Leonardo Letelier is the founder and CEO of SITAWI-Finance for Good, a nonprofit that develops financial solutions for the social sector in Brazil. WINGS caught up with Letelier to learn more about his organization, and to talk about how a new trend he calls “storysharing” can help build a culture of giving around the world.
WINGS: What do you mean by “Finance for Good”?
Leonardo Letelier: We define “Finance for Good” as bringing more capital, more types of capital, and more efficient use of capital to transform more lives. The first product we had was the social loan fund—providing loans to social enterprises in Brazil (for profit and nonprofit) at below market rates. If you’re a nonprofit in Brazil your chances of getting a loan in Brazil are very low, and if you do it’s very expensive. From a donor perspective, someone that gave 100,000 dollars to that fund has had four times the amount of impact, because the money has been lent and come back and lent again and come back, and lent again, etc. We call this the multiplication of social impact effect.
The second product is a cross between donor advised funds, community foundations and fiscal sponsorship; we call it “social fund management for large donors”. In some cases, the process for applying for/providing grants is very cumbersome, hard for the nonprofit. If several funders are involved, it could take six months between making a collective decision and having the funds reach the nonprofit. In this case, what we do is this: twenty funders makes grants to SITAWI once a year, say for 50,000 reais (about 22,000 USD). This creates a one million reais budget in a separate account with full transparency, and when they decide they want to make a grant to an NGO in a favela, instead of six months it takes six days. It’s much more efficient. So this was a real innovation in the sector. When it’s easier to give money, people give more money.
We would love to say that we practice venture philanthropy—giving both money and resources (branding, processes and personnel), taking it to another level with the support of a group of allies—but this takes a lot of resources, and we are a small nonprofit organization. So what we do is to give strategic advice to the executive director. It’s a light touch, for example including coaching or helping to structure decisions they make.
Last march we launched a study on nonprofit mergers. There are about 300,000 NGOs in Brazil that have to fight for 15 billion reais worth of grants every year. When you divide this it ends up about 50,000 reais per nonprofit per year. We’re not going to get very far with that. As a society we need stronger institutions. It’s good that we have new and small and innovative organizations but we also need large, well managed, strong organizations to have significant impact in the sector.
Finally, we also advise financial institutions on how to integrate social and environmental considerations in their investment decision making processes.
WINGS: How is SITAWI working to address the economic climate in Brazil?
LL: One thing we’ve set out to do is create a campaign around giving, called Give More Give Better (stories in Portuguese here). It’s not about giving to us, but about giving and talking about it, so that other people get inspired. We launched the campaign to impact the culture of giving. We formed an informal alliance with a group of organizations interested in changing the culture of giving in Brazil. These organizations have their own initiatives. We have to do all we can both together and on our own.
WINGS: What challenges do you see? Is storytelling one of them?
LL: “Storysharing” is more the challenge. It’s not that we don’t know how to tell the stories. Yes, we can always improve, but if we tell beautiful stories and nobody hears about them they don’t make the point. We use international stories to get people to the website. Bill Gates is an example. But we also collect and share stories from ‘regular people’ so that others can relate to.
Brazil does not have a culture of giving. The laws don’t help but they also don’t forbid you to give. We could improve them, but if we don’t have the culture we won’t fight to change the laws around philanthropy. Creating partnerships is another challenge. This is in part because we have trouble doing business together. The key question is are you going to wait for someone else to solve these challenges so you can do your work, or will you do your work in spite of these challenges.
WINGS: What long term results do you hope to see with your storysharing campaign?
LL: We hope the Give More Give Better campaign will become more independent in the future, that it will take on a life of its own. That’s why we created a separate brand for it, to spin off when the time came. At SITAWI the outcome of what we want is a more robust way of financing social impact in Brazil, and our strategy is to develop and promote these social finance tools. All of what we do requires philanthropic support, so we need more people giving. Storysharing is one strategy for that.
It is worth noting that although we are not going global ourselves with the campaign, one thing we had in mind when creating it is that the stories can be used globally and we will be happy to help if others want replicate it. Each country can have its own campaign and we can share our assets (stories, website) with them. It doesn’t need the same name or logo—others can run it as they see fit. This campaign can be easily replicated anywhere and we have insights on what has worked and not worked in Brazil, and instead of starting with zero stories, you can start with 200 on day one.
WINGS: How can other people and organizations support SITAWI or the campaign?
LL: The easy bit is to share your story with us. Additionally, so far we are the sole funders of the Give More Give Better campaign. If others help fund it, we can do much much more. For example, today everything we do is in text form but with a small grant we can move to videos. This will bring much more attention to our work. So financial support is key.
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