Partnership markets

Rhode Island is a small state, but it is rich in various non-profit, academic organizations, government and businesses. The RI Foundation’s Directory lists 2743 non-profits. Very often they overlap in their activities, do not know who does what, and duplicate efforts. There are 35 school districts (about the same number as in Colorado which is three time bigger in population and 67 times bigger in size), and 12 colleges; their issues are the same – transparency, coordination, efficient use of resources. Like in any other state, RI has developed a slew of government agencies that often work in parallel, and trying to help the same populations. One unintended consequence of professionalization is that the different professions become incomprehensible to each other: social workers, teachers, nurses, psychologists, counselors, youth development workers, courts, police and non-profits may be working with the same families with little coordination and little synergy. None of this is bad news. In fact, this speaks of the rich civic tradition and a sophisticated system of social support (by American standards) that exist in RI.

The other side of this richness is that matching needs and coordination of efforts become a special new task, which no one has figured out yet how to do. Just in the last couple of weeks, I was involved in at least three very different conversations which essentially were trying to solve the same problem: how do you match potential partners?

In the mainstream monetized economy, the problem has been mainly solved. With the invention of money – the universal measure of value – and of efficient and regulated markets, people who need something can almost always find people who want to sell it. The progress is far from over, just think how eBay, Amazon, and now price checking apps on your smartphone continue to revolutionize the market of goods and services. But partnerships are different. For example, RIDE wants to put the identified turn-around schools in touch with potential partners. No one has much resource, but they are guessing correctly that more efficient matching between charitable organizations and schools can result in pulling together smaller pools of resources. Use of local groups with volunteer or semi-volunteer labor can be hundreds of times cheaper than using expensive out-of-state consultants. In a similar dilemma, the State needs to match potential providers of professional development with all schools. The Campus Compact is trying to match higher education institutions with community partners. We are constantly solving the problem of matching student teachers with cooperating teachers.

These are just a few examples of inefficient markets, where finding each other is difficult, transparency is hard to achieve, and most importantly, each transaction is not converted first in a common unit of value measurement – money. In a regular market of goods and services each transaction is only half the exchange – you exchange your labor or good for money. It needs the second half – exchange of money for something you want. The splitting of exchange into two makes transactions simpler.

A case of more complicated, non-monetized markets is marriage and/or dating. The matching is based on many criteria, each match is unique, for no too people are the same, and no money change hands. But still for these markets, there are solutions that improve efficiency. Matchmakers are people uniquely knowledgeable of market offerings, and able to make matches better than random. Newer computerized matchmakers like eHarmony.com or okcupid.com solve the same problem by vastly improving transparency, enlarging market place, and creating sophisticated profiles.

So, here is a start-up idea for you, given away for free. Create a virtual space for non-monetary matchmaking outside of dating and marriage games. There will be hundreds of possible applications, one of the most obvious is matching charities and schools with each other, matching volunteers with people in need. If you figure out a way of matching student teachers with cooperating teachers that is better than the existing clumsy system, I will buy it.