Imagine for a minute a world in which you did not reap the benefits of your investment. You still invested in the market but the profits and losses would not be allocated to you, they’d be given to someone else. How would you make your investment decisions? You would not care whether your investment turned a profit or not so you would not use that criteria. Your investing would be haphazard at best.

Unfortunately this is the reality in the nonprofit sector. Our “investors” do not reap the benefits of our work. They give on behalf of someone else, someone they most likely will never meet. I’ve written often about this fundamental distortion and it continues to plague my thinking. So how can we try and correct this uniqueness in the nonprofit sector?

1) Think in terms of outcomes. It is very easy to become a donor who gives to what is cool, trendy, or makes you feel good. It’s easy because that is the easiest thing to base our decisions on. Try and move beyond that. Peruse some annual reports, talk to a staff member, try and meet someone who benefits from the organizations work.

2) Think critically. When making investing decisions we think critically about the business model, leadership, and product that a company has to offer. Do the same when it comes to your philanthropic giving. Does the model they are using make intuitive sense? Do they have research to back up what they are doing? Does it seem like they are offering something that is making a difference in the world?

3) Don’t stress. Celebrate your philanthropic efforts and don’t let them become overly burdensome. If you even move a little into the investor mentality you are leaps & bounds beyond most donors. There are very few organizations where your money will actually do damage, thinking like an investor is all about maximizing the return of your philanthropic gift which is an unattainable goal.