Venture Philanthropy and Funding for Nonprofits: Firms, Models, and Tips
Explore how venture philanthropy supports nonprofits; plus top firms, funding models, and real-world tips to strengthen your fundraising strategy.
Posted June 5, 2025
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When most people hear the word "philanthropy," they picture writing a check to a favorite nonprofit. But today, giving is evolving. More donors want to see real, measurable change, not just good intentions.
Venture philanthropy isn’t just about giving money, but it’s also about investing time, resources, and expertise to help nonprofits grow stronger and create a lasting impact. It borrows the best ideas from venture capital, like hands-on support and long-term partnership, but applies them to solving social challenges instead of scaling businesses.
In this guide, we’ll dive into how venture philanthropy works and why it’s helping communities build real, sustainable change from the ground up.
What Is Venture Philanthropy?
Venture philanthropy is about rethinking how we create change. Instead of just giving money to nonprofits and hoping for success, venture philanthropy takes a more hands-on, strategic approach. It treats nonprofits like mission-driven startups: providing funding, mentorship, tools, and active support to help them grow stronger and more sustainable over time.
The goal? To build long-term solutions for some of society’s toughest challenges.
Venture philanthropists don’t just invest in ideas, but they invest in leadership, infrastructure, and measurable outcomes. They believe that with the right support, nonprofits can scale just as effectively as businesses, and that strategic growth leads to deeper, longer-lasting community impact.
How Does It Differ From Traditional Philanthropy?
| Traditional Philanthropy | Venture Philanthropy |
|---|---|
| One-time donations, often without ongoing involvement | Long-term partnerships focused on growth and measurable impact |
| Emphasis on funding specific programs or needs | Emphasis on strengthening the entire organization (leadership, operations, scalability) |
| Limited feedback or accountability required | High engagement: regular progress tracking, capacity-building, and outcome measurement |
| Success often judged by activities (how many served) | Success judged by outcomes (what actually changed, long-term effect) |
Think of it like the difference between giving someone a fish versus teaching them how to build a sustainable fishing business, and then mentoring them until they thrive.
Types of Venture-Style Funding Available to Nonprofits
Today’s funding landscape offers nonprofits more than just traditional grants. If you're building a high-impact, scalable organization, venture-style funding models could help you grow faster, smarter, and more sustainably. Here’s what you need to know about each major type:
Venture Philanthropy (Grants + Advisory Support)
Venture philanthropy blends traditional grantmaking with hands-on strategic partnership. Funders don’t just write checks, they also often offer coaching, operational support, leadership training, and help with scaling models.
When it’s a good fit:
- You have a scalable model but need capacity-building support (operations, hiring, leadership coaching).
- You're ready for rigorous reporting and willing to engage deeply with funders.
Funders like New Profit, Skoll Foundation, and Draper Richards Kaplan typically offer 3–5 years of support, plan for a multi-year relationship, not a one-off grant.
Impact Investing (Low-Interest Loans, Recoverable Grants, Equity for Hybrids)
Impact investors aim for both financial return and social impact. They often provide patient capital in the form of:
- Low-interest loans (to be repaid over time)
- Recoverable grants (grant that must be repaid if certain outcomes are met)
- Equity investments (for social enterprises with earned-revenue models)
When it’s a good fit:
- Your organization generates revenue or can realistically repay a loan.
- You’re willing to share detailed financials and impact data regularly.
Many nonprofits partner with community development financial institutions (CDFIs) or impact funds focused on healthcare, education, or sustainability for this type of financing.
Program-Related Investments (PRIs) from Foundations
PRIs are specialized funding tools foundations use to advance charitable goals while potentially recovering their capital. They come as low-interest loans, equity stakes, or loan guarantees, and count toward foundations' required annual giving.
When it’s a good fit:
- You're tackling a core social issue aligned with a foundation’s mission (like healthcare access, education equity, or environmental justice).
- You have a reasonable path to financial sustainability.
Foundations like the Gates Foundation, Ford Foundation, and Kresge Foundation have active PRI programs. Applications are more rigorous than grants, expect due diligence similar to an investment process.
Revenue-Based Financing or Earned-Income Strategies for Social Enterprises
Social enterprises (even nonprofit-affiliated ones) that generate their own revenue can explore revenue-based financing: repayments are tied to future revenue rather than fixed schedules.
