Picture a big thermometer, that well‐known symbol of many a fundraising campaign. Each donation is documented in red, pushing the “temperature” higher and higher toward the campaign's total dollar goal. That image might be a fitting symbol for a previous generation of givers, but it is the antithesis of what next gen donors want to be a part of today and going forward.

For one, the thermometer metaphor focuses solely on dollars given, not on the results and impact fostered by those donations. The thermometer also makes it seem like the only role donors can play is to give cash—or encourage others to do so. Next gen donors insist that they have valuable assets to give beyond money, and those assets are valuable because they leverage more impact. Rather than measuring their impact as a line in a fundraising budget, next gen donors want to measure the real difference all their contributions make on the causes they care about. Seeing real‐world impact is what gets them excited about giving.

Impact Obsession

We'd be hard‐pressed to find any donors of any age who say they don't care whether their giving makes much of a difference. But for next gen donors, impact is everything. As the leaders of the new Golden Age of Giving, as donors with unprecedented resources and the power to revolutionize philanthropy, making a tangible difference is their top philanthropic focus. They want an Impact Revolution. They want to reshape philanthropy in ways they believe can finally lead to meaningful progress on our toughest challenges.

We can see this impact fixation in some of the philanthropic ventures already created by next gen donors. Facebook cofounder Mark Zuckerberg and his wife, Dr. Priscilla Chan embody Generation Impact. They created the Chan Zuckerberg Initiative (CZI) in December 2015, in celebration of the birth of their first child, and committed to using CZI to give the vast majority of their multibillion‐dollar fortune to philanthropic purposes over their lifetimes.¹ CZI is a charitable LLC that reveals both the founders' hugely ambitious goals and their willingness to use a nontraditional approach to giving—one meant to allow them maximum flexibility to pursue promising solutions. In 2016, for example, CZI announced a $3 billion, ten‐year investment in health care, with the audacious goal of “helping cure, prevent, and manage all diseases in our children's lifetime.”² Whereas previous donors might have defined such an initiative around a particular treatment (e.g., “investing in new diabetes medications”) or a particular institution (e.g., “expanding the endowment of the world‐famous Mayo Clinic”). These next gen philanthropists defined their plans around a breathtakingly bold end result, a big impact.

Zuckerberg's Facebook cofounder, Dustin Moskovitz, along with his wife, Cari Tuna, have placed “measurable impact” at the center of their considerable philanthropic initiatives. Through Good Ventures and the Open Philanthropy Project, they make their giving decisions solely based on which investments or interventions will “do the most good.”³ The causes they focus on are not determined by their personal passions or experiences—as they are for so many donors—but by what data and research suggest are the issues or solutions that can save or help the most lives. If that means giving for criminal justice reform or malaria prevention rather than for rural libraries or urban green space, then so be it. The potential for maximum measurable impact on humanity is their deciding factor.

Another version of this impact‐focused approach is the “hacker philanthropy” of tech billionaire Sean Parker. As a group, Sean says, hackers are already “intensely idealistic, so as they begin to confront the world's most pressing humanitarian problems, they are still young, naïve, and perhaps arrogant enough to believe that they can solve them.”⁴ So when he set up his own foundation, he declared, “We will only target very big specific problems that are ‘tip‐able,’ where we see a path to victory and where we can make a catalytic impact.”⁵

Impact is not just an obsession of next gen donors from the tech community, however. Our interviews with Gen X and Millennial donors of many backgrounds, from inheritors to earners, showed the same desire. Impact is what they want—and worry about—most. One talked about having “a nagging itch in the back of my mind: Am I really doing the most good I could be doing?” Another explained her primary challenge in giving as such: “When I look at my own giving, I get so overwhelmed because I go, ‘Where can I have the most impact?’” Similarly, when we surveyed over 300 major donors in their 20s and 30s, we asked them to indicate the importance of various reasons for engaging in philanthropy. Out of 23 possible choices, they ranked “seeing that my contribution makes a real difference and the organization has real impact” as one of the top three reasons for giving.

