Innovations in Philanthropy: Paying it Forward with Thriive

One of the highlights of my recent trip to Vietnam was seeing innovative philanthropy in action.  US-based nonprofit Thriive is creating win-win-win situations all around with its pay-it-forward grassroots philanthropy model.  Thriive pioneers a model that democratizes philanthropy, a concept that many of us think is only for the likes of Bill Gates and Warren Buffet, especially in these difficult economic times.

Thriive takes everyday people, all of them small business owners in developing countries, and transforms them into local community heroes.  

So how does Thriive work?  It gives equipment capital loans to small business owners.  When it’s time to repay the loan, the loan borrowers repay it forward in the form of goods and services they provide to their community.  When applying for the loan, the borrowers must already have a clear ‘repayment’ plan that details the social needs in the community that its ‘repayment’ will help address.  

What’s brilliant about the model is that the borrowers usually create jobs in their sector, and often train young people to set up their own businesses in the same sector.  It may seem like potential competition but in fact they are merely expanding their supply chain.  

One savvy mushroom farmer borrowed money to expand her mushroom farm and train other women to grow mushrooms that she commits to buying because she is unable to meet the current demand for mushrooms on her own.

So far, all Thriive borrowers have continued giving to their communities even after their loans have been repaid.  In Vietnam, Thriive borrowers join the Thriive Business Association where the borrowers connect with one another and develop ways to support each others’ businesses and the community through a service or product barter system.  For example, a carpenter helped a small incense shop install a wooden door that it had not been able to afford. 

The Thriive model makes a great deal of economic sense.  These businesses need capital to grow their businesses and once they do, they can create economic value by creating more jobs in the community.

 Thriive offers a non-interest bearing loan that is more attractive than regular commercial loans.  But Thriive is also creating an equally important kind of value – social value in the form of creating or strengthening closer and tighter caring community bonds. This is what ultimately leads to supportive and resilient social infrastructure in times of crisis.  

The Thriive Hue team has already shown its savvy understanding of this concept by linking all the Thriive businesses to the local disaster response organization in Central Vietnam, a part of the country that is prone to destructive flooding.  All Thriive borrowers commit to providing certain supplies in case of flooding emergencies.  

It was great to see the links between the entrepreneur-philanthropists and the community.  Prior to my visit, I had thought Thriive helped to 'seed' philanthropy in low-income communities. But after meeting the Thriive borrowers and learning about their many philanthropic activities prior to Thriive, I realized that in most cases, Thriive helped to formalize, nurture and grow existing small-scale community-building initiatives.  

Some of the Thriive borrowers may have already been low-key community do-gooders but the Thriive model shines light on their good deeds and provides additional resources to ramp up their community building activities.  

During my visit, I was fortunate to be able to participate in a Thriive repayment ceremony.  Two Thriive borrowers, both tailors, gave custom-made pajamas and school clothes for abandoned elderly and children with special needs respectively. There were smiles, tears and hugs all around.