Enseñanzas clave
- Philanthropy begins by identifying the problems you care about solving, not just the organizations you want to support.
- Philanthropy is one tool that can be combined with others to solve problems.
- Meaningful impact often comes from combining financial resources with expertise, relationships, advocacy, and community engagement.
- Philanthropy can help families strengthen shared values, teach stewardship, and create a lasting life of consequence.
At the core of philanthropy sits the simple desire to give back. For many, it’s usually as easy as picking a charity or cause and donating to it, but with wealth, opportunities multiply. With so many worthy causes to choose from, many donors soon realize it’s harder to affect change than they thought.
Questions quickly emerge. Which organizations should receive support? How can charitable dollars make the greatest difference? Is it possible to address the issues that matter most in a more intentional way?
According to Avery Fontaine, Head of Purpose at PNC Private Bank, the conversation should begin somewhere else entirely.
"The more important question is not where should I give," she says. "It's what problem am I trying to solve?"
Shifting one’s perspective allows random acts of giving to turn into a meaningful plan, ensuring that your actions are consequential instead of simply hopeful.
Start With The Problem, Not The Donation
When starting one’s charitable journey, donors will frequently look at existing charities or community needs as a place to start, and while there’s merit to this strategy, it’s not usually the most effective.
For greater impact, instead of just looking at charitable recipients, identify an issue or two that resonates with you and reverse engineer from there.
For some, that may be affordable housing. For others, it could be education, healthcare, addiction recovery, economic mobility, or another personal-shaped or community challenge.
By focusing on the underlying problem, donors can gain a wider picture of the landscape surrounding it and the opportunities available to affect change.
"As individuals become more liquid and their wealth grows, their capacity to use resources and solve problems increases,” Fontaine says. “For example, as business owners reach a transition point, they often begin thinking more intentionally about their personal role in creating change.”
Choosing The Right Strategy For Your Goals
Identifying the impact one seeks is the first step. The second step is considering sources and uses of capital. Which assets and investment vehicles best align with this family's behavioral patterns, goals, and impact statement?
"The first time an enterprising individual explores the spectrum of social investment, they realize this is a problem-solving exercise with less control and more variables," Fontaine says. "Many business-owners-turned-philanthropists find they enjoy solving the puzzle. Which capital needs can they supply at what points in the ecosystem to alleviate burdens and relieve friction?"
Depending on their goals, donors may choose to deploy capital through a variety of approaches:
| Traditional Philanthropy | Venture Philanthropy | Private Markets | Public Markets | |
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| Return Expectations | No financial return | Concessionary/Catalytic | Market-rate to above-market rate | Market-rate |
- Vehicles and Tools Used Most Often to Fund Across the Spectrum:
- Donor-advised funds (DAFs): Creating a flexible charitable vehicle that allows donors to contribute assets today while recommending grants over time.
- Private foundations: Establishing a formal structure that can support long-term charitable objectives and family involvement across generations and/or allow greater flexibility in support beyond grants. Many private foundations today use their corpus for program-related investments – recyclable capital for nonprofits to use project-by-project. Think of it as a low-cost loan that helps the nonprofit improve their technology or get a new revenue stream going, for example.
- Impact Investing: Deploying capital that targets specific impact objectives and a financial return. Often supporting social entrepreneurs solving a specific problem where risk-tolerant, patient capital is needed.
- Thematic & Values Investing: Any investor can screen or tilt a public investment portfolio towards their views. Religious beliefs often drive initial interest in this form of capital deployment. But once an investor accesses the data and understands how they can view their portfolio through multiple lenses, they enjoy the transparency.
- Additional Strategies for Effective Problem-Solving:
- Research and advocacy efforts: Supporting data collection, policy research, public awareness, or systemic initiatives designed to address root causes.
- Volunteer leadership and board service: Contributing expertise, professional experience, and relationships to organizations advancing important missions.
- Family philanthropy initiatives: Engaging children and future generations in charitable decisions to help reinforce values and prepare them for future stewardship responsibilities.
The most effective philanthropists often combine several of these strategies and tools rather than relying on a single approach. A family focused on education, for example, might support local nonprofits, fund scholarships, invest in education-focused social enterprises, and contribute expertise through volunteer leadership. Not one solution, but a combination, creates the greatest impact.
Draw On Trusted Expertise
One of the most common mistakes donors make is assuming that financial resources automatically translate into expertise.
While successful entrepreneurs and business leaders possess valuable knowledge, experience, and business prowess, this can lead to overconfidence in other areas they may have less experience with.
"The biggest mistake they make is trying to be the expert in everything and not trusting the professionals," says Fontaine.
This philosophy is often described as trust-based philanthropy. The idea is simple: donors should take the time to understand an issue, learn from practitioners and community leaders, and then empower those experts to do their work effectively.
The hope is that, through proper vetting and occasional oversight, one’s money will go much further in helping a cause than it would otherwise. Supporting the mission is often more important than running it when it comes to philanthropy.
Impactful philanthropy recognizes that solving complex problems often requires collaboration among nonprofit leaders, researchers, government agencies, social entrepreneurs, and community stakeholders. No single donor can solve a problem alone.
Philanthropy Is About More Than Money
While financial contribution is the most common form of charitable giving, it’s by no means the only kind.
Successful philanthropists frequently contribute their expertise, relationships, leadership skills, professional networks, and personal experiences alongside their financial resources. Business owners often bring decades of strategic thinking, operational experience, and problem-solving capabilities to the causes they support.
"People can affect change through more than just their wealth," Fontaine adds. "They also have social and intellectual capital to bring to the table."
Use Philanthropy To Strengthen Family Purpose
Many families use charitable giving to create conversations around values, stewardship, responsibility, and community impact. With great power comes great responsibility, and these discussions can help younger generations better understand that.
Rather than focusing solely on financial transfers, philanthropy offers opportunities to prepare heirs for future decision-making. "When families engage in philanthropy together, they're often teaching stewardship alongside generosity," Fontaine says.
Some families involve children in researching charitable organizations, evaluating causes, or recommending grant recipients. Others use donor-advised funds or family foundations as educational platforms where younger family members can gain experience making thoughtful decisions about resources and impact.
These conversations can become even more important as families navigate transitions, succession events, or intergenerational wealth planning. The result, hopefully, is a charitable impact that will persist for multiple generations.
Creating A Life Of Consequence
One of the biggest misconceptions in philanthropy is the belief that success requires solving an entire societal problem.
In reality, this takes more money, time, effort, and manpower than can reasonably be expected, which is why meaningful impact often happens on a much more local, tangible scale.
A scholarship may change the trajectory of a student's life. A local program may improve opportunities in a specific neighborhood. A recovery center may provide a path forward for families affected by addiction.
Not every philanthropist will transform or upend a system, but every philanthropist can make a meaningful difference in their community, organization, or in the population they care about. However, the greatest impact only comes with the right mental framing.
Many donors begin their philanthropic journey thinking about legacy. They want to support causes that matter, strengthen the communities around them, and be remembered for the contributions they make.
But Fontaine encourages families to think even bigger.
"Legacy is about being remembered," she says. "Consequence is about solving problems and having a meaningful impact on other people's lives."
That shift from recognition to impact can reshape how donors approach philanthropy, family engagement, and long-term planning. This way, philanthropy becomes more than just an act of generosity – it’s a way to create lasting change of which you and your family can be proud.
