Benefunder's Innovative High Impact Giving
The philanthropic sector is overdue for disruption. Philanthropy is stuck in the 20th century and has failed to evolve to meet the expectations of the next generation of donors seeking to address notable gaps in research and innovation funding. In the US alone, $390B in charitable contributions are made annually, yet donor satisfaction ratings struggle to exceed the 40% mark and major inefficiencies plague the sector in general. Furthermore, research, which has arguably been the greatest source of innovation and societal benefit, still only attracts less than 4% of total philanthropy.
This is a major market inefficiency, only exacerbated further by a lack of government funding. Benefunder sees this as an opportunity for a large scale shift in how society approaches science philanthropy. In order to respond effectively, we need to think differently. A modern, donor-centric approach is required which addresses primary concerns among philanthropists and displaces the current siloed approach. The solution needs to promote collaboration to improve access, efficiency, and information sharing to address primary motivations behind giving. The Benefunder marketplace seeks to redefine the roles of philanthropic organizations and to activate new funding sources to bridge the innovation deficit.
Introducing a Marketplace for Research Funding
Marketplaces create a multiplier effect when they disrupt the status quo and drive efficiencies through improved transparency, volume, and the attraction of new stakeholders.
Benefunder is a solution that directly connects donors and researchers by providing a platform that negates the need for requests for proposals (RFP’s), grant applications, and high fundraising costs. Benefunder solves for the primary factors which inhibit additional funding by directly matching stakeholders, improving access to data, and creating scalable cost-effective channels for philanthropic activity.
Benefunder’s products and services are very closely related to common offerings in the wealth management industry. They range from pooled accounts, similar to mutual funds, to self directed accounts, and premiere offerings similar to that of a private bank. Each product line is defined by minimum distribution requirements and service levels. The Benefunder team serves as a philanthropic specialist to wealth advisors and donors in much the same way a fixed income or large cap value manager would guide investments in the financial markets.
The marketplace currently features 700+ vetted researchers under contract and profiled on the Benefunder platform, national research institution partners, and donor advised fund partners with reach to several of the nation’s top wealth management firms.
Vetted based on previous funding sources and recommendations from their host institutions. They are required to sign a Benefunder Researcher Agreement which outlines their roles and responsibilities in the marketplace, including the development of a profile, use of funds, ongoing reporting, and good standing with their host institutions.
Partner institutions have pre-negotiated funding terms, make recommendations on participating faculty, have operational protocols in place, and agreed upon use of brand and marketing materials.
Benefunder partners with major donor advised fund (DAF) providers. These partners provide a flexible philanthropic account structure for clients including tax deductible receipts, the ability to contribute a variety of asset types, the ability to make distributions to philanthropic causes over time, and a low cost structure. They bring the added benefit of an existing donor base as well as distribution agreements with major wealth management firms.
As the primary resource for financial guidance for wealthy families, they have a vested interest in providing referrals to specialists that can improve the client experience and identify new opportunities to manage client assets via DAF accounts.