Robin Hood’s Venture-Philanthropy Formula Inspires Poverty Fighters Across the U.S.

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Slingshot Memphis Replicates Robin Hood Model and Takes It Further

Justin Miller, CEO/founder, Slingshot Memphis

Justin Miller, CEO/founder, Slingshot Memphis. Photograph by Sarah Cowan.

When Robin Hood was founded over a Chinese dinner in 1987 by top hedge funders--Paul Tudor Jones, Glenn Dubin, Maurice Chessa, Peter Borish--plus David Saltzman, who became co-executive director, the goal was to put the foundation out of business fast by solving poverty in New York City. In addition to idealism and business acumen, the group was driven by a great love of NYC, where they forged their careers and started their families.

More than 30 years later, much poverty has been alleviated through Robin Hood’s strategic formula of powerhouse fundraising.

The Robin Hood formula:

  • 100 percent charity. Because the Robin Hood board covers 100 percent of all administrative costs, every single dollar donated goes to fighting poverty.  
  • Rigorous metrics drive grantmaking. This approach has shown an average 12:1 return on investments: for every dollar spent, living standards for low-income New Yorkers increase by 12 percent. 
  • Accountability. Robin Hood finds, funds, and partners with more than 200 of the most effective programs in NYC.
  • Partnership: In addition to monetary support, Robin Hood offers grantees business expertise, leadership training, and best practices mentoring.

This venture-philanthropy pioneer has since become a model for other groups across the U.S, including A Better Chicago (Chicago), Lever Fund (Washington, DC), Slingshot Memphis (Memphis), and Tipping Point (San Francisco). Many of the founders of these groups once worked for Robin Hood and took the lessons learned to other cities in other states. 

In a recent interview on Bloomberg TV during the 2018 Robin Hood Investors Conference, Wes Moore, Robin Hood CEO, said, “One of the real contributions that Robin Hood has made is understanding how you take investment principles into the philanthropic world. Data matters. Metrics matter." 

About inspiring others, Moore says, “Robin Hood has 30 years experience and learnings fighting poverty with data-driven interventions and proven outcomes. We don't have all the answers and we know that poverty is not a New York issue alone, so we are fortunate to share lessons with, learn from, and move in partnership with impactful organizations across the country that have joined us in this fight.”

In this GrantStation series, we’ll explore how Robin Hood inspired the founding of other poverty-fighting organizations, their impact and accountability in their cities, and how they’ve moved beyond the model. 

Part one of this four-part series focuses on Slingshot Memphis and its founder/CEO, Justin Miller.


"In less than two years, we've put together a stellar board of directors and top consultant staff. We're working with ten organizations in our portfolio, and what's not shown is that we're providing varying levels of consultation to a wide variety of others. We're moving quickly. We've raised $3.5 million in less than two years, and we're just beginning."
Justin Miller, CEO/founder, Slingshot Memphis

MEMPHIS, TENNESSEE IS RENOWNED for the mighty Mississippi River that flows through it, the elevated Chickasaw Bluff (hence the nickname Bluff City), its fraught Civil Rights history, legendary music and musicians, the iconic Beale Street, and its barbecue. While it is touted as the most generous city in America, it also suffers the dubious distinction of leading similar size cities across the country in almost every category of persistent poverty.

It’s complicated.

In this interview, Justin Miller, founder of Slingshot Memphis, discusses how the Robin Hood model inspired Slingshot’s playbook, how it has advanced the model even further, and why even with the most innovative algorithms, things change better when you couch rigor and objectivity in grace and humility.

GrantStation: Tell me about the great need in Memphis.

Justin Miller: We're number one in almost every category of poverty. For example,  Memphis ranks first among 53 MSAs with populations greater than 1,000,000 in child poverty (~76,000 people) and in overall poverty (175,000 people). Memphis was also recently named by the Chronicle of Philanthropy as the most generous city in America. There's just a lot of opportunity for a city that is so broken and a city that is so generous. I firmly believe that Slingshot is positioned to have a profound impact here in Memphis.

GrantStation: What parts of the Robin Hood model have been adopted by Slingshot Memphis?

Justin Miller: I think transparency and monetization are the two biggest aspects that we've embraced. To improve the charitable giving landscape in Memphis, Slingshot aims to recondition the market and to help funders and fighters identify and accelerate the solutions with the greatest return. I'm admittedly biased about this work, but I do feel Memphis is thirsty for a conduit, even if they don't know it yet, a vehicle to put a dollar-weighted value on an outcome and help facilitate more justice for our under-resourced neighbors.

