Beyond Philanthropy
Dec. 11, 2007
by TIM OGDEN
Philip and Donna Berber’s passion for helping Ethiopians help themselves has been decades in the making. Donna remembers making a commitment to do something for Ethiopia in the mid-80’s while watching the original Live Aid concert. It wasn’t until the late-90’s that all the pieces had come together. Around the time that Philip was selling the online trading company he had founded, Donna made her first visit to Ethiopia. Says Philip, “The truth is that it was my wife who had the vision and the heart to care about those in need. It was Donna who felt the pain and saw the need; her path led us to Ethiopia. When I made my first visit to Ethiopia, I realized there was something way more important [than my career]. There was a really meaningful and purposeful use for this wealth that had come our way.”
Despite that emotional connection that Philip felt on his first trip to Ethiopia, he hates to use the word “giving” to describe his family’s efforts: “People speak of giving. I don’t think we’re giving anything. I think we’re reinvesting wealth in the well-being of others. Giving is often a thoughtless act. Investing requires a different mindset. I say that we’re social investors working with social entrepreneurs to create a social profit. And that’s not just terminology, it’s a different mindset. When you adopt that mindset, you reject much of the traditional thinking in international aid. And you can see the opportunity to address the root causes of poverty in our lifetime. That’s the essence of what we’re doing. Some would call it business-thinking, some would call it accountability, some would call it entrepreneurial. It doesn’t matter what you call it. What matters is how you do it. There are really good people with really big hearts investing themselves completely [in international aid] but that’s not enough. It takes both heart and smart to make this thing work.”
The Berber’s have adopted a different approach to international giving than many donors, taking their cue from a neighbor in Austin. “You could call it the direct approach. Just like Dell did. We sat down and turned the thing completely upside-down and back-to-front. We came in with a blank sheet of paper. We saw the flaws in the channels of distribution [of aid], in the proliferation of middle men, of the methodologies in place. We wanted to know how we could help Ethiopians help themselves, how we could help them lift themselves out of poverty.”
That “blank sheet” beginning led the Berber’s to invest in expertise, both professional and personal: “The first thing we did was hire an expert. In business when you’re going into a new area what you really need is some domain expertise. You need someone who’s an expert or a specialist in the field. We hired the person at the Ethiopian embassy who was the coordinator for all NGO’s [non-governmental organizations] working in Ethiopia. We hired an Ethiopian because we knew nothing about Ethiopia or aid or any of the issues. Second we did extensive research, extensive due diligence and turned as many stones as we could to really understand international aid, charities, NGOs, overheads, methodologies. There was a huge opportunity to do this in a far more effective way that would be sustainable and that’s where it all started. We learned that so much of what is wrong is Westerners sitting in their ivory towers pointing fingers at the Africans, telling the Africans what it is they need to do.”
The Berber’s founded A Glimmer of Hope Foundation to provide aid to Ethiopians (and to poor communities in Austin, TX and London) as directly as possible. “We went to rural villages. We started by asking the question: ‘What do you need?’ As simple as that might sound that’s not how international aid is traditionally done. We quickly realized a couple of things. The people in the villages are not used to being asked [what they need and want]. Second, organizations do exist that are local, self-help organizations run by Ethiopians for Ethiopians. They are educated, they are smart, they’re motivated, they have capacity, but they’re poor. They only thing they are really lacking is capital. So all we did was enter into partnerships with local organizations at a local and regional level that already knew what they needed, already had a plan, already had a budget. We’ve replicated that formula everywhere we work in Ethiopia. In each of the 4 regions we work in, we have multiple local partners. We are enabling and empowering them to help themselves.” What does that help look like? Thus far the Berbers have funded the digging of approximately 2000 water wells, built several hundred schools, and helped create more than 150 health projects.
Not all of their partnerships have worked: “We make small investments into new partners, on a pilot basis to see if they have what it takes to be a long-term implementing partner. Its like investing in a portfolio of money managers. When things haven’t worked, what we’ve most often found is organizations that didn’t have the ability, capacity or will to deliver, to get the project done on time. It’s not because of corruption. It was not because of mismanagement, they just didn’t have the management expertise.” One way they maintain oversight is by funding on a quarterly basis. While a project may have a multi-year timeline, it also has quarterly goals to meet. If the project isn’t on track, then funding can be put on hold.
Despite some of the challenges, the Berber’s are more committed to partnerships in Ethiopia and around the world than ever: “We have learned and matured over the few years we’ve been working in this area and one of the things we’ve learned in the value of collaboration and partnership. In the early days we shunned or didn’t embrace the opportunity to work with and learn from others who were more established in the field. Now 7 years later, we’re more mature in that regard. We are one very small player in a very large pool. We work with a variety of [people and organizations] in the United States, but more importantly we have partners in Ethiopia and that’s how we get the work done.”
Donna and Philip pay attention to metrics to evaluate partners but also rely on qualitative measures: “Being who we are, the qualitative are as important as the quantitative. Experiencing and seeing the impact of our work by visiting a family in their straw and mud hut or visiting a rural community and bringing our children and allowing them to see and feel and experience and understand and see the impart that we’ve been able to have. To be able to see the smile of a child who is drinking clean water, who no longer has parasites in his belly, who’s healthy, who’s sitting in a classroom at a desk. I don’t have a spreadsheet for that and I’m not looking for one. Though we do have the spreadsheets. The fundamental thing for us is how much did it cost and how many people benefited, and therefore what’s the cost per head? [That measure] allows us to compare different projects, different partners, different regions. We don’t seek to burden our partners with an excessive reporting process. There’s a lot of organizations out there that I believe are driven by fear that require these mounds of information back in return for their money. We prefer to have our own people travel from Addis [Ababa, the capital of Ethiopia] to touch and see and feel for themselves. To meet the people rather than having an office full of people crunching numbers.”
By combining these measures, though, they’ve had remarkable success. Thus far the organization has assisted more than 2 million people, at a cost per person of around nine dollars. “By having Ethiopians in charge and by having a narrow geographical focus we’ve been able to achieve some remarkable things. We have a 95% success rate with water projects which is the bulk of what we’ve done.”
When asked what advice he would give other donors, Philip is reticent for the first time in the conversation: “It’s a very personal pursuit. There’s a lot of advice I could give but the act of philanthropy, the act of social investing, is a very personal pursuit.” But he does have a bit of advice to give: “There’s no substitute for doing the research. Many people have heard of the large brands [in charity] and they fail to do the homework, like understanding exactly how the money is used. Wealthy people are too worried about making mistakes. They are worried about doing it wrong so they stick to what they’ve heard of. People aren’t willing to take the risks. But if you do your homework, you’ll see that it can be done with great impact, effectiveness and efficiency.”