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The Way We Think About Charity Is Dead Wrong

Why Give a Damn:

Everything the donating public has been taught about giving is dysfunctional, says AIDS Ride founder, Dan Pallotta. He aims to transform the way society thinks about charity and giving and change.


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There are two rulebooks. One for the non-profit sector and one for the rest of the world.  Tweet This Quote

Activist and fundraiser, Dan Pallotta, calls out the double standard that drives societys’ broken relationship with charities. Too many nonprofits, he says, are rewarded for how little they spend — not for what they get done. Instead of equating frugality with morality, he asks us to start rewarding charities for their big goals and big accomplishments (even if that comes with big expenses). In this bold talk, he says: “Let’s change the way we think about changing the world.

“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,” Dan Pallotta says in discussing his latest 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.”

Bio:

When you prohibit failure, you kill innovation.  Tweet This Quote

Pallotta is best known for creating the multi-day charitable event industry, and a new generation of 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. He is also the founder and President of the Charity Defense Council.

Do not confuse morality with frugality.  Tweet This Quote

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  • Zach Perkins

    I agree with your post. Sometimes non-profits don’t get the recognition that they deserve. Additionally the wrong charity organizations are being placed unnecessarily on a pedestal. My question to you is, isn’t part of the goal of non-profits to help change the world, with or without recognition?

  • Brittney Glende

    When reading through the article and then reading your comment on it, your question really stood out to me Zach, I feel that even though some of these non-profits are not getting the recognition that they deserve, they should be doing it for the love of it and not necessarily to be recognized. I can think of many non-profits who are working to better other peoples lives. Now that is changing the world. Even with out recognition they are still making a difference :)

  • Connor Driscoll

    I agree with your perspective Brittney. One can only hope that non-profits are satisfied with making a difference with or without the recognition. If the recognition comes, great. If not, life goes on.

  • turbo_frey

    I also agree with what you have said Brittney. I too believe that charity means giving to others out of love in order to help increase their quality of life. Charity should never be for recognition but instead, to help others live a happy life. Like Connor said, if the recognition comes, great, but if it doesn’t, remember that one gave to another for mere happiness and out of respect. Nothing can bring more happiness than that.

  • Taylor Schulz

    “Dont confuse morality with frugality” I love this quote from this ted talk. The bigger picture is what should really be the goal for non-profits. Like you said, without looking at the big picture, non-profits are diminishing much of the profit they could have created. I like this idea of changing the way we think about charity and I think if this message spread and got through to many of the non profits out there it could be a great thing; more profit and more success!

  • Brianna McTee

    I think this is a great post with a lot of truths. There
    seems to be some sort of stigma about nonprofits asking for money, when in all
    reality, money makes the world go ‘round. While that seems harsh, there is
    truth to it.

    We must be able to separate the idea of nonprofit and the
    idea of money. One must have money in order to serve charities. Thus,
    nonprofits should be understood as entities that receive money for charitable
    giving as opposed to receiving money to place in their pockets.

  • LevenhagAL14

    It really hit me when he commented on how much it would help the company when money donated is sent to advertising. I prefer to donate my time instead of money because I worry about the money being spent in the wrong way. Him talking about expanding the target market really made me realize that advertising and marketing is really important. Interesting discussion. My question is, for other readers, do you personally believe that your money or time is more valuable when donating to charities?

  • weidmankl15

    I completely agree! When it comes to people looking for donations, I always try to donate time over money because I know that my time will be spent well. If I donate money, I have no idea where that money is really going.

  • AmandaBrom

    I find it so sad that we have been stuck at 2% for so long. It makes me wonder how anything is going to change if do want to make that change. often times I hear people say that it should be the large companies that donate all this money and how come they aren’t doing more. After hearing this talk I believe the reason why is because big companies do what is popular and what is trending. If as a country we have been stuck at 2% it shows that people don’t want to donate and they want someone else to fix it. I wish that some time people would open up their eyes and start spending more time and be more willing to help fix the problems we have.

  • GraceFelion

    I know I’ve watched this TED talk before and as I watch it again I feel even more passionate about the message. There is such a stigma setting nonprofits back and I truly hope that it someday can change. I hope to see a world where passionate, smart people can run nonprofits without concern for lack of funding. For a long time I harshly judged charities that spent a lot of money on advertising or paying the executives. Now I understand the need and I respect that it is necessary for nonprofits to spend that money in order to make any impact. You have to spend money to make money. I hope this message is heard by many and that someday things can change. Thank you for this post!

