It’s no secret that a passion for philanthropy runs in the Arrillaga family.

Laura Arrillaga, 36, a Graduate School of Business (GSB) lecturer whose family’s contributions to campus include several buildings, is making headlines of her own for efforts to effect change in the nonprofit sector.

Arrillaga founded the Silicon Valley Social Venture Fund (SV2) in 1998 in order to help Silicon Valley entrepreneurs pool resources, as well as to work with local non-profits to improve their organizational effectiveness. SV2 typically attracts young professionals without a legacy in philanthropy to guide the professionals’ investments by offering educational programs in effective personal giving and assuring investors of a high accountability level in results.

Arrillaga came up with the idea for the venture fund after completing the MBA program at the GSB in 1997. In the