Profit statements

When supporting a nonprofit, how do you review them?

Last month, Riot Games released its 2021 Social Impact Report, which indicates that its social impact fund has, to date, supported more than 400 nonprofit organizations in 25 countries.

The philanthropic fund was originally announced in 2019, building on the work of fundraiser Dawnbringer Karma, which raised $6 million for charities and organizations.

In 2020, $8 million was invested in more than 50 nonprofit organizations in 15 countries. Last year, Riot also said it invested $10,000 in 30 select nonprofits. So how does a program select and vet a nonprofit to support, with the goal of improving systemic issues?

GamesIndustry.biz spoke with Jeffrey Burrell, Senior Director of Riot Games and Executive Director of the Social Impact Fund, about some of the processes involved.

“A lot of people think, ‘Well, how hard is part of the job?'” he says. “Some people just think it’s like, ‘Hey, didn’t you just write a check to a nonprofit?'”

But Burrell says the work is rather complex because there is no shortage of nonprofits. He says some could use “a little water” the fund can offer them.

Riot Games’ Jeffrey Burrell

“We live in a world of unlimited needs, but limited resources,” he adds.

He continues: “What we’re really trying to do is find ways to engage our players and just try to be able to connect some of the hotlines to really create a measurable, tangible and lasting impact.”

These efforts, he notes, can range from supporting international humanitarian efforts, disaster relief and carbon neutrality.

Some of the non-profit organizations supported this year were: América Solidaria Argentina which seeks to end poverty in the country; Cordem ABP, an organization dedicated to gender equality in Mexico; and Plan International Japan, which works to improve the quality of education.

Burrell says the nonprofit support verification, connection, and assessment process approaches the issue from several angles. First, he must assess whether the nonprofit program is a good fit for the fund.

The second approach would be to assess whether the program could benefit from more than money, but also from the visibility and promotion that Riot can offer. An example of this would be creating a partnership model that involves working with Riot’s esports team to create a charity tournament.

“We live in a world of unlimited needs, but limited resources”

Jeffrey Burrel

He also wants to understand the history and trajectory of an organization.

“So, for example, we’ll look at at least three years of audited financials if possible, and we’ll kind of do our own research, saying, ‘Hey, are they negative on a year? ‘” Burrell said.

“Is it because of any particular reason? Is it a trend? How do we view it? We look at the board, we look at the reputation.”

Of course, the Social Impact Fund is also looking for organizations that have the greatest impact. But he notes that impact can be broadly defined, so determining a program’s effectiveness is also imperative. For example, if a nonprofit wants to create a scholarship, Burell will want to understand its “theory of change.”

“[A program] could help 100 students and people can say to me, ‘Oh, I reached 100 students.’ [However] it doesn’t mean that 100 students go on to study computer science at a community college or a four-year institution. »

Assessing a nonprofit also includes understanding whether it can create long-term impact or is in the process of doing so.

The job also includes taking suggestions from players. Burrell admits the social fund could always use help finding more programs, to make sure it casts a wide net.

“Sitting in Los Angeles and looking at the financial statements doesn’t get the comments of the people closest to work…”

Jeffrey Burrel

“Sitting in Los Angeles and looking at financials isn’t getting feedback from the people closest to work to really find an evolutionary impact that might be overlooked,” he notes.

He also explains that seeking help from stakeholders diversifies the portfolio of organizations and ensures that it covers a wider range of topics.

Burrell further explains that the process of vetting and then creating campaigns with organizations can sometimes take up to six months to complete.

There is also a considerable amount of additional work that is required to fund such organizations, so much so that Burrell says, “nobody in social impact functions feels like they have complete control of the situation. “.

One of the challenges of the process that he shared was understanding the different international tax laws.

He summarizes that auditing, supporting, and evaluating nonprofits is an ongoing effort that involves many angles to consider.

“You want to make sure that no matter what happens, the players are looking to be supported, that they’re all above the board, that they’re all vetted and that they have the execution capabilities at the level that we want them to reach.”