The rise of social responsibility and its core principles has been transformative at every level of the business world, and lately it has been making noise in the world of venture capital. Case in point: Draper Richards Kaplan (DRK), a major Menlo Park-based venture philanthropy foundation, has earmarked $65 million to fund 100 new entrepreneurs working on socially-minded business ideas. These enterprises are working on solutions to many of the world’s most pressing and complex problems, from education to poverty alleviation, the environment and access to healthcare.

Venture Philanthropy

Since the foundation launched in 2002, they’ve supported about 100 organizations, averaging more than a 50 percent compound annual growth rate in revenue. The success has been beyond impressive: only six of the organizations funded by DRK have ceased operations. Last month, they announced the most recent infusion of charitable dollars; the foundation awards three-year seed grants of $300,000, and is especially hands-on, appointing managing directors to serve on the board of each of the organizations it funds.

In the past, oversight in the social sector has been considerably more lax than in more traditional business categories. Pam Scott, founder of The Curious Company and a grantee of the fund, characterizes them as “a bit soft.” With DRK, she says, it’s a different story: the foundation goes “way beyond providing funding. They don’t take a ‘hands off and hope you do good work’ approach,” she says. “They get all up into your business to enhance the performance of their social entrepreneurs and how they achieve impact.”

The foundation is headed by James Bildner, founder of the J. Bildner & Sons gourmet grocery chain and former CEO of California-based Tier Technologies. Binder turned his focus to philanthropy over ten years ago, and hasn’t lost any of his passion for the work. “We’re looking for big problems,” he says. “We want to figure out how you really address water safety. How do you really address homelessness? What about climate change? These issues are only getting worse.”

DRK grantees include both nonprofit and hybrid nonprofit/for-profit companies doing work addressing issues of social justice, education, healthcare, poverty alleviation and the environment. Among them is Sanergy, a hybrid organization that sells toilets at cost to local East African entrepreneurs. By doing this, they help to create small businesses, and are able to turn the waste into organic fertilizers for local famers. 2.5 billion people lack access to hygienic sanitation; by making it affordable and accessible, Sanergy is helping to build healthier East African communities.

Other successful DRK investments have included One Acre Fund, Room to Read, Kiva, and EducationSuperHighway. For more information about the DRK Foundation and their work, visit their website.

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