Successful start-ups and global tech companies like Facebook and Google have created some 76,000 millionaires and billionaires in California’s Silicon Valley. Yet all this wealth has had consequences for other residents. “It has driven up housing prices. It has driven up office space costs. It has driven up the cost of living,” says Heather McLeod Grant, co-founder of Open Impact, a social impact advising firm. “You have people who, literally anywhere else in the country would be middle class, and they’re the working poor here.”
Increasingly, struggling families are turning to nonprofits for help and finding that many of these organizations are themselves strapped financially. But why? After all, the region’s wealthy are generous. McLeod and her Open Impact co-founder, Alexa Cortés Culwell, report that individual Silicon Valley philanthropists gave away nearly $4.8 billion in 2013 alone, and every year they are giving more. “When you look across individual philanthropy, private foundations, and the growth of donor advised funds, they’re hockey stick charts,” Cortés Culwell tells us. “The number of private foundations has nearly doubled since 2000. The issue is, where is the money going?”
That’s the subject of The Giving Code: Silicon Valley Nonprofits and Philanthropy, a new report by Cortés Culwell and McLeod Grant. In this podcast, the pair discuss their investigation into what they call Silicon Valley’s “prosperity paradox”. They explain why local donors are largely unaware of the immense challenges right in their own backyards, and they share their thoughts on how wealthy donors and local nonprofits can work together more effectively to address the region’s growing needs.
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McLeod Grant and Cortés Culwell: Bridging the Divide Between Nonprofits and Philanthropy in Silicon Valley
Inside Philanthropy article: How Much Should The Wealthy And Foundations Give In Their Home Regions?
Open Impact on Twitter
Feature image: Open Impact founders Alexa Cortés Culwell and Heather McLeod Grant
