With some optimistic assumptions, we can guess that the total addressable market of the progressive tech ecosystem is $6 billion. That makes for a pretty small industry!

It’s limiting in a lot of ways: it tends to depress salaries below market rates; it discourages the use of cutting-edge hardware and software; and it probably limits the scale and breadth of innovation. To put it into some context: GPT-3, one of the most fascinating recent developments in AI, was born out of a $1 billion investment by Microsoft. That’s about 16% of the entire progressive tech ecosystem!

If we’re stuck with a pretty small TAM, can we think about expanding our sector even so? In particular, can we think about expanding the GDP of progressive tech organization?

The difference between TAM and GDP is important. The first concept gets at the total amount of spending by progressive organizations and causes on technology products. That is the $6 billion figure I cited earlier, based on a conjecture about the total amount of money spent in politics in 2020 and the share of that spending which was “tech-enabled” according to Higher Ground Labs. It’s a rough figure but a helpful ballpark.

The second concept, GDP, totals up the value of all goods and services created by progressive tech organizations like NGP VAN, ActBlue, etc. If these organizations restricted themselves only to spending by progressive organizations and causes, then their GDP would be capped by the TAM figure. However, there’s no particular rule that they have to do so! Money earned from corporate clients, government contracts, etc., is not part of the progressive tech market, but it can still contribute to the balance sheet of a progressive tech company.

What I want to do here is to create a kind of living blog post that tries to imagine all of the different ways we can increase the GDP of the progressive tech ecosystem. Some of these ideas are already in practice, but could be adopted more broadly; some of them might be unwise, in practice even if not in theory. I imagine, or certainly hope, that this list will grow!

Catering to organizations outside of politics

Unions

Unions are probably the most obvious clients in this category. They are so well-aligned with progressive causes (in the main) that they might not even be considered “outside” of politics in the first place. Setting aside their expressly political donations and activities, unions’ main “business” is to organize new bargaining units, negotiate contracts for workers, and service existing contracts to the benefit of their members as much as possible. All of these operations fall well within the scope of progressive activism, so they are natural targets for progressive tech. As an added benefit their spending tends to be more even, year-to-year, than that of political entities. In fact they are already a natural source of “off-cycle” employment for many progressive professionals. There is some degree of mission dilution risk here, because unions do occasionally stake out positions which are at odds with those of other progressive organizations - but on the whole it’s a minimal risk, and most progressive tech firms find that they can easily extend into this sector with minimal fuss.

Non-profit organizations

Non-profit organizations are in some cases very well-aligned with progressive organizations. The non-profit sector is huge - it accounts for about $1 trillion dollars of US GDP, meaning that it’s about 20 times bigger than the political sector. As a rule it tends to have a progressive vibe - there are lots of social service and conservation groups - but certainly not uniformly so! There are plenty of apolitical nonprofits, as well as outright conservatively-hued ones, including no small number of religious organizations. All of these are part of that trillion-dollar figure, for instance - so addressing the entire non-profit sector entails risk of mission dilution. Even progressive tech firms which work exclusively with progressively-hued non-profits risk diluting their mission to some degree - non-profits and political entities differ operationally in many ways. One of the best examples of this approach is EveryAction, which began as a progressive tech firm and expanded into the non-profit marketplace. (Disclosure: I used to work at EveryAction.)

Corporate clients

Corporate clients can be well-heeled and afford significantly larger contracts than political entities. Some of them are reasonably well-aligned with progressive values to boot. But here again there is a significant risk of mission dilution: even the best-intended and well-funded corporate clients have timelines, operational models, regulatory and security risks, and other constraints which differ markedly from political entities. Progressive tech firms which serve them are likely to see significant roadmap pressure that distracts from, or even subverts, their progressive mission. Various firms have tried this approach - Hustle, for one, has seen good success here.

Applying non-political tech to politics

The idea here is to take technology which has been developed and funded in a non-political setting, and to bring it to bear for political uses. The benefit to the progressive tech space is that progressive entities take advantage of what amounts to research and development spending by others, and can then apply those savings to other programmatic concerns. The risk is that the technology in question can readily find its way into non-progressive hands. Moreover, there is a risk that progressive clients will simply not be a priority, in terms of customer service, alongside bigger clients. We have seen some of these risks play out already - in some sense this approach describes Facebook advertising products, and indeed we saw Facebook completely shut down political advertising when it posed a headache late last year. A much more encouraging example is the Biden campaign’s use of Greenfly last year.

Increasing the consumer “wallet share” outside of donations

One of the key constraints on progressive tech GDP is that it is funded in large part out of political donations. While there has been significant growth in political donations over the past few decades, this spending remains a tiny fraction of overall consumer spending. If political donations total $50 billion or so, then that amounts to about 0.3% of total consumer spending (which in 2019 was around $14.5 trillion). In other words there are significant opportunities to increase progressive wallet share, and to fund progressive tech through other avenues of consumer spending. The benefits are potentially enormous: there is a huge amount of money that could in principle be brought into the consumer space. The principal risk is simple difficulty of execution: in many cases, it’s not entirely obvious that spending on consumer goods really has, or even should have, any political component. There has been some headway, though. Perhaps the best example of this approach is Credo Mobile, which sells cell phone plans while funding progressive organizations.