Moving the Needle

Of course, younger donors are not the only ones who say they want to “make a difference” with their giving. This sentiment is a common one found in surveys and interviews on the motives and goals of many types of donors, including older high‐net‐worth philanthropists and Millennial donors across the economic spectrum.⁶ And research on how donors act suggests that impact matters. Experiments by psychologist Paul Slovic and others have shown that what really matters for people deciding whether to give to provide life‐saving interventions (e.g., sending aid to a refugee camp) is not the sheer number of people who would be helped, but the percent of the total in need who could be helped.⁷ Donors are more likely to contribute to help, say, 90 percent of 100 people in a single village destroyed by an earthquake than they are to help 10 percent of 10,000 people in a bigger region—even though the total number helped is much smaller in the first case (90 versus 1,000).⁸ Most donors, it seems, don't necessarily want their contribution to be “just a drop in the bucket.” They like to see that their giving matters.

So what makes the impact focus of next gen donors different from past generations?

What's different—and what leads us to call them “Generation Impact”—is how highly they prioritize impact, how much they emphasize seeing impact over all other criteria for judging their giving, how specific and passionate they are about what they want to change to achieve more impact, and how far they want to innovate to achieve this greater impact. They draw a line in the sand between the philanthropic approach of previous generations and the impact‐first approach they want to take.

When we asked next gen donors how they were different from their parents and grandparents, in fact, the most common theme in their answers was impact. Many rejected quite strongly what they saw previous generations doing—giving to “gain social status or participate in the right social circles,” giving merely out of “obligation,” or giving for the quid pro quo exchange of “you give to my charity and I'll give to yours.” Instead, they insisted they give in order to make a real difference, to “move the needle fundamentally and substantially on an issue.” One donor claimed he was “impact‐based rather than who's‐who‐based,” unlike his parents, and another said she wanted to “be very focused on a problem,” not just on “having a reputation.” This donor made a similar stark comparison: “I want proof of impact. I believe my parents give much more for the ‘feel good’ feeling that comes along with giving, whereas I am dead‐set on maximizing the impact of my philanthropic dollars.”

Next gen donor and social entrepreneur Daniel Lurie has built a new model to address the age‐old problem of poverty in the San Francisco Bay Area, and he has leveraged over $120 million from donors, including those who are considered next gen and believe he's onto something. He offers a terrific example of the next gen donors' distinctive—some might say single‐minded—focus on impact, their willingness to try out new models to change the philanthropic landscape and to finally move the needle on long‐standing issues.

Daniel is clearly passionate about trying to alleviate poverty, but he doesn't think trying is enough. He wants results. And he's frustrated that despite the previous generations' efforts to fund poverty eradication programs, poverty continues to rise. Something needs to change to make more of an impact.

What Daniel has done to try to “move the needle” on poverty illustrates well what other next gen donors want to do to make philanthropy more impact‐focused. They want to try different models, take new risks, and look for evidence of effectiveness. They want results.

The Power of Seeing

Next gen donors say they want impact, but what do they mean by that? Do they agree on the definition of impact? When we pressed our interviewees to describe what they meant by impact, we heard a number of explanations. For some it was about demonstrated outcomes—some sort of evidence that they had made a measurable difference, like the higher graduation rate among charter school students. This donor even said that seeing the impact in emotional ways was not as important as seeing these actual measurements: “Most nonprofits simply talk about the problem they're solving and what they're doing about it and show you pictures of happy kids to show that impact and to pull on your heartstrings. But they don't necessarily measure how much impact you get, how many happy kids you get per dollar that you give in. It is not exactly clear.”

For others, impact meant clearer evidence that results were tied to their particular contribution, or that their contribution was being used effectively to help solve problems or create change. As one person explained, impact meant making sure that the money “actually is going to provide an added benefit to a user, a community, a school, or something, and to be able to see that happen.”

Ultimately, the most common answer when we asked what impact meant was an indirect one. Next gen donors define impact as “being able to see something happen as a result of giving.” These next gen donors might not have a single, shared definition of impact, but they know they want to see it. While this approach might not be the best definition of impact—as we will discuss later—it was by far the most common.