When it’s a good fit:
- You have predictable or growing earned revenue (e.g., fees-for-service, product sales, consulting services).
- You want flexible financing without giving up equity.
Build strong, transparent financial models, funders will want to see exactly how and when you expect revenue to grow and repayments to occur.
What Are the Firms for Venture Philanthropy Partners?
If you're serious about learning from or collaborating in this space, knowing the leading venture philanthropy firms is key. These organizations actively shape how nonprofits grow, innovate, and serve communities better.
Here are some of the most notable venture philanthropy partners:
1. New Profit
- Founded: 1998
- Headquarters: Boston, Massachusetts
- Specialties: Venture Philanthropy, Nonprofit, Social Innovation, Social Entrepreneurship, and Growth
- Sample Portfolio:
New Profit is one of the pioneers of modern venture philanthropy, based in Boston and founded in 1998. Their approach goes beyond just writing checks; they invest in breakthrough nonprofits with unrestricted multi-year grants while actively helping leaders strengthen their strategy, leadership, and systems for growth. What makes New Profit unique is their focus on social innovation at scale, partnering with changemakers tackling everything from workforce development to education reform.
2. Draper Richards Kaplan Foundation
- Founded: 1994
- Headquarters: Menlo Park, California
- Specialties: Venture Philanthropy, Nonprofits, Early stage, Social Entrepreneurship, Board Governance, Scale, and Foundation
- Sample Portfolio:
DRK Foundation is where early-stage changemakers go when they need more than just a check, but they also need a real partner. DRK backs bold nonprofit founders right at the messy, critical beginning of their journey, offering three years of unrestricted funding plus deep, hands-on mentorship. Think of them as part coach, part connector, part early believer. If you have a big idea that can tackle urgent social problems, and you’re serious about scaling it smartly, DRK gives you the space, strategy, and network to get there.
3. Mulago Foundation
- Founded: 1993
- Headquarters: San Francisco, California
- Specialties: Philanthropy, Health, Education, Conservation, Social Entrepreneurship, and Agriculture
- Sample Portfolio:
Mulago Foundation is laser-focused on one thing: scalable solutions to poverty. They fund organizations that build models that can grow big and move the needle for the world’s poorest people. Mulago doesn’t get distracted by flashy pitches or complicated structures. They want simple, powerful ideas that deliver real change, and they back those ideas with unrestricted funding and tough, practical coaching. If your nonprofit can prove it has a clear, cost-effective path to big impact, Mulago is the kind of partner that will help you scale it the right way.
4. Social Venture Partners (SVP)
- Founded: 1997
- Headquarters: Seattle, Washington
Social Venture Partners (SVP) is all about the power of community-driven change. Instead of just writing grants, SVP builds long-term partnerships between local nonprofits and business leaders who want to roll up their sleeves. They offer a mix of funding, mentorship, and capacity-building support, helping nonprofits sharpen their strategies and deepen their impact. What makes SVP stand out is their local focus; they work city by city, investing time, talent, and money into solving community-specific challenges. If you’re looking for funders who will truly stand alongside you (not just above you), SVP is the kind of partner you want.
5. Robin Hood Foundation
- Founded: 1988
- Headquarters: New York, New York
- Specialties: Grantmaking, Poverty Alleviation, Management Acceleration, Capital Grants, and Disaster Relief
- Sample Programs:
Robin Hood Foundation is New York City’s largest poverty-fighting organization, but what really sets them apart is how data-driven and results-obsessed they are. They invest in organizations that can prove they’re moving the needle on economic mobility, education, housing, and health. Robin Hood brings a mix of grants, strategic support, and rigorous impact measurement to the table, pushing nonprofits to deliver real, lasting change. If you’re serious about solving poverty at scale (and willing to back it up with hard numbers) Robin Hood is the kind of high-accountability partner you want in your corner.
Read: How to Get Into Venture Capital: Lessons Learned Interviewing 100+ Investors
Impact Investors Open to Nonprofits and Social Enterprises
Not every impact investor is looking for startups chasing billion-dollar exits. Some are serious about backing organizations (including nonprofits) that deliver scalable social change. Here’s a breakdown of real options for mission-driven founders:
Acumen
- Founded: 2001
- Headquarters: New York, New York
- Specialties: Nonprofit, Poverty, Social Enterprise, Impact Investing, Venture Capital, Private Equity, Social Entrepreneurship, International Development, Climate Change, Agriculture, and Education
- Sample Portfolio:
Acumen is a pioneer in impact investing, built around one core idea: patient capital can solve problems that markets and traditional charity can’t. Since 2001, Acumen has invested in early-stage companies (and occasionally nonprofits) tackling poverty, healthcare, energy, and education across the globe.
