1. How the Omidyar Network Pumps Up Nonprofits
By Lisa Katayama
Leaders from the tech and
finance sectors are having an ever greater impact on the nonprofit world. Nowhere is this most
apparent than at the Omidyar Network [1], a philanthropic investment firm started by eBay founder
Pierre Omidyar.
Omidyar Network, or ON, works with a wide range of for-profit and non-profit ventures that they
believe can have a massive social impact—including Digg, Wikia, Kiva, and Creative Commons.
ON provides them all with financial capital and recruiting, governance, and scalability support.
Fast Company spoke to ON managing partner Matt Bannick, Omidyar's right hand man, about the
link between technology and philanthropy, the classifieds market in rural India, and why some
successes can't be measured with metrics.
How did you and Pierre's working relationship evolve from technology to philanthropy?
Pierre and I met in 1999, when I joined eBay. We developed a strong, trusting relationship while
working together at the executive level. Even when I was running eBay International and was post-
acquisition CEO at PayPal, we used to talk about ways in which we can bring some of the

2. underlying promise of eBay—the creation of a platform that presents people with community and
livelihood and creates opportunities for them to do fabulous things--to the developing world.
In 2005, we started a pilot project to figure out how to bring an eBay-like model to rural India.
eBay India already existed, but we wanted to know how to reach people who had less means. For-
profit companies like eBay tend to penetrate countries with more disposable income and Internet
access first. They eventually trickle down to the low per capita GDP countries, but we wanted to
know if there was a way to leapfrog that and create genuine economic opportunity for people in
less fortunate parts of the world using technology.
One thing we noticed was that mobile was the preferred platform. We also learned that there was
already a vibrant classified market in rural India--people would post sheets of paper on a wall at a
central point in a village asking who was available to do x or y, or whether someone had a tractor
for rent. We were inspired and motivated to figure out ways to take the lessons from eBay and
extend them more broadly to the philanthropic sector using technology.
As our relationship evolved, and I became more familiar with what Pierre was doing at ON, we
realized it might make a lot of sense for me to join him. I started working at ON in 2007. Now, I
spend my team working with my team to make sure we're doing what we need to do to help our
investees become successful. I spend a fair amount of time on the road, and Pierre and I catch up on
the phone for about one hour every week.
How important is technology in the organizations in your portfolio?
A lot of the organizations we support have a strong tech background. If you look back historically,
technology is frequently the source of great innovation and great social impact. Entrepreneurs are
all about innovation; innovation frequently comes through technology. For example, we invest in a
company called d.light [2] that provides low-cost solar lanterns, mostly in Africa and India. People
there currently use kerosene--a bad pollutant that is expensive and causes lung problems. d.light is
cheaper, and it enables kids to study—and education, of course, creates a route towards greater
opportunity and prosperity.
There's a core tech element in play that enables us to build a business that creates fabulous
opportunities for individuals. We also recently invested in a non-profit called Refugees United [3],
which is a web-based platform that enables 40 million displaced people to register to find missing
family members. It's hugely innovative, and the fact that we have a tech background holds great
value. We also have some innovative organizations in our group that aren't completely tech-
oriented.
For example, one of our portfolio companies is a for-profit called Bridge International Academies
[4] that provides super low-cost private schools in the slums of Nairobi. Bridge is able to educate a
child on about four dollars a month and is demonstrating fabulous results. They have a whole host
of innovations around teacher training, building new schools, and how content is prepared,
developed, and delivered. They charge tuition, so they're not dependent on the whim or any
particular grant funders, and they've scaled to reach hundreds of thousands of students. It's a very
innovative, cutting edge model.
How do you measure success?
ON is fairly unique in that we have both an LLC and a 501(c)(3)--we can do both for-profit and
non-profit investments. There's flexibility in the financial tools we use to support the organizations
that we believe will have great social impact. Financial returns are an indicator of the degree of
success, but there are other indicators, too. Sustainability is one. We also look at metrics like reach
and engagement: how many people are they affecting, and how deep is that impact? With d.light,
for example, reach would be measured by how many lanterns they sell, and engagement would be
how much they're being used. For Bridge, the number of students is reach, while how much their

3. academic performance has improved is engagement. With Refugees United, reach might be the
number of families reunited, but engagement becomes harder to define.
It's hard to compare metrics across investments when they are
based on values rather than an objective bottom line. How do
you make a qualitative assessment of reuniting a family versus
educating a student? Is it worth educating 20 students? 100?
You've reconnected human beings--I don't know how you even
begin to measure that.
Links:
[1] http://www.omidyar.com/
[2] http://www.dlightdesign.com/home_global.php
[3] https://www.refunite.org/
[4] http://www.bridgeinternationalacademies.com/Bridge/Home.html