In 2006 Scott Harrison began to wonder what his legacy would be. So, he disrupted his life as a New York City nightclub promoter with the idea of disrupting philanthropy. Seven years on he has, by all accounts, succeeded.
“I got people drunk for a living,” says Harrison, a scheduled speaker at the Web Summit, a Dublin conference to be held October 30th-31st that’s expected to attract some 8,000 attendees this year. “I spent ten years throwing parties and inviting people so they could escape their lives. I was in a situation where getting beyond the velvet rope and paying $20 for a cocktail meant your life had meaning.”
That period in Harrison’s life, which included the use of cocaine, ecstasy and other drugs, came to a screeching halt following what he has calls a “crisis of conscience.” What came next is a page out of the annals of redemption: a life-changing period working off the coast of Liberia with Mercy Ships, an organization that offers free medical care around the world on a floating hospital. (Harrison says he dropped all his vices upon starting with Mercy Ships, but not before “one last hurrah that included too many beers and two or three packs of cigarettes.”) The Mercy Ships experience in turn led in 2007 to the founding of charity: water, a non-profit that raises money to dig wells and build filtration systems and other means to bring underserved people clean drinking water.
His passion for the project has proved contagious: Harrison has taken about 400 potential big donors on trips — including some of the tech sector’s most successful founders — to countries where charity: water has funded water projects, with everybody paying their own way, so they can see firsthand what has been accomplished.
“Almost everybody calls it life changing,” says Harrison. “It’s one thing for me to show a lot of pictures of dirty water on a laptop or to say there are leeches in the water. It’s another thing to see for yourself a 60-year-old woman who has to walk many miles a day to get clean water.”
Hands-on trips like one organized in May to Ethiopia, which raised the biggest investment in charity: water to date tied to a single trip, together with Harrison’s commitment to transparency, have made him and his non-profit popular with techies (one-third of the money to cover operations has come from large donors in Silicon Valley). The Ethiopia trip included Paddy Cosgrave, the founder of Web Summit, and a group of high-profile Silicon Valley and European tech entrepreneurs including Errol Damelin, founder and CEO of Wonga; Daniel Ek, founder and CEO of Spotify, and Michael Acton Smith, founder and CEO of Mind Candy. (These European tech stars are among those scheduled to attend this year’s F.ounders conference in Dublin.)
It is no accident that start-ups in the pipeline for big exits are getting involved in giving back. Like big-name Silicon Valley tech entrepreneurs and investors, they are thinking about not just their companies’ but their own legacies. (See the story on pages one and 23). It is no longer necessary to wait to have the success of a Bill Gates or Sergey Brin to fund charities. The Israeli founders of Waze and the company’s investors were not the only ones to benefit when Google earlier this year acquired the smartphone navigation app for about $1 billion. Some of Israel’s most disadvantaged kids also reaped rewards, thanks to Tmura, which for the past decade has offered high-tech entrepreneurs the opportunity to donate their start-ups’ shares or stock options — as Waze did two years ago — with the eventual proceeds going to charity. More than 300 donations have been made since Tmura launched in 2002 with almost 50 payouts. The sale of the stake in Waze netted Tmura $1.5 million, its biggest ever, and brought its total donations to $9 billion.
Silicon Valley is home to similar initiatives; these include Entrepreneurs’ Foundation of SVCF, a Silicon Valley-based not-for profit 501(c)(3) public charity that is now part of Silicon Valley Community Foundation; and 1% of Nothing, which was co-founded by Harrison; Shervin Pishevar; UK tech entrepreneur Matt Galligan; and Michael Birch, the founder of social network Bebo, which was sold to AOL in 2008 for $850 million and this year repurchased by Birch for $1 million.
The topic of giving back is one that is expected to be discussed during F.ounders, an invitation-only event organized by Web Summit’s Cosgrave, to be held on November 1st and 2nd with some 450 leaders in their fields. Pishevar and Harrison are scheduled to be among them.