What makes Acumen stand out is their long-term view: they don’t expect quick wins. They invest in bold, often risky ideas that need time to grow, backing founders with both capital and leadership development. If you’re building a mission-driven venture that’s solving real problems for underserved communities, Acumen is the kind of funder that bets on real grit and results, not just flashy decks.
Omidyar Network
- Founded: 2004
- Headquarters: Redwood City, California
- Specialties: Philanthropic Investments, Social Change, Social Impact, Philanthropy, Grant Making, and Digital tech
Omidyar Network is all about big, systemic change, and not just funding individual projects, but reshaping how entire systems like democracy, education, and the digital economy work. Founded by eBay’s Pierre Omidyar, the Network funds both nonprofits and mission-driven businesses that tackle the root causes of inequality and injustice.
They’re known for being flexible with how they invest; mixing grants, equity investments, and advocacy support, but they expect a bold vision and real strategy from the organizations they back. If your work pushes for deeper, structural change rather than surface-level fixes, Omidyar Network could be one of your most aligned partners.
Blue Haven Initiative
- Founded: 2012
- Headquarters: Cambridge, Massachusetts
- Sample Portfolio:
Blue Haven Initiative is a next-generation family office that’s serious about aligning every dollar with positive social and environmental impact. They invest across asset classes, from early-stage startups to nonprofits, with a focus on scalable solutions in energy, financial inclusion, and sustainable economies.
What sets Blue Haven apart is how hands-on and values-driven they are: they don't just invest for good optics; they look for real, measurable impact alongside strong financial thinking. If you’re building something that can drive lasting change and operate with business rigor, Blue Haven is the kind of thoughtful, long-term partner you want to meet.
RSF Social Finance
- Founded: 1984
- Headquarters: San Francisco, California
- Specialties: Investing, Lending and Giving, Sustainable Food and Agriculture, Ecological Stewardship, and Education and the Arts
- Sample Portfolio:
- Boldr.
- Mad Capital
- Bright Power
- Alabama Waldorf School
- See more here.
RSF Social Finance is built around trust-based finance for mission-driven organizations. RSF provides loans, grants, and investments to nonprofits and social enterprises working in fields like education, food systems, climate, and the arts.
What makes them different is their emphasis on relationship-driven funding; they focus on transparency, shared values, and collaboration between borrowers and investors. If you’re a nonprofit or social venture looking for patient, values-aligned capital (not just financial transactions) RSF could be the rare funder that truly works with you, not just over you.
Open Road Alliance
- Founded: 2012
- Headquarters: Washington, D.C.
- Sample Portfolio:
Open Road Alliance exists for one clear mission: to keep high-impact projects from falling apart when the unexpected happens. They specialize in fast, flexible funding, offering emergency grants and loans to nonprofits and social enterprises facing sudden obstacles like funding delays, political instability, or supply chain breakdowns.
What sets Open Road apart is their speed and pragmatism: they’re less about long applications and more about getting critical projects back on track quickly. If your organization is doing powerful work but hits an unexpected roadblock, Open Road could be the bridge that keeps your impact moving forward.
Traditional Venture Capital Firms (That Rarely Fund Nonprofits – But Sometimes Fund Hybrids)
If you’re running a pure nonprofit, traditional VC firms generally aren’t your path; they seek scalable, revenue-generating models. But if you're building a social enterprise, a public benefit corporation (B-corp), or a hybrid structure that blends profit with impact, a few forward-thinking VCs might be open to you. Here’s who to know:
Kapor Capital
- Founded: 2009
- Headquarters: Oakland, California
- Specialties: Education Technology, Consumer Finance, Health IT, Venture Capital, and People Operations Technology
- Sample Portfolio:
Kapor Capital backs early-stage startups that are serious about closing gaps in access and opportunity, especially for communities historically left out of tech, education, and healthcare. They focus on companies where social impact is baked into the core business model, not treated as a side project.
