Stacy Donohue is director of investments at Omidyar Network, a philanthropic investment firm. Below, she writes about a new report from Knight Foundation, “The Emergence of Civic Tech: Investments in a Growing Field.” Photo credit: Flickr user Sunlight Foundation.

What do the Sunlight Foundation and Airbnb have in common? At first glance, not much. The first is a nonprofit watchdog group exposing the influence of money in U.S. politics, while the second is a for-profit online travel rental site.  But in fact, as Knight Foundation’s new landscape study demonstrates, they are both residents of the emerging sector Knight calls “Civic Tech.” 

This study looks expansively at the civic space, crossing boundaries between emerging venture-funded markets, such as the sharing economy and collaborative consumption, and traditionally philanthropic-driven sectors related to government data transparency. It is a creatively coherent landscaping of both organizations and funders, which is a most welcome addition to the field.   RELATED LINKS

“Pulling back the curtain on civic tech” by Jon Sotsky on Knight Blog

“New tools produce better understanding of investments in civic tech” by Sean Gourley on KnightBlog

“The Emergence of Civic Tech: Investments in a Growing Field” on Slideshare.net

“Civic Tech Directory.xslx,” a landscape list of civic technology projects by Jon Sotsky

“Knight Foundation’s civic tech report: why it matters” by Tom Steinberg on KnightBlog

“Civic tech report helps ID opportunities in the field” by Keya Dannenbaum on KnightBlog

“Urban neighborhoods take small steps into ‘civic tech‘” by Patrick Barry on KnightBlog

There are several highlights worth noting:

Civic tech is a high-growth, investible space. There is a relatively robust amount of for-profit capital going into the open government cluster of the landscape.  This is a significant change from even a few years ago. Organizations like Open Knowledge Foundation and the Open Data Institute have pioneered innovative models to find sustainable business models around open data. As our recent piece on this topic affirms, we at Omidyar Network are focused on fostering sustainable financial models in the civic space, so it’s encouraging to see the positive trend here.

Venture investors and philanthropic funders have more in common than they might have thought. The wide variety of funders—from venture investor to foundation, large corporation to high net worth individual—is striking, and begs the question of when and how each of them might break out of their typical ways of deploying capital to enhance the growth of the entire ecosystem. For example, grants and donations have been a major driving force supporting data transparency and data utility. The work of organizations such as Code for America, Sunlight, the Open Data Institute and others has been extremely catalytic in creating a movement around open government data. This cultural shift can also benefit civic tech companies with a commercial model. Such complementarity suggests that commercial investors might also consider donating to support these types of organizations to benefit the broader sector.

Conversely, the fact that for-profit companies are playing a major role in redefining how we think of “civic” and “community” suggests also that philanthropies with a civic purpose might further their mission by supporting some of these new business models. Such program- and mission-related investments are allowed by the Internal Revenue Service, and Knight and Omidyar Network, among others, have availed ourselves of the flexibility to help build the sector.

This is not just a U.S. phenomenon. As the Knight team points out, this data set is a first cut, which includes a few organizations outside the U.S. that attracted significant funding during the study window (such as mySociety, Open Knowledge Foundation and the Open Data Institute). The next step is to populate the data much more thoroughly on the international front to reflect the innovations in civic tech from countries as diverse as Kenya, Nigeria, India, Mexico, Brazil, and to recognize the collaborations between innovators across countries, such as Code for America’s Code for All initiative. Mapping the commercial and philanthropic funders outside the U.S. would be a hugely helpful resource to the field.

“Impact investing” has started to attract a wide variety of funders. Yet, most self-described impact investors today focus on developing world infrastructure, health, education and finance/credit. One of the exciting possibilities that emerges from Knight’s way of defining the landscape is the idea that Civic Tech, previously considered a niche, also has the characteristics of a large, growing, innovative and investible sector that can attract both for-profit and nonprofit investors. For me, the coming together of previously disparate worlds—Open Government and Community Action, nonprofit and for-profit—represents a compatible combination.