Aggregating Demand, Targeting Impact

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 quot;public goodquot; or private goodquot; social entrepreneurs. quot;Public goodquot; 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. quot;Private goodquot; 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