What makes Kapor Capital different is their belief that diversity isn’t just good ethics – it’s good business. If you're building a venture where making a difference drives revenue and outcomes, Kapor Capital could be the kind of mission-aligned investor you want on your side.
Afore Capital
- Founded: 2016
- Headquarters: San Francisco, California
- Specialties: Venture Capital, Seed Stage Venture Capital, Pre Seed Venture Capital, Entrepreneurship , and Founders
- Sample Portfolio:
Afore Capital specializes in pre-seed investments, backing founders often at the idea stage, before they have much traction, but when the vision is strong. They’re not just looking for polished decks; they’re looking for gritty, resilient builders solving real-world problems. What sets Afore apart is how founder-first they are: they invest early, bet on unconventional ideas, and help shape companies from day one.
If you’re a purpose-driven entrepreneur with a bold, scalable model (especially in tech or mission-driven spaces), Afore could be one of the few VCs ready to believe before the world does.
Collaborative Fund
- Founded: 2010
- Headquarters: New York, New York
- Specialties: Investing, Technology, and Startups
- Sample Portfolio:
Collaborative Fund invests at the intersection of culture and technology, backing startups that make the world more sustainable, healthier, and fairer. They’re especially drawn to companies where doing good and doing well are inseparable.
With a focus on areas like climate tech, health, and financial access, Collaborative is known for supporting founders who rethink old systems in bold ways. If your business model ties positive impact directly to growth and scalability, Collaborative Fund could be a strong, values-aligned partner from early on.
What Nonprofit Founders Need to Know About Venture Funding
If you're leading a nonprofit and hoping to secure "venture funding," it's important to understand how this world actually works, because traditional venture capital and philanthropy operate under very different rules. Here's what every serious nonprofit founder should know:
Why Traditional Venture Capital Rarely Funds 501(c)(3) Nonprofits
Venture capitalists (VCs) are investing for financial returns. They seek companies that will grow quickly, generate profits, and eventually provide an exit (IPO, acquisition, buyout) where investors cash out at a multiple.
Nonprofits, by definition, reinvest revenue into their mission rather than returning profits to investors. That makes them structurally incompatible with the expectations of typical VC firms.
If you're a 501(c)(3), you won't attract classic VC funding, and you shouldn't waste time chasing it.
The Rise of Venture Philanthropy and Impact-First Investing
Instead of seeking profits, venture philanthropists invest in nonprofits the way VCs invest in startups, but their "returns" are measured in social impact, not dollars.
Similarly, impact-first investors (especially family offices and mission-driven funds) are increasingly channeling money toward organizations that can deliver measurable outcomes in health, education, economic mobility, or climate solutions.
You need to demonstrate you can "return" social impact at scale and with clear evidence, just like a startup would show growth metrics.
Hybrid Models Are Gaining Traction (Nonprofit + Social Enterprise)
Some of the most innovative nonprofits today are building hybrid models: a traditional 501(c)(3) arm combined with a social enterprise that generates earned revenue.
Example: A nonprofit that trains underserved youth might launch a business arm offering staffing services, blending mission and margin.
This hybrid structure allows founders to tap both philanthropic and impact investment capital, offering more financial resilience and growth options.
If you have a revenue-generating component tied closely to your mission, consider formalizing a hybrid structure early. It expands your funding universe dramatically.
Program-Related Investments (PRIs) Are Another Option
Foundations are increasingly using Program-Related Investments (PRIs) to fund nonprofits or social ventures. PRIs are low-interest loans, equity investments, or loan guarantees made by foundations to support charitable activities, and still count toward their required philanthropic distributions.
If you're tackling a complex, scalable issue, especially in healthcare, education, or climate, you could qualify for PRIs in addition to traditional grants. But you'll need to show repayment potential or clear deliverables.
How Nonprofits Can Position Themselves for Venture-Style Funding
If you're serious about attracting venture-style funders, it’s not enough to have a good mission, but you also need to run your organization like a high-performing startup. Here's what truly matters:
Focus Relentlessly on Outcomes, Not Just Activities
Funders aren’t impressed by how busy you are; they want to see what actually changes because of your work. Instead of saying "we hosted 50 workshops," show how those workshops led to higher literacy rates, lower dropout rates, or measurable behavior change. Outcomes are your new language.