Not surprisingly, next gen donors are particularly enthusiastic about site visits. They love being able to “see the impact in front of your face.” One donor called it her most “fundamental experience” to “both see need and see the nonprofit community step in and make an extremely concrete, real difference in people's lives.” Another donor talks excitedly about a site visit he made to Central Africa: “I traveled with a small team, to kind of see the situation in person and to come face‐to‐face with what we have been discussing in what I thought was a more abstract way, sitting around the board table in a Manhattan office. That appealed to me. It was an incredible experience. Coming face‐to‐face with what I hoped we would support more in the future.”

Next gen donors like site visits because they can see the outcome of giving and understand how this giving is working to make an impact. Sure they can read the mission statement for, say, the Boys and Girls Club they fund. But going to the club and hearing the children tell their personal stories about how specific programs helped them stay safe, build life skills, or prepare for college is much more powerful.

These rising generations—especially the Millennials—have grown up in a world full of screens, which may explain why they yearn to see the impact their giving has had “face‐to‐face” rather than virtually. One donor who works in computer science made this argument directly:

I'm a tech guy. I love the virtual. But actually, a picture, a 3D video, whatever, will not convey the same feeling as if you just get out and travel there. When you go to a site visit or a town or a community [as a donor], you're not going to go there and walk around by yourself. You're going to get a tour, and a tour is going to involve other people. So you see that human emotion. You can see either the passion in their eyes or the gratefulness in their eyes or a bit of both. That's the driving force.

Many Gen Xers and Millennials have also been encouraged since they were very young to get out from behind their screens and get involved in community service and volunteering. So for some, their passion for seeing impact is tied to their passion for being hands‐on in their giving. As with site visits, they feel that volunteering allows them to be physically present and to confirm, as one puts it, whether their money “is going to the right place, to the right people, where it can make a big difference.” Another donor says that volunteering helps “me know who I'm helping, and how I'm helping them.” Several also told us that this need to see, touch, and contribute in hands‐on ways really distinguishes them from prior generations.

Of course, we must ask, will next gen donors, with all their earnest bravado, stick around to see those impacts that take longer to achieve and measure? Will they bring humility and openness to the process of changing practices that affect lives and livelihoods? These will be important questions as the Impact Revolution in philanthropy unfolds.

What Does This Mean?

The potential upside of the Impact Revolution is immense. If donors with unprecedented resources give in new ways that do in fact leverage significant impact, we can make progress on problems we've struggled with for a long time, and advance causes beyond what we've ever seen. We could, as Priscilla Chan and Mark Zuckerberg want, cure or manage all disease. We could, as Daniel Lurie wants, help millions more people find a path out of poverty. Big impact is possible if big giving envisions it.

But revolutions are messy—even revolutions driven by the haves versus the have‐nots; even revolutions fighting for change in board rooms and institutions versus in the streets. Revolutions are messy even if the intentions of the revolutionaries are noble and positive. How can we prepare ourselves for the messiness? What changes should we brace ourselves for? And what unintended consequences or unforeseen pitfalls should we look out for?

The impact‐first orientation of next gen donors can be a boon for nonprofits working to attract and retain these donors, but nonprofits need to think carefully and creatively about how they show impact. Fundraisers will certainly want to emphasize impact as the top‐line message in their pitches to next gen donors. And nonprofits will want to find ways to put next gen donors in direct, personal contact with their organizations as well as with the people their organizations support, whether through site visits, volunteer opportunities, or simply the chance to hear the real stories of clients they serve.

Face‐to‐face encounters with impact are possible even if in‐person meetings are not. Take an organization started by next gen social entrepreneur Charles Best. In 2000, when he was a 24‐year‐old high school history teacher in the Bronx, Charles founded DonorsChoose.org, a website where public school teachers post information about classroom projects and needs and donors choose which projects to support. DonorsChoose.org allows donors to see the teacher, project, and even the kids they are funding, providing both photos and details like budget and goals. They also get updates on the project's progress, and the DonorsChoose.org website has an ongoing “impact” page complete with an “explore our data” button. This approach appeals to the next gen because it gives these donors both a personalized sense of who they are helping and a clear sum of the impact they are making.

