“Everything the donating public has been taught about charitable giving is dead wrong and dysfunctional.” Dan Pallotta, Founder of AIDS Ride.
I adore and revere you, Frances Hesselbein, but a new face of leadership has emerged, one who boldly rushes in where angels fear to tread and declares that what society thinks about charitable organizations, philanthropic giving, and the nonprofit sector in general is misguided and deleterious.
Dan Pallotta is best known for creating the multi-day charitable event industry, and a new generation of citizen philanthropists with the AIDS Rides and Breast Cancer 3-Day events, which raised $582 million in nine years. He is president of Advertising For Humanity, which helps foundations and philanthropists transform the growth potential of their favorite grantees.
Mr. Pallotta argues powerfully that the nonprofit sector world is intentionally handicapped because organizations are discouraged from using such standard business tools as advertising, risk-taking, competitive salaries and profits to lure capital.
“We have a visceral reaction to the idea that anyone would make very much money helping other people. Interesting that we don’t have a visceral reaction to the notion that people will make a lot of money not helping other people. If you want to make 50 million dollars selling violent video games to kids, go for it! We’ll put you on the cover of WIRED Magazine, but if you want to make $500,000 curing kids of malaria, you’re considered a parasite yourself.”
“The nonprofit sector is critical to our dream of changing the world. Yet there is no greater injustice than the double standard that exists between the for-profit and nonprofit sectors. One gets to feast on marketing, risk-taking, capital and financial incentive, the other is sentenced to begging,” Pallotta says in discussing his book, Charity Case. This economic starvation of our nonprofits is why he believes we are not moving the needle on great social problems.
“My goal … is to fundamentally transform the way the public thinks about charity within 10 years.”
If you haven’t yet reviewed the TED talk that has the nonprofit sector buzzing, check it out here. I’d enjoy hearing your thoughts and impressions. In the meantime, I’m designing myself a T-shirt that says, “I AM OVERHEAD.”
Thank you, Dan Pallotta for having the courage and the persistence to unambiguously herald what so many of us have been yearning to say for years. Check out more of Dan’s work, including books, presentations, articles, and more at danpallotta.com.