Build a Model That Can Scale Thoughtfully
Venture-style funders want to know your impact can grow without the wheels falling off. It’s not just about adding locations, it's about proving you have processes, partnerships, and leadership capacity to expand without diluting quality.
Hybrid Structures Open More Doors
Pure nonprofits sometimes face limited funding options. Social enterprises, B Corps, or nonprofit/commercial hybrids naturally fit more capital strategies. If you can generate earned revenue alongside your mission (like sliding-scale services or product sales), you’ll be seen as more investable.
Show Strong Leadership and Board Governance
Talent and governance matter -- a lot. Funders look for founders and leadership teams who are mission-driven and operationally sharp. A strong board with fundraising, financial, and strategic expertise signals that your nonprofit should be professionally managed.
Speak the Language of Investors, Not Just Donors
Replace general storytelling with clear KPIs, a realistic strategic plan, and a path to long-term sustainability. You’re building a business case for impact. Metrics like cost per outcome, lifetime value of a beneficiary, and projected scale per dollar invested make you stand out in a room full of grant seekers.
Common Venture Philanthropy Models and Structures
Not all venture philanthropy operates the same way. Different firms use slightly different models based on how they believe they can create the greatest long-term impact.
Here are the most common models you'll encounter:
1. Capacity-Building Model
Instead of funding a single project, donors invest in strengthening the entire nonprofit; leadership development, operations, hiring key staff, and improving financial systems.
When it's used: When the organization has high potential but needs stronger infrastructure to scale sustainably.
2. Milestone-Based Investment
Funding is released in phases as the nonprofit hits specific performance goals (similar to venture capital tranches).
When it's used: When scaling requires measurable progress. For example: doubling service reach, piloting new programs, or expanding geographically.
3. Catalytic Capital Approach
Foundations or venture philanthropists take risks where others won't; funding early pilots or risky but potentially transformational ideas.
When it's used: When traditional funders won’t support unproven but high-potential innovations.
4. Blended Finance Model
Philanthropy collaborates with investors, corporations, or the government to unlock bigger funding packages. Sometimes it’s grants plus loans, or grants plus equity investments.
When it's used: When solving a complex problem (like public health access or education reform) needs cross-sector muscle to succeed.
Are There Any Risks and Tradeoffs of Venture Philanthropy Funding?
Venture philanthropy brings powerful opportunities, but it's not without risks, especially for nonprofits working to stay true to their missions. One major challenge is the pressure to "chase metrics." Because outcomes and KPIs are central to venture philanthropy, organizations can sometimes find themselves focusing on what’s easily measurable rather than what’s most meaningful. The best funders work closely with grantees to define thoughtful, mission-aligned metrics, not just quick numbers.
There’s also the risk of mission drift. As nonprofits scale quickly, the pressure to grow can cause them to lose sight of their core populations or compromise their original model. Organizations that thrive through this growth phase are the ones that stay crystal-clear about what they will (and won’t) compromise along the way.
Another common risk is over-reliance on a single funder. Venture philanthropy funding often comes in powerful but time-limited cycles, and if an organization doesn't diversify its funding base during that window, it can face a painful "funding cliff" when the partnership ends. Smart nonprofits use venture philanthropy to strengthen long-term sustainability, not just to expand programming temporarily.
Finally, cultural clashes can be an obstacle. Many nonprofits are rooted in grassroots activism, while venture philanthropists often come from finance, tech, or investment backgrounds. Successful partnerships build mutual respect early: nonprofits educate funders about on-the-ground realities, while funders offer strategic advice without trying to steer the organization like a business.
Tips for Nonprofits: Preparing for Venture Investment
Venture philanthropists are looking for organizations ready to scale smartly and deliver measurable results. If you want your nonprofit to attract venture investment, preparation is key.
Here’s exactly what you need to have ready, right before you approach a venture philanthropy firm:
Clear, Data-Backed Theory of Change
Be ready to explain why your model works, not just what you do. A good theory of change ties every activity to a bigger outcome, and shows how your work creates real, lasting impact.
Have a simple 1–2 page version ready, backed by evidence or early results where possible.
Impact Metrics That Matter (Not Just Vanity Stats)
Metrics must connect to outcomes, not just outputs. It's not enough to say "500 students served", but you also have to show what changed for those students.