GrantStation: I've heard that you placed significant resources and brainpower behind improving the Robin Hood model and computation on ROI. Can you elaborate on that?

Justin Miller: The foundation of our work is Robin Hood's model and those of the Tipping Point Community in San Francisco, A Better Chicago, and the Lever Fund in Washington, DC, as well as other for-profit, investment models.
                                         
And to belabor the point, our advances are based on what was built before us, so we don't take that for granted. For example, Robin Hood developed 160+ algorithms over the last decade. I don't think people have grasped how important that work is. It's still so new, not just in the U.S. but globally, to put a dollar-weighted value on an outcome. We often don't give it enough time and thought.

That being said, 160+ algorithms can be really overwhelming. So then, some of the advances we've developed at Slingshot aren’t really found elsewhere. Slingshot’s extremely talented staff, guided by our board of directors, has created a universal algorithm that all these other  algorithms, and then many more, fold seamlessly into.

In my opinion, and we beta test this every day, it makes our work more accurate and more scalable. We can serve, in theory, significantly more people through nonprofit organizations and for-profit organizations with this algorithm than if we had so many other frameworks to monetize. It has streamlined our work, yet it still needs some improvement. This algorithm is what we use all day, every day, to create more transparency in Memphis.

GrantStation: This is very exciting. What other Slingshot practices differ from the Robin Hood model?

Warehouse The warehouse at Advance Memphis, one of Slingshot's Investee Partners, where participants receive job training in forklift operation and other logistics tasks.

Justin Miller: One big difference between the Robin Hood algorithms and their approach compared to Slingshot, is that we try to figure out what we call the ecosystem discount in Memphis.

Let me just give you an example. Let's say there's a student who graduates from high school. In Memphis, that student, if he or she is under-resourced, probably leverages about six resources. These might include a few different nonprofit after-school programs. In Memphis, it’s most likely to be a faith-based organization; it's definitely going to be a school. Robin Hood would ultimately give all of those organizations in some way, shape, or form 100% credit of that high school degree.

I believe that if we are not compartmentalizing the value propositions of all these different organizations, Memphis will still be the most generous and the most poor city in ten years. We must figure out a way to properly "credit" the impact of these individual organizations towards that milestone. If we get close to being right about our estimation, it can really inform how we fight, and how we fund.

That, too, is something that this universal algorithm has led us to see, and it’s a vital part of the work in Memphis. The other thing I would say is this: the nonprofit sector in New York City is light years ahead of the nonprofit sector in Memphis in capacity, funding, and bandwidth.

Whereas someone at Robin Hood, or even at Tipping Point in San Francisco, might say, "Hey organization, hey charter school, hey food pantry, hey women and children’s shelter, we need to know this information in this format on these dates." In Memphis, we would get nothing of substance. And that's not a judgment upon the nonprofit sector; it's actually a donor-driven problem

One thing that is really unique, and we pivoted intentionally on this, is that we honestly see our partner organizations as partners. We are quite literally - on a daily basis in some cases - embedded in their work, providing personnel consultation, data technology, and so on, to help unearth information that we all need to serve people better generate more impact.

Why is this important? It sounds like a nuance, but it isn't. What we're really hoping to do is to disrupt the dynamic between donors and nonprofits in our community.

GrantStation: Can you elaborate, please?

Justin Miller: Of course. The funding community often, without even knowing it, creates processes where nonprofits are expected to approach on bended knee and jump through hoops, most of which are meaningless and don't help anyone. In fact, these processes actually create harm, because of the time and resources spent filling out endless grant applications. At Slingshot, we're trying to quantify the impact of some of these organizations so that they can approach funders with courage and confidence and say, "Invest in us, because here is the evidence, period."

Also, we think monetization and transparency will help funders rethink the way they allocate resources, even if they don't give it through Slingshot. I believe we're onto something here, whether it's a faith-based organization, a foundation, a business, an individual, or a family, we can help them recognize that funding the on-the-ground fighters doing good work is the only way we can accomplish our mission in the first place.

When we cut those checks, we literally thank them, which sounds logical, but we don't do it as a society. You ought to see what happens when we do that. We've got to blur the lines between funders and fighters, and I'm naïve enough to think that without monetization and transparency, that's impossible.

But for whatever reason, we turn that mindset off in the charitable giving space. I feel there's so much potential that is quantifiable when we have a more humble posture, when we do this work with rigor and objectivity, and couch it in grace, in humility.

