Dan Pallotta on Innovation & the Social Profit Sector

It’s kind of a big deal when you get to meet your professional hero. The proverbial ‘they’ say that you should never meet your heroes, that they often disappoint, but last week when I met Dan Pallotta, there was no disappointment to be had.

For those of you who don’t know who he is, Dan is the visionary behind the TED Talk The Way in Which We Think About Charity is Dead Wrong, which has amassed over 3.6 million views to date. If you haven’t seen it yet, scroll down and watch it at the end of this post. He talks about the two different rule books: one for charities and one for businesses. His book, Uncharitable, is the more detailed version of this TED Talk, showing how we’ve been trained as a society and as donors, to think of charity in a certain way, a way which actually debilitates most nonprofits from achieving the kind of scale that we’re more than comfortable with in the for-profit world.

dan pallotta

One of the issues that he tackles is overhead.

I remember clearly in 2006, when I chose to walk in the 2-day Breast Cancer walk in Edmonton, that a good, smart friend of mine told me she wouldn’t donate to my walk. It has nothing to do with you, she’d said, but that she couldn’t support an organization that spent 30-40% on overhead. The cost of the tents, the food, the supplies, the sound system, etc. The two day walks are costly events. I understood and left it at that.

I wish I’d had then the information that I have now.

Dan has done a lot of great work to change the conversation. Instead of looking at the inputs, let’s look at the outcomes. Does it matter how much we invest, percentage-wise, if the outcome is raising significantly more dollars for the charity or if the social issue is being resolved? I don’t believe so. Why are we okay with McDonalds or Apple or video game companies spending billions of dollars on advertising, yet we have a gut-wrenching reaction to a nonprofit trying to fundraise in the same manor?

But… I’m getting off topic. Today’s post isn’t about Dan’s TED Talk, though I encourage you to watch it. Today’s post is about innovation.

dan pallotta

Yes… I got my book signed!

I had the pleasure of hearing Dan speak twice last week. At the Vital City 2015 event, Dan talked about the four key elements needed for innovation. Here were my main takeaways.


We all talk about finding our purpose, and I’ve always equated that to a warm, fuzzy feeling down the road. When I find my purpose, I’ll feel complete. I’ll have a clear path, a vision, right?

As Pallotta said, purpose often comes from being frustrated enough with something that you work and put your energy into it to resolve the issue. As my friend at the United Way says, life is not about finding yourself, it’s about creating yourself. Both of these are true.


Pallotta spoke a lot about hating the phrase “think outside the box”. As he noted, most people don’t take the time to actually figure out their box in the first place. If we don’t know what we’re working with, how can we innovate it? How can we make advances, if we’re often so blinded by it to think differently?


Pallotta talked about how every idea will have its time come. You might have to work very hard, for a number of years, before your idea will really flourish into what you’d hoped for. You might be one of those lucky people whose idea is needed now, or your time might not come for a while. You need to be patient.


What are you willing to commit to, to give up or to change in order to innovate, asked Pallotta. We often think that if an idea is great, that everything will fall into place. Not so. Pallotta once had to personally put his home and personal savings on the line to try a new, innovative venture. Did he have the courage (and an understanding family!) to do so? Yes. Were there plenty of naysayers? Absolutely.

My favourite quote of the night was when Dan advised us to “avoid practicality. There are plenty of others devoted to the practical.”

I’m hardly doing the man justice, but I hope at the least I’ve inspired you to check out his incredible TED talk.

Whether your innovation is in the social profit sector, in the for profit sector, or in a creative endeavour, there’s much that can be learned from Dan Pallotta.

What are your thoughts on innovation? What elements need to be in place, or what traits do you need to possess?


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