Venture philanthropy (VP) is a modern and relatively young form of philanthropy. It is a new way of investing in social ventures with a social purpose to enable them to create a larger and more sustainable social impact. VP is also considered as the new model for ‘Grant making’: the making of a gift’. The biggest difference with a traditional gift, pure charity without the desire for anything in return, being that that VP requires compensation in the form of a social or financial return.
Distinction with traditional philanthropy
VP differs from traditional philanthropy by a combination of:
- A larger involvement of the venture philanthropist in the social venture
- Attention for organizational development
- Custom made financing
- Non-financial support
- Granting access to complementary networks.
- Multi-annual cooperation
- Impact management