Caren DeWitt is a high-tech entrepreneur with a social conscience. In the past, the co-founder of webMethods has painted her share of low-income housing and ladled broth at soup kitchens. Now, she wants to carry that hands-on experience through with her Fairfax software firm, so it can serve its community in meaningful ways that go beyond just writing checks.

After meeting with Northern Virginia high-tech maven Mario Morino, who coined the term, "venture philanthropy," DeWitt embraced the idea with a passion. "The heart and soul of venture philanthropy is that you take what you’ve learned and your experiences, pick the best of all of that and apply it to social problems," says DeWitt. Then awash in cash, webMethods last year set up a $25 million foundation to aid nonprofit social groups, thus giving employees a conduit for volunteering their time. The foundation’s first investment is to Venture Philanthropy Partners, a $32 million fund established through the Morino Institute to put venture philanthropy to work on education-oriented nonprofits for low-income children.

Many in high technology see themselves as the Brave New World of charity. They intend to rewrite the rules of giving and vastly improve social services by taking a much more proactive role in philanthropy. A major question, however, is how high-tech firms can proceed with their plans, most of which are still on the drawing boards. In Northern Virginia, the high-tech capital of Virginia, many firms have been badly hurt by the stock market crash. Most still have yet to make money or have only a fraction of the cash they had a year ago (Page 8). Some are in danger of going belly up.

In principle, however, venture philanthropy could offer traditional charity fresh competition and a new benchmark. Like other high-tech moguls, DeWitt sees the concept as a way to do good in better ways. Rather than going through traditional outfits such as the United Way that parse out contributions on a year-to-year basis, the new philanthropy could give beneficiaries more financial staying power. Company employees could really get their feet wet by offering their skills directly to help out. Combining the two, nonprofits could benefit from better funding, planning, and execution. "It’s more than just giving money," says Gary Jonas, managing partner of Venture Philanthropy Partners, which will make its first "investments" this year. Venture Philanthropy Partner’s some 30 investors include Morino and webMethods, plus local venture capitalists, a string of AOL Time Warner executives, Proxicom founder Raul Fernandez, and gubernatorial candidate Mark Warner.

The group’s first real test is assisting both non-profit and for-profit groups, in the Washington, D.C., area. In suburban Maryland, the Jewish Venture Philanthropy Fund provides seed money for groups like Jewish Social Service Agency’s home health care program — money that helped the agency leverage more contributions from foundations. "They gave us venture capital. They didn’t want to fund ongoing services but something new and different," says Joanne Nattrass, the agency’s chief operating officer.

Moreover, the Northern Virginia Technology Council is launching a new foundation to combine traditional giving and venture projects, a logical step after tech companies and employees helped wire and run computers at the Gum Springs Community Center in Alexandria. Local executives who provided financial help also wanted to debate some of the project’s smallest details, like what kind of software was installed on the computers. "It’s in their character to operate that way," says NVTC’s Tim Nurvala, who will run the foundation. "We’ll get our hands dirty and get involved in organizations."

Even so, traditional philanthropists bristle at the attention heaped on the tech upstarts. "Just because they succeeded in the for-profit sector doesn’t necessarily mean those skills work for entrenched social problems," says Rick Cohen, president of the National Committee for Responsive Philanthropy. He wonders if the high-tech workers have the stomach for the tough, often thankless work older charities provide for the down-and-outs, such as sheltering the homeless and feeding the hungry.

Even backers of the new involvement of the New Economy, such as Neil Carlson, editor of Responsive Philanthropy magazine, want to see venture philanthropists test their concepts on hard-core social problems like illiteracy, poverty, and the alienation of urban youth. And, for all the talk, venture philanthropy hasn’t attracted serious money. The total capital for the 37 funds surveyed by the Morino Institute outside of Virginia equaled what one good-sized foundation gives away in a year.