Google's For-Profit Philantrophy!

The founders of Google, have set up a philanthropy, giving it seed money of about $1 billion and a mandate to tackle poverty, disease and global warming. But this is like no other philantropic ventures that we have seen. Not the mandate, but the scale and the way it will be operated. This will be a for-profit, tax paying organisation.

But unlike most charities, this one will be for-profit, allowing it to fund
start-up companies, form partnerships with venture capitalists and even lobby
Congress. It will also pay taxes. One of its maiden projects reflects the philanthropy’s nontraditional approach. According to people briefed on the program, the organization, called Google.org, plans to develop an ultra-fuel-efficient plug-in hybrid car engine that runs on ethanol, electricity and gasoline. The philanthropy is consulting with hybrid-engine scientists and automakers, and has arranged for the purchase of a small fleet of cars with plans to convert the engines so that
their gas mileage exceeds 100 miles per gallon. The goal of the project is to reduce dependence on oil while alleviating the effects of global warming.

Did I mention incentive? The urge and the drive to make is difference is a very good incentive, and it keeps many NGO's go, but such successes are usually driven by a one or two men(women included) self driven heroes. But at a scale such as this, monetary incentive becomes the best incentive to make it a success. Hats off to google.

1 Billion may not as massive as the Bill-melinda foundation's or Warren Buffet's funds, but it sure is big enough money, and it is different.

Google.org is drawing skeptics for both its structure and its ambitions. It is a slingshot compared with the artillery of charities established by older captains of industry. Its financing pales next to the tens of billions that the Bill and Melinda Gates Foundation will have at its disposal, especially with the coming infusion of some $3 billion a year from Warren E. Buffett, the founder of Berkshire Hathaway.
But Google’s philanthropic work is coming early in the company’s lifetime. Microsoft was 25 years old before Bill Gates set up his foundation, which is a tax-exempt organization and separate from Microsoft.

By choosing for-profit status, Google will have to pay taxes if company shares are sold at a profit — or if corporate earnings are used — to finance Google.org. Any resulting venture that shows a profit will also have to pay taxes. Shareholders may not like the fact that the Google.org tax forms will not be made public, but kept private as part of the tax filings of the parent, Google Inc.
Google’s founders, Larry Page and Sergey Brin, believe for-profit status will greatly increase their philanthropy’s range and flexibility. It could, for example, form a company to sell the converted cars, finance that company in partnership with venture capitalists, and even hire a lobbyist to pressure Congress to pass legislation granting a tax credit to consumers who buy the cars.

Talking about different, the person whom Page and Brin have hired to run google.org is also quite a character.

The executive director whom Mr. Page and Mr. Brin have hired, Dr. Larry Brilliant, is every bit as iconoclastic as Google’s philanthropic arm. Dr. Brilliant, a 61-year-old physician and public health expert, has studied under a Hindu guru in a monastery at the foothills of the Himalayas and worked as a Silicon Valley entrepreneur.
In one project, which Dr. Brilliant brought with him to the job, Google.org will try to develop a system to detect disease outbreaks early.
Dr. Brilliant likens the traditional structure of corporate foundations to a musician confined to playing only the high register on a piano. “Google.org can play on the entire keyboard,” Dr. Brilliant said in an interview. “It can start companies, build industries, pay consultants, lobby, give money to individuals and make a profit.”

While declining to comment on the car project specifically, Dr. Brilliant said he would hope to see such ventures make a profit. “But if they didn’t, we wouldn’t care,” he said. “We’re not doing it for the profit. And if we didn’t get our capital back, so what? The emphasis is on social returns, not economic returns.”

Dr. Brilliant said he had no desire to “reinvent the wheel” by working on projects others are already involved in. And although Google is a high-tech company, that does not mean that Google.org will be throwing around high-tech solutions.
“Why would we put Wi-Fi in a place where what they need is food and clean water?” he said.[Source Login ID required]