“In Liberia on that first trip my heart broke,” says Harrison, 38, who serves as charity: water’s chief executive. “I saw humanitarians helping people and I wanted to do that for the rest of my life. I realized there weren’t charities bursting at the seams with innovation, inspiration and a feeling that anything is possible.”
And so he set out to be all that in a bid to raise awareness and convince potential donors large and small that everybody in the world should have easy access to clean water. An early campaign in New York City’s parks had charity: water juxtaposing tanks of discolored water with photos of people around the world drinking dirty water. Harrison and his colleagues asked passersby if they would drink the water in the tanks; the obvious answer was followed by a call for a donation.
From that modest beginning came a charity powerhouse that has raised $100 million in seven years. The non-profit is on track to raise $40 million this year and Harrison has set the goal of getting donors to give $100 million in 2015, what he calls “ambitious, but achievable.” With those funds charity: water wants to help 100 million people get clean water in the next decade. So far, 9,000 projects in 20 countries have brought clean water to 3.3 million people who didn’t have easy access to it.
Almost 90% of charity: water’s budget is spent on programs, according to charity rater Charity Navigator, which has given the non-profit its top four-star rating, including a perfect score in transparency and accountability.
“When I started seven years ago there was a real disengagement with charities,” says Harrison. “I continued to hear about the black hole problem: ‘I give money to charity and I don’t know where it’s going, they are inefficient and the CEOs get paid too much.’ I thought a good way to get around this was to separate charity: water’s finances between operations and projects in the field.”
This seemingly small idea — assuring the mass of regular donors that 100% of their donation is going to bringing people clean drinking water and covering operating costs with large gifts from 100 individuals and companies — proved to be a winner for Harrison. The large donors, called well members, pledge to give at least $24,000 a year for three years to cover charity: water’s operations, including Harrison’s $195,000 salary (a survey by Professionals for NonProfits showed CEOs of New York-based non-profits with charity: water’s budget usually make between $240,000-$280,000) and those of his 66 employees.
Separating the finances was but one of many innovative ideas Harrison has come up with.
“I think I just came at it so differently because of my background,” says Harrison. “We don’t know what traditional fund-raising looks like. Not having a background in international development or fund-raising helped because in some ways I didn’t know any better. I have never responded to direct mail and I don’t know anybody who does so. When I started the organization I said we’re not going to do that, we’re going to find new things to get people excited and engaged in the issue.”
One way charity: water does that is by sending donors photos and GPS coordinates of the wells their money helped build. Harrison has also found fund-raising success by encouraging people having a birthday to ask friends not to give a gift, but instead to donate the number of dollars (or euros or pounds) equivalent to the birthday being celebrated.
Harrison — in conjunction with 1% of Nothing — is also working to get start-ups to donate 1% of their equity to charity: water. The non-profit receives money from a payout if and when the equity stake is sold in an IPO or other operation.
Like many charities, charity: water has turned to social media to promote its cause, and raise funds. However, few have been as successful. A current campaign called Water Forward, on the other hand, has raised almost $1 million for the organization, which developed the idea together with Monkey Inferno, an incubator created by Bebo founder Birch.
“We’re absolutely looking to get more Europeans involved,” says Harrison. “I was in Berlin earlier this year meeting entrepreneurs there. The values of transparency and efficiency are not limited to Silicon Valley or Silicon Alley in New York.”
Following the trip to Ethiopia, Mind Candy’s foundation made a gift to sponsor a school project and Tim Ferriss, the author of “The 4-Hour Workweek,” raised $107,000 in a campaign linked to his 36th birthday.
Before the Ethiopia trip Wonga’s Damelin raised $76,000 for charity: water in conjunction with a marathon he ran in Antarctica while Birch and his wife have donated $6 million in seven years and have pledged $4 million more.
Harrison’s success in getting Birch and other millionaires to continue covering overheads while smaller donations keep flowing in will ultimately determine the former nightclub promoter’s legacy and just how much he manages to disrupt philanthropy.