GuideStar is the largest platform of information about data for nonprofits. In this segment, Jacob Harold, President and CEO of GuideStar, talks about how both individual donors and nonprofit executives leverage the data that GuideStar curates. He also discusses the danger of “short-termism”– of thinking everything happens on a quarterly basis. He explains that if you’re trying to build a great company, it takes years or decades… and the same is true for social change.
The following is conversation between Jacob Harold, President and CEO of GuideStar, and Denver Frederick, host of The Business of Giving, on AM 970 The Answer in New York City.
Denver: It is a bit ironic that at a time when we have more information and data than at any other time in human history, our ability to predict the future and to make sound decisions has never been less. And one reason for that may be because not enough people are thinking about how to make this data accessible, meaningful, and truly useful. That is why the nonprofit sector is so fortunate to have someone like Jacob Harold, the President and CEO of GuideStar…who just happens to be with us now. Good evening, Jacob, and welcome to The Business of Giving.
Jacob: I’m thrilled to be here, Denver.
Denver: Some listeners may never have heard of GuideStar. For those who have, they may be thinking: “Oh, Yeah, Yeah. The 990 tax form people.” So, let’s start by having you tell us what GuideStar is, and what you do.
Jacob: You bet! GuideStar is the largest platform of information about data for nonprofits. And let’s just start by saying: Why do we even care about having data about nonprofits? And for me, it’s to address what I call “the elephant in the philanthropic room,” which is simply that some nonprofits are better than others. Some are able to squeeze more good out of the dollars that they spend. It’s not necessarily that those that are not as effective are bad people, but they haven’t figured out the most effective way to do good in the world.
So the challenge that donors face and that nonprofit executives face…and researchers and government officials… is trying to find excellence in the field, to learn from it… to make sure it gets the resources it needs. And so GuideStar’s mission is to help in that process: to provide the kind of information so that the “stakeholders of social change”–the people who have a stake in the work of the nonprofit sector–are able to make good decisions with their time, and with their money, and with their attention, with their passion. So, we provide data. And historically that’s mostly been, as you said, from the IRS Form 990, the tax form that most nonprofits are required to file. But we realize that that’s a very powerful foundation of data, but none of us would tell our own story through our 1040. And we need to supplement that with other kinds of information to tell a richer story about nonprofits. And so that’s what we’re really trying to do at GuideStar right now. And we’re having some success; we have about 7 million people each year who use GuideStar.
I had a chance to work for a whole set of different environmental organizations: Green Corps, Greenpeace, Rainforest Action Network. And I got to know dozens of others. And it became very clear to me in my early 20s that some of these organizations were simply far more effective. And it led me to a question: ‘Well, okay, how are we going to tackle a great challenge like climate change if we’re not sending money to where it can be most effective?’
Denver: That’s right. And you really get into the inner workings of all this data and how the whole philanthropic system works. Where did that come from? What kind of background did you have that instilled this into your DNA?
Jacob: In some ways, it came from the dining room table at the house I grew up in. Both of my parents worked for small community-based nonprofits. My mom worked at an AIDS hospice. My dad worked for Catholic Social Services, providing services to the poorest of the poor in our community. And so over the dining room table, I would hear about the struggles faced by those people who are devoting their lives to try and make the world better. And these were my parents!