Targeting corporate “wallet share”

The idea here is to capture corporate spending on budget items that align with progressive values. There are some obvious candidates in this regard, like initiatives in diversity, equity, and inclusion (DEI), corporate social responsibility (CSR), and environmental sustainability. There is a fair amount of money in this kind of activity - a rough estimate is that corporate spending in these areas totals something like $30-40 billion, roughly equal to the size of the political sector. There is some risk of participating in greenwashing activities, and there are macroeconomic risks as well: some of these budget line items are the first to go in a recession. Still, there is a good deal of promise in this space, and an entire cottage industry underpinning it - it is certainly possible to imagine capturing some of this activity in the GDP of the progressive tech sector.

Leveraging volunteer hours from other sectors

The idea here is to take advantage of resources which are created in other sectors, and to bring them to bear on progressive tech in some fashion. One example of this kind of activity is to work with academic labs in universities and to productize their findings - in this case, the research dollars are provided in part by university spending (which predictably dwarfs political spending, at over half a trillion dollars), thereby reducing risk in the progressive tech sector. Along similar lines, it’s not uncommon to leverage student activism or pro-bono hours donated by progressive lawyers. There is a huge amount of volunteer power available - measured in the billions of hours per year - but it is not always reliable or easy to schedule. So it is difficult to pull off this trick, but when it works at scale it can be very powerful - this approach is basically the founding story for Bluebonnet Data, for example.

Open source

In some ways open source work is a special case of volunteer hours - there are a fair number of software engineers who spend their off-hours on open source hobby projects. Of course, that’s not the whole story: there’s also a great deal of open source work is in fact paid and sponsored by for-profits. That being said, from the point of view of progressive tech GDP, open source is primarily useful as a way of capturing “hobby” hours rather than for-profit in-kind donations. Moreover, open source can in theory be an avenue for capturing skilled contributions from engineers in the for-profit space. It can also serve as a mechanism to fight tech abandonment. That is, the phenomenon whereby progressive entities create some kind of technology in-house, close shop, and never persist the technology outside their walls. To the degree that’s possible, open source can serve as a kind of stop-loss mechanism, where GDP is increased by virtue of value not being destroyed. There is more to be said about open source in the progressive tech space! For the time being, it’s worth noting that while examples are thin on the ground, there are some exciting projects out there - especially Spoke and Parsons.

Investment

Investment dollars are an interesting revenue source. There are in theory quite a lot of them - HSBC estimates something like $5 trillion in shares are traded every day on the New York Stock Exchange. The socially responsible investing (SRI) field is one attempt to bring this cash stream to bear on value-driven initiatives, though it’s not uniformly about progressive values. The DEMZ ETF takes this idea to its logical conclusion and invests in companies whose leadership makes Democratic political donations. But it’s a large cap fund, meaning that its investments don’t flow directly into progressive tech GDP; that is by and large true of other SRI activities as well. Direct investment in progressive tech firms is a tricky business, though Higher Ground Labs and New Media Ventures both seem to be doing a very good job of it. Before this year, exits were relatively rare, meaning that it was difficult to attract investors. That may be changing for the better, with a round of acquisitions this year. Still, as a general rule these kinds of investments are simply not available to retail investors; one can’t readily buy stock in a progressive tech ETF, for instance. On the flip side, investments in progressive tech firms are as a rule private transactions, meaning that fundraising requires a lot of time and effort on the part of founders. For the time being, there remains quite a bit of friction in this avenue.

Green tech

Green tech is a fascinating sector. It’s also a very poorly defined one, potentially including everything from solar panels to organic food distributors. It’s safe to say that it’s pretty lucrative though - direct numbers are hard to come by, but it appears reasonable to estimate the size of the solar industry (which is of course just one part of the larger green tech industry) at around $50-100 billion. Including other renewable energy sources and a few adjacent sectors, it’s reasonable to estimate the size of the green tech sector at a few hundred billion - orders of magnitudes bigger than the entire political sector, and all of it reasonably well-aligned with the progressive agenda! Because of that affinity, it’s somewhat natural to seek to capture a part of this activity in the progressive tech space. But it’s not easy: political organizing and solar energy generation are after all very different activities. (Though there is some overlap - for example lead generation for solar energy bears a lot of resemblance to digital fundraising techniques in politics.) The green tech industry is also somewhat hesitant to dip its toes into political waters. Execution in this space is bound to be difficult, but it carries a lot of promise.

This list is by no means exhaustive, and perhaps even somewhat simplistic. I hope to revisit it from time to time as we unearth more business models that expand out of the traditional constraints imposed by political donations.