  • Katie Ackerman

    It’s all about the buzz marketing. If people are constantly hearing about that non profit, that’s what they spread the word about. People forget that every cause is worth consideration. Regardless, every non profit should be attempting to make a difference with or without recognition.

  • Caitlin Snyder

    I completely agree! The more they pound into your brain, the more you want to talk about it and spread it around. I think people are too lazy to research past the organization that’s being marketed, honestly.

  • Caitlin Snyder

    I totally agree with you and I’m sure if people opened their eyes, we would be at much more than 2%. 2% is an awful number, and after hearing that I want to make a change and spread the word. I know I’m only a college student but somebody’s gotta do it. Otherwise people will only listen to what’s being marketed at the current time.

  • Angela Hoch

    Katie, I completely agree with you about people forgetting that every cause is worth consideration. I feel like sometimes we overwhelm ourselves with the little things in life that bother us, and tend to forget the big, overall picture. There are so many other problems out there and a lot of us are fortunate not to have to rely on others’ help. Every non profit should want to help out regardless of what the outcome is. All that matters is that you try, you’re trying to make a true difference in the world.

  • Katie Ackerman

    Absolutely. I bet if you asked a classroom full of students the top 5 non profits they have heard of, they would be relatively the same.

  • Katie Ackerman

    Exactly, and I think that is the majorities goal. There are always those few that I am sure are not spending the money raised they way we think they are going to. That’s life though, always a few bad eggs.

  • sappt

    That’s a very interesting idea Brianna. When people hear or see nonprofit companies wanting/needing money, they assume that its just for their pockets but that’s not true. They need it to change the world, so we really have to separate nonprofits and money. If they don’t have any funding than its just a group with a good idea of how to help people.

  • Josh Pritchard

    Katie I agree with you. Even if someone isn’t getting the recognition they deserve, it will come! There will be a time when they have all the attention. The important thing is that they focus on making a difference. Helping others! That should be enough for themselves. I would feel great about myself, I don’t need the recognition.

  • Alyssa Borgrud

    Angela, I agree with your point that as long as your try, you are making a difference. Not everyone can make huge noticeable differences in their life, but as long as they are making a little difference, it is not going unnoticed. When a bunch of people make little changes, it can result in one big noticeable change which can get others to jump on the bandwagon and try to make a difference too.

  • Keeli Gilbert

    Katie,
    I so agree with you. People forget that even if they are a non-profit, they still are doing good in the world. As our media portrays most things, non-profit is known to be a negative thought. Helpings others is good not only to make us a whole/community or whatever, look good, but to also make us feel good and that we are doing something to help others in anyway. People need to understand that it isn’t about the recognition, but about how we made the others feel.

  • Keeli Gilbert

    Angela I agree with you, that people need to try. It is getting them to do so that is the problem. Since everything that is on the internet and said through the media is “true” these days, we need to get them to believe and get them to want to try to make a difference in the world. What is one way that you find yourself making a difference in the world?

  • Katie Ackerman

    I love that, “how we made others feel.” That is so true.

  • Cory Zaeske

    I also agree. I think that there isn’t a better feeling in the world then knowing you did something in the world to make a difference. Whether the recognition is there or not, you should feel good about yourself knowing that you made a difference. I really likes the Stanford MDA comparison he made because it shows that although he isn’t the CEO of a s charity he is making his money and contributing in ways that are unimaginable.

  • emilyursino

    I am not very familiar with metrics for grading non-profit performance, but this article showed me that it really does need to change. I understand that those who donate want their money to go to good use, but that does not necessarily mean the recipients need to be frugal with it. Frugal does not always mean effective spending.

  • laurenkraft

    I am the same way Kenzie, although I will donate money to charities or for a good cause based on my gut instinct and my hopeful trust that the donations are going to where they say they are.. But volunteering is by far more a better feeling in my book. Knowing that I am taking time put of my day to help others is a great feeling!

  • Karissa Ponischil

    Skimming through these comments, I am seeing a lot of the same thing. Everyone agrees that this TED talk has validity and everyone realizes that there needs to be a change. This is all great, but I want to know what it is people can do because in reality, agreeing isn’t enough.

    What can we do that will lower this stigma? I myself am not sure of what is an appropriate amount for the CEO of a non-profit to make, but anything above subsistence will probably raise eyebrows among people making a great deal more choosing to work for profit specifically.

