Aggregating Demand, Targeting Impact (Aggregare la domanda e puntare all'impatto)

Against the background of extremely high transaction costs in the nonprofit sector, this paper analyzes how philanthropic funding can be targeted in appropriate ways to social entrepreneurs, depending on their being public good or private good social entrepreneurs. Public good type social investments are likely to never provide a direct positive return in economic terms, though they may contribute to economic progress overall, such as the upholding of human rights, and must be funded accordingly. Private good type social entrepreneurs provide goods or services that create both social value and monetizable economic value, and are best scaled by corresponding forms of funding. The paper analyzes options for demand aggregation and timing, cautioning that technical analysis needs to be balanced with relationship considerations that typically co-determine philanthropic funding