Giving Compass' Take:

· Philanthropy is always growing, and so are the tools it uses. Today, philanthropists are able to use instruments from the corporate world to tackle relevant issues like public health concerns, poverty, and natural disasters. 

· While some of the information in this piece may already be known to seasoned impact investors, it's always good to take a step back and get an overview of the industry to see the true potential.

· Here you can read more about social impact business models.

Many are aware of the different forms of charity-giving. But sometimes we can't distinguish between charity-giving and philanthropy.

Have you heard of impact investment, venture philanthropy, strategic philanthropy or social enterprises? These are the new generations of philanthropy that have used successful business models to address global challenges like poverty, health issues, natural disasters and ageing.

Charity-giving is usually more spontaneous and reactive to an event, such as raising money for earthquake victims, while philanthropy is purpose-driven, usually by values and passion, and involves a higher degree of commitment.

In a new frontier of philanthropy, there's impact investment, where a philanthropist actively pumps in capital into investment or business to generate income, and the returns are given to charity. Impact investment requires risk-taking, strategy, determination, humility and passion.

There's also venture philanthropy — it emphasizes capacity-building in an organization and the grants given to non-profit organizations as a form of investment.

Read the full article about business models in philanthropy by Serena Sim at The Business Times.