    We need to figure out what works best, what will lead to growth, and what will lower stigma. This TED talk was a good start, but in order to reach that 3%, people need a call to action. We just need to work together to figure out what that could be.

  • Angela Hoch

    Katie & Keeli, I also agree that people who work for a non-profit often forget that they are making a change in our world. It makes one feel good inside, as well as show others that there is always room for change.

  • Angela Hoch

    Exactly :) I think a lot of people tend to be the followers and when a leader is seen doing good, others tend to want to follow when they see the positive effects that are taking place.

  • Angela Hoch

    Thank you Keeli, I feel that recycling is something small but something that I really work on doing on a daily basis. It’s crazy how many people forget about taking that one second to separate their garbage with recyclables!!!! Little changes can add up to bigger ones. What is one thing that you find yourself doing?

  • Jared

    This is an excellent article that highlights a huge issue with the non-profit industry. My family runs a NP and we are constantly concerned about public opinion of our expenses. However, without spending money on fundraisers and events, there is no way we could help the children we want to help. People need to realize that an NP doing bigger things can get more done for their cause, even if that means generating some expenses along the way.

  • Marissa Forbes

    I’ve never heard non-profits discussed in this way, and I think spreading this view of things would help things change a bit. There’s a certain image non-profits have in society that causes them to be viewed so differently from other businesses. One interesting way I have seen a non-profit organize their finances is Charity: Water’s 100% model. When someone makes a donation, there’s a promise that every dollar will go directly to water projects, and there are private donations made by foundations and other sponsors that go towards covering administrative costs. I think this highlights the distrust people have towards non-profits, that a charity would have to go to such lengths to assure the public that donations are being used in a precise way.

    I think that a large issue that causes non-profits to not have the same resources as other businesses is the expectation of people donating that every single penny goes towards the cause. In reality, this isn’t realistic because it doesn’t allow the non-profit to use donated money to reach larger goals through more traditional business practices. If a non-profit does use donations in this way, they get slapped with a bad reputation from the public.

  • LevenhagAL14

    I agree, it feels better to donate time than it does to donate money. It’s more satisfying because you can recognize the amount of time you’re donating while money can be thrown away almost mindlessly.

  • TeamGarvin

    I totally agree. I have never looked at it this way, but the way you put it is so very true. It’s to often in today’s society that people look at what you put into it not what you get out of it. If you compare this to the movies, you have those movies that spend little money and no one watches, they then get nothing out of it. Then you have those great movies with a lot of money put into is and the do great their production is great and so is their outcome. I believe that is how things work and should be notarized. It’s like the casino mentality spend big to win big. If we had that for charities who knows what they could accomplish in the future.

  • lepkowskjj29

    I totally agree and like the examples of the casino mentality spend big to win big.

  • lepkowskjj29

    totally agree. the mentality needs to change on both ends.

  • Jack Delabar

    I totally agree, Karissa. Posting a comment on a website saying that you agree isn’t enough. That isn’t going to change the things that need to be changed. We need to actually DO something! I think that people are scared to stand out and make a difference, so they just blend in with everyone else and “agree”.

  • Amy Rink

    I am the same way, now that I have watched this video I now understand what the nonprofits need to do in order to make an impact. Like you said, this message needs to be heard and things to change!

  • TeamGarvin

    That has always been my mentality when I go in. Unfortunately I always walk away empty handed.

  • schrammjm26

    This is all so true! There is always massive confusion about what charitable organizations are actually charitable and which ones are just fronts. Some people donate to charity’s for the tax deduction, others so they can just feel good about themselves. They may know what their money is going toward but they don’t pay attention to the percentage of their money that is being donated and what percent is being kept. This may vary a bit from the original topic but if I donate my money to someone I would much rather do it directly to the person(s) receiving the money, not through an organization.

  • laurenkraft

    Exactly! It’s sad because we throw away money on the reg! Time over money.

  • Brandon

    Thanks for this video!! Sometimes we need know where the money goes when we donate for charity. These charity are so big that sometimes that they do not know what with money they show us where the money goes. Wealthy people could donate every so often to show that they just care about themselves and show they want these charities to succeed.

  • lex_alwaysMIA

    I agree, and for some of the very wealthy individuals of the world it makes me wonder. Are they really donating to charity because they want to or are they doing for a tax write off? Besides knowing where it is going we should know other factors as well. Charity is a touchy subject because you expect people to do the write thing. Sometimes it does not always happen as such.