Choose 3–5 core impact indicators you can track consistently over time. Quality over quantity wins.
Audited Financial Statements and Transparent Budgets
Expect tough questions about your financial health. You’ll need clean, audited financials from the last 1–2 years + a clear breakdown of how new funds would be used.
Highlight smart investments you’ve made in leadership, infrastructure, or technology, and not just programming.
Scalable Operating Model
Venture philanthropy firms back organizations that can grow without breaking. You’ll need a model that can replicate in new locations, serve more people, or deepen impact, without proportional increases in cost.
Show examples of past expansion (even small ones) and what resources it took. Prove that growth is thoughtful, not reckless.
Leadership Bench Strength
Founders matter, but venture philanthropists also want to see a capable team. Who will carry the mission forward if leadership changes?
Prepare a short organizational chart showing key leaders, roles, and how decision-making authority is distributed.
Documented Systems and Playbooks
Scaling is not just about hiring more people. It's about replicating success predictably. Funders love seeing that you have internal manuals, SOPs, or scalable processes, even if they're still evolving.
Share a sample onboarding document, training manual, or process map to prove you're thinking about scale beyond intuition.
Risk Assessment and Plan B Strategies
Venture philanthropists know nothing ever goes perfectly. Be ready to discuss potential risks (funding gaps, staffing, regulation changes) and how you’re preparing for them.
Have a simple risk matrix ready: top 3 risks + mitigation strategies for each.
Story of Why Now
Above all, venture investors want to feel urgency. Why is now the right time to bet on your growth? Why is your solution needed more than ever?
Tie your story to broader societal trends, crises, or shifts, and make it feel timely and inevitable.
Want help preparing your nonprofit for venture philanthropy funding? Connect with a coach who’s helped social enterprises raise millions.
Bottom Line
If you're leading a nonprofit and thinking seriously about this path, preparation is everything. Funders aren't just looking for passion; they're looking for clear models, proven outcomes, strong teams, and a readiness to grow thoughtfully.
Focus on building your story, your systems, and your metrics with the same rigor that you'd expect from any high-performing organization. The nonprofits that succeed in securing venture philanthropy support aren’t necessarily the biggest, but they’re the ones that prove they can deliver real, lasting change at scale.
With the right preparation, the right mindset, and the right partners, you can turn bold ideas into bold impact, and create lasting transformation in the communities you serve.
Launch Your Business Successfully with the Help of an Expert
Nonprofit organizations rely heavily on donations, investments, and other funding to make sure the work they’re doing changes the communities they serve. If venture philanthropy is on your radar, you might have a lot to learn – and we can connect you with an expert to help you get started right away.
Working with an entrepreneurship coach will help you gather the best tools and resources you’ll need to start your journey toward owning and operating your own nonprofit.
Read next:
- What is Venture Capital and How Does it Work?
- Jobs in Venture Capital: Your Guide to Employment
- 10 Finance Internships for Freshmen in College
- How to Get a Venture Capital Internship
FAQs About Venture Philanthropy and Nonprofit Investors
What is the difference between venture philanthropy and traditional philanthropy?
- Traditional philanthropy often supports charitable organizations through one-time grants or donations, with less focus on long-term outcomes. In contrast, venture philanthropy applies investment strategies to support nonprofit organizations, offering both funding and non-financial support like strategic advice, leadership development, and operational guidance to help them grow sustainably.
What is the venture philanthropy approach?
- The venture philanthropy approach is about giving strategically, backing organizations the way investors back startups. It means providing flexible, multi-year funding plus mentorship, much like a philanthropic investment organization would. Groups like the European Venture Philanthropy Association have helped formalize this model across global markets.
What are the three types of philanthropy?
- Traditional Philanthropy: direct donations to support causes or services.
- Venture Philanthropy: strategic funding with hands-on partnership to scale high-performing nonprofit institutions.
- Corporate Philanthropy: businesses supporting social causes through grants, sponsorships, or service programs.Major differences often involve whether the funder also provides personal contacts, leadership training, and growth planning beyond just writing checks.
What is social venture philanthropy?
- Social venture philanthropy focuses on investing in organizations that address deep systemic issues, especially those serving low-income families, children and youth, or advancing causes like early childhood development. It concentrates money and mentoring on initiatives where great leaders can create scalable impact, not just temporary fixes.
