Venture Philanthropy Partners (VPP) is a high-engagement philanthropic organization based in the DC metro area. It was founded in 2000 by Mario Morino, Raul Fernandez, and Mark Warner to invest in high-performing nonprofits in the National Capital Region. Since then, it has made over $40 million in direct investments in nonprofits serving children and youth.
VPP has a high-engagement model with its nonprofit partners, and provides technical support along with its grants. It makes investments in three areas: Early Childhood, Education, and Youth Transitions.
Its investment partners, past and present, are currently serving more than 42,000 children and youth around the National Capital Region.
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VPP's mission is:
We aim to help strong leaders make their organizations as effective as they can be. And we hope to demonstrate the value of making strategic, engaged, highly leveraged investments to build and strengthen nonprofit organizations.[1]
VPP's approach differs from traditional grantmakers in that it does not ask for grant applications, but seeks out high-performing organizations with the capacity to grow to serve more children and youth. It focuses on general operation support and not on programmatic expenses, another deviation from the traditional grantmaker model. Its investments are tailored to increase the capacity of nonprofits so that their growth can be sustained once the investment life cycle is complete.
Once VPP finds a potential nonprofit partner, it goes through a due diligence process to determine the potential for a partnership, appropriate timelines for an investment, and the necessary steps to move forward. Typically, a VPP investment partnership lasts anywhere from 2-5 years and can involve a $500,000 to $5 million investment.
In its first fund, VPP focused on serving more organization with smaller grants. In its second fund, it shifted to a focus on larger and longer investments in fewer organizations.[2]
VPP began its first fund in 2000, with an investment in Heads Up, a local DC organization that provided after-school programming to area youth. In the subsequent nine years, VPP made an investment in a total of 12 organizations. These investments had varying degrees of success, with some expanding rapidly into new areas, while others faltered and did not meet expectations.
In total, VPP invested over $31.4 million into these 12 organizations. Additionally, VPP also leveraged an additional $32 million in funds for these investment partners, creating a more than 1:1 ratio of invested dollars and additional outside, leveraged donations.[3] VPP has a large network of influential people across the National Capital Region, some of whom are board members and some of whom are donors to VPP itself, and VPP frequently taps into that network on behalf of the nonprofits it supports.
VPP's first portfolio expanded into more than 45 new neighborhoods and opened up over 20 new sites. As of 2010, the portfolio organizations had expanded to serve 16,000 more youth.[3] Much of this growth was into the Maryland suburbs outside DC, as that region, like many US suburbs, was experiencing a rapid influx of low-income and immigrant communities.[4]
This is the full list of VPP's Portfolio I investments[5]:
At the close of its first portfolio in 2007, VPP decided to continue its work and begin to raise funds for a second round of investments. Learning from the first fund, VPP decided to make fewer investments, but with more resources devoted to each investment. As of summer of 2011, VPP had made two direct investments and one networked investment, including an investment in KIPP DC for $5.5 million, its largest investment to date.[6]
This is the full list of VPP's Portfolio II investments, as of Summer, 2011.[6]
youthCONNECT is VPP's investment in a network of nonprofits in the National Capital Region. youthCONNECT is funded in part by the Corporation for National and Community Service's Social Innovation Fund[7], and will result in a $12.8 million investment. The overall goal of the network is to improve the lives of 20,000 youth in the National Capital Region by 2015.[8]
The youthCONNECT investment is a part of VPP's second fund, but is a different approach to investments than VPP has done before. Instead of making an investment in one organization, it has invested in six. These six together form youthCONNECT. Leaders and programmatic staff meet regularly to discuss the goals of youthCONNECT and provide support to each other as they work to meet these goals. They also operate under a "shared outcomes framework" which aligns all their activities towards the network's goals.
Additionally, the network investments are investments in programs, and not organizations, which is another difference from VPP's traditional investments.
The rationale behind switching to a "network approach" was that VPP began to realize that solving large societal problems cannot be done by a single organization. Instead, many organizations must work together with a common framework for action to affect change in a significant way.[9] This approach is similar to the "collective impact" model for change that the social impact consulting firm FSG has developed.[10]
This is the full list of VPP's youthCONNECT investments:[8]
More learning resources from VPP
The Economist article on social innovation
The Edna McConnell Clark Foundation