  • clemonsel02

    I think this video is eye opening. It makes you wonder just how we are really doing charity and where the money we think is going to something is really going. I think that people need to be forthcoming with what they money is truely going to. I personally would be more likely to give more if I knew exactly where my money is going and seeing the impact of that money. Do you think other people would do this too?

  • Riley Amos

    Very insightful Marissa! I too think the general public doesn’t consider the operating costs of non-profits and because of this, non-profits can find themselves in a sticky situation. I’ve seen a few examples of non profits trying to circumvent this problem by creating separate campaigns specifically to raise capital to support their operation efforts. The trick is getting people to want to support the non profit itself and not simply the cause they promote!

  • SKrogh

    This was a spectacular talk. I’ve worked in the non-profit sector, in some capacity, for the last seven years and this is constantly a problem that organizations run into. I’ve seen quite a few comments on here (and on the original TED talk page) about HOW we change people’s views. Transparency is a great first step. Education is the second (education about how non-profits SHOULD work, how money is distributed, the cause, etc.). Think of the 3 million+ people that have already viewed this video. That is 3 million+ MORE people (roughly) thinking about the need for transformation in the non-profit sector than before this talk was given. Changing the stigma certainly won’t be easy, but it can be done.

  • Janna Bartels

    I have never worked in any non-profit organizations, so this video really opened my eyes to the struggles that they deal with. As an individual, however, I agree that transparency and education about the organizations and how non-profits should work would be crucial to changing the stigma concerning the non-profit sector.

  • Palecekb

    Yes, I agree with you when you say that you would maybe donate more if you knew exactly where your money was going. I think that the physically seen outcome of the money spent is what people including me are looking for!

  • Palecekb

    Yes, both ends need to be fixed the donators and the spenders have to be willing to use and spend what it is intended for.

  • BartuchGR11

    That you for posting this video. I found it interesting because I never knew about all the struggles that non profit organizations run into. I always donated to non profits but it does make you wonder if the things you donate do they really not make any profit off of them? I do agree that we need to educate people about how nonprofit organizations should work. That way all nonprofits are run the same way.

  • Alexandra Helena Marie Nicolof

    Though I have heard of big accomplishments from non profit organizations have made, I can understand the foundation of your video. Do you feel that it’s a struggle for these organizations to get money and that is why they emphasize so much on how little they spend? For example, a non profit organization is working on building wells for fresh drinking water over seas. Instead of emphasizing on how well they did and asking for more money in order to do more, they tell about how they didn’t have enough funds to do as much as they wanted in the first place.

  • Alexandra Helena Marie Nicolof

    I think a lot of people feel this way, Palecekb. This semester I raised money for a class I had and one of the reasons why I felt so compelled to succeed was because I knew exactly how the money I raised was going to be used.

  • Alexandra Helena Marie Nicolof

    What’s interesting, is that the ones who donate substantial amounts of money seem to be more informed of what’s going on than the ones who donate smaller portions. I think it’s only fair to be educated on what the money is being used for.

  • Alexandra Helena Marie Nicolof

    Do you guys feel that you get more in return if you donate your time than your money? I mean, besides knowing that your time is well spent, you can also use it to your advantage for education and career building. I’m not trying to point fingers or anything, just a question.

  • Alexandra Helena Marie Nicolof

    What gets me is that non profit organizations actively choose to not always inform the people as to where there money is going, they could be SO much more successful if they did.

  • Max Rude

    That is a very valid point. Maybe they should try to change there public argument style.

  • kolinjk29

    I totally agree with you on where the money really goes. I am always very hesitant when it comes to charity organizations because you never really know where your money could be going. They have to be very reputable but it’s hard to spot those. I always see on tv those charity organizations for dog rescues, but I recently heard that they only give a portion of the donation when people call in. I find this ridiculous and very difficult to trust these organizations.

  • Taylor Bolibol

    This article is interesting to me because I have never thought of it this way. There are tons of money hungry big for profit companies but wouldn’t we want our money to be going into a good cause and changing the world? Shouldn’t we want companies that are making a difference to have all the money?

  • Catey Navarro

    I loved this TED talk. It is so unfortunate but the truth. People aren’t willing to sacrifice a job they know will pay more for a job that will help more people. I am not saying those people are terrible, they are just more focused on a bigger check then helping the homeless or sick. It is a vicious cycle.