GrantStation: How do you select your partner organizations? Who or what is the ideal partner organization?

Justin Miller: That's another great question. If data in the for-profit sector is scary then data in the nonprofit sector in Memphis is terrifying. And not just to nonprofit organizations but also to funders, right? There are funders who have supported programs for decades who don't want to know that what they funded didn’t achieve the impact they wanted.

A perfect partner has good leadership. It also follows data-informed practices that show the evidence or the potential to generate high-impact solutions for our under-resourced neighbors. Those are some constants. But, equally important, great partners are willing to pivot based on evidence. They can take calculated risks and change things they've done for a long time because it will help more people more effectively.

I know this sounds kind of generic, but somewhere in there is the sweet spot. If I could add in anything, it would be scalability. That's important, and it would be something that might ultimately receive public funding as a means of unlocking local private dollars.

GrantStation: In Memphis, and in any city, it takes courage and stamina to tackle poverty. What are some top challenges or successes for you?

Justin Miller: Successes! Sometimes I get excited and speak as though we've been around a long time. We haven't. I mean, the model itself has been around three decades, although we have only been fully operational since January of 2017.

But we've gotten a tremendous amount of buy-in from a variety of stakeholders: nonprofit organizations, investors, community leaders, etc. In less than two years, we've put together a stellar board of directors and an amazing staff. We're currently working with ten organizations in our portfolio, and what's not shown is that we're providing varying levels of consultation to a wide variety of others. We're moving quickly. We've raised $3.5 million in less than two years, and we're just beginning.

We need that validation to make this work happen. It's validation that people care in Memphis, which is great. The challenges are plenty.  Facilitating this type of change is scary.

Although we are really excited about shedding light on those people, those interventions, those solutions that generate a high return in the fight against poverty, we are simultaneously implicitly or explicitly calling into question others that don't. That can be hard. Change, even good change, is difficult. The Southeast doesn't embrace change. We are ultimately trying to recondition the space in Memphis, and that means influencing both funders and fighters, and that's challenging.

I would argue, and maybe this is too silver lining-ish, that when we get pushback or when we upset people, that, too, is validation.

If everyone were excited about this, we would ultimately be doing something that already exists. I don't want to be different for the sake of being different, I want to be different for the sake of taking a calculated risk to serve more people.

Those are the big challenges: to continue to speak truth in the places that are hard, and also do it as I mentioned earlier, with humility and patience and knowing that this type of work takes a long time.

GrantStation: Another part of the Robin Hood model we haven’t discussed is this: the Robin Hood founders and supporters love New York City, they made their fortunes here, and want to give back for those reasons.  Has Memphis, the city, engendered such devotion?

Justin Miller: Unequivocally, yes. The data speaks to that: most generous city. Just my personal experience, and I share it with so many others, is that this city is both beautiful and broken, I see that a lot. I've had the fortune of  traveling and living all over the world, and I, like many, am drawn to  Memphis. I think one of the reasons we give, and you're alluding to this about New York, is that this city has given so much. It's rich in history  and in diversity. It's unique. You can't replicate it. You just can't.

The opportunity lies in how we capitalize on this generosity in such a  way that we can accelerate change. Just touting the “most generous city” statistic can be dangerous for two reasons: on one hand it can suggest, “Oh, well, we're the most generous, why do I need to get involved?” It’s also dangerous when we say, "Look, we are the most generous, but we're the most poor." Sometimes people respond with, "It won't work."

It's upon us at Slingshot, and on other people here in Memphis, to pivot toward hard evidence. We must still tell the stories, the narrative, but we must provide the proof points in data. We’re using data day in and day out, and people are thinking differently about the work.  

Justin Miller, CEO/Founder

Justin founded Slingshot Memphis in 2016 and currently serves as its CEO. Prior to launching Slingshot Memphis, Justin worked as a Giving Strategist for City Leadership, where he helped individuals, families, and businesses develop, target, and maximize charitable investments. Preceding his work at City Leadership, Justin was a member of the Fixed Income Division at Morgan Keegan/Raymond James. Servicing financial institutions and municipalities, Justin specialized in developing portfolio strategies and executing trades in fixed income securities. Earlier in his career, Justin was an educator at St. George’s Independent School, where he served as Dean of Students, Associate Director of Counseling, Teacher, Coach, and Chaplain. Justin holds a Master of Divinity from Emory University and a Bachelor of Arts in History from the University of Memphis.