While seeing impact is exciting and motivating, providing personal meaning and fulfillment for the donors, we all need to be aware of some potential downsides of how zealous these next gen donors are for seeing impact. The primary focus must always remain on the real, complex needs and goals these donors are funding. Both nonprofits and donors need to be careful that the Impact Revolution doesn't devolve into misguided efforts to keep big donors happy with staged site visits showing only the positive sides of the hard work for social change. This is a worry that many nonprofit leaders surely have, and the savviest of next gen donors we spoke with share the concern. They still passionately want their giving to show impact, but they want that impact to fit what organizations truly need and to do what will lead to substantial change regardless of the optics.

Another challenge is that not all causes or organizations do work that produces impact that can be monitored in clear, “face‐to‐face” ways. The outcomes that some groups fight for can be too big, too remote, too complex, or too subtle and intangible to see easily (think of changing attitudes about racial violence). And some of the solutions that will ultimately produce the greatest cumulative impact won't be able to show tangible, donor‐pleasing results in the short‐term (think of basic scientific research to understand what causes cancer).

While it is vital that nonprofits try to show their impact—and the process of getting to that impact—in all its complexity, they also have to think carefully about how they can show donors their outcomes in appealing ways. It can be a tall order to highlight your positive outcomes for donors while still defining those outcomes in ways commensurate with the nature of their cause and in ways that demonstrate evidence of long‐term change.⁹ We believe nonprofits and next gen donors can become better partners in effecting change if the donors learn about and witness the challenges nonprofits grapple with. The good news is next gen donors say they are eager to have this sort of close, honest relationship with the nonprofits.

Ideally, nonprofits and next gen donors can develop enough of a relationship that they define impact together. Donors can express the change they want to see in the world, and nonprofits can explain the complex nature of the problem they address and the struggles they face in fighting it. The two parties can mutually agree on what impact means in each complicated case and come up with the most appropriate performance and impact measures. Both parties then buy in to that meaning of impact and hold each other accountable for achieving it.

But again we have to ask this: Will next gen donors, with decades of giving ahead of them, have the patience to stick around to see the real change their giving can have on long‐term, complex issues? Time will tell. But some of the next gen donors we talked to were keenly aware of this challenge and tried to take the long view. One thoughtful donor explained, “You're investing in an organization; you want an ongoing relationship with them. It's probably long‐term. Real problems take several years to solve, laying the groundwork and identifying areas of need, and going through many, many different stages. You might not see the outcome for a while. But I think we're able to operate at a scale where our giving would be most effective over a period of time rather than just a one‐time, one‐year thing.”

Next gen donors will certainly push philanthropy to be even more focused on vehicles that allow “giving while living,” preferring this to setting up perpetual foundations or waiting to make “planned gifts” from their estates after they pass away.¹⁰ As we will see throughout this book, they dislike waiting until they retire to give, so waiting until they die is even less appealing. This means that raising money from next gen donors for endowments or bequests will probably be more difficult. But again, they want to develop close relationships with organizations, and if doing so shows them that the organization needs such deferred‐impact gifts, they could be persuaded to give them.

A related challenge is whether donors want to fund specific programs or core operations.¹¹ We know that donors of all sorts often prefer to fund programs, especially programs with visible beneficiaries or easy‐to‐see outcomes and new programs that are full of promise and innovation. Surveys and experiments consistently show that a primary concern people have about giving to charity is the worry that too much of their contribution will go to overhead or fundraising costs.¹² But as nonprofit leaders—and many of the emerging donors we spoke with—know all too well, the greatest resource they need in order to increase their impact is either unrestricted funds or support for talented staff, adequate space, and even core “R&D.”

Because of their special, outsized role, next gen major donors have an opportunity to help shift the field beyond this simplistic approach of making funding decisions by looking at overhead costs. Yes, these rising donors want to see impact, and yes they are excited about funding new ideas and new tools, tendencies that might lead them to prefer program funding. But as Daniel Lurie knows, funding organizational capacity and operations is often the best way to accelerate impact, especially over the long term.

Revolutions are never easy, but revolutions designed to create more good in the world can be worth the trouble. The coming Impact Revolution in philanthropy could be so, if we all go into it with eyes wide open.