  does   not  perform  well,  its  insurance  premium  will  increase  or  the  organizaGon   could  be  removed  from  the  Guaranteed  Impact  program.  •  Guarantees  are  impressive:  The  markeGng  value  of  a  guarantee  is  very   strong.  Even  people  who  do  not  elect  to  pay  for  impact  insurance  will  be   impressed  by  the  “Social  Impact  or  Your  Money  Back”  guarantee.  •  Raise  awareness  of  impact  metrics:  Guaranteed  Impact  will  use  the  latest   social  impact  evaluaGon  metrics.  We  are  guaranteeing  social  impact.    We   are  not  necessarily  promising  low  overhead.      
  6. 6. 1.)  Partner  with  a  major  insurance  company  to  acquire  appraisal  &   actuarial  experGse  needed  to  run  Guaranteed  Impact.  Benefits  for  the  insurance  company:    •  Corporate  Social  Responsibility  –  Guaranteed  Impact  will  enhance  the   insurer’s  image  •  PotenGal  profits  –  Guaranteed  Impact  is  designed  to  be  economically   viable  •  New  customers  –  Customers  who  purchase  “Impact  Insurance”  will  be   more  likely  to  purchase  auto  or  home  insurance  from  the  same   company  2.)  Pilot  the  program  by  inviGng  50  innovaGve  social  organizaGons  (in  need   of  fundraising  help)  to  be  a  part  of  Guaranteed  Impact’s  test  phase.  
  7. 7. 3.)  Launch  MarkeGng  Campaign   •  The  campaign  will  encourage  more  risk-­‐taking  in  giving,   feature  some  of  the  innovaGve  organizaGons,  and  promise   “Social  Impact  or  Your  Money  Back”   •  Guaranteed  Impact  Seal.  The  organizaGons  will  display  the   “Social  Impact  or  Your  Money  Back”  pledge  on  their   websites.      4.)  Evaluate  and  Expand.  Once  Guaranteed  Impact  is  shown  to  be   viable,  double  the  number  of  organizaGons.  Then  double  it   again…  
  8. 8. •  Student-­‐organized  effort  will  encourage  universiGes  to  place  at   least  2  %  of  their  endowments  into  Social  Investments  •  Dual  goals  of  educaGng  future  leaders  (the  students)  as  well  as   shi^ing  dollars  from  passive  to  acGve  •  UniversiGes  are  implicit  donors  by  accepGng  lower  returns  for   socially-­‐screened  pornolios  •  The  "screening"  tool  is  archaic,  ineffecGve  and  fiscally   irresponsible.  •  >  $400  Billion  in  University  endowments  in  2008  
  9. 9. •  Social  Investor  Rewards  is  a  program  offered  through  credit  cards  •  ParGcipants  use  their  credit  cards  to  donate  to  organizaGons   they  expect  to  have  high  social  impact  •  The  lending  insGtuGon  promises  to  match  a  predetermined  sum   in  donaGons  to  the  highest  performing  social  impact   organizaGons  
  10. 10. •  The  “Why  We  Don’t  Just  Give”  campaign  features  prominent   impact  investors  telling  their  stories  of  how  accountability  and   measurement  transforms  lives  •  CelebriGes  featured  in  short  video  vigne&es  might  include:   –  Brad  Pi&:  Make  it  Right   –  Christy  Turlington:  Global  Fund   –  John  Legend:  Show  Me  Campaign  •  Vigne&es  will  be  widely  distributed  on  the  web,  radio,  and  tv   and  conclude  with:  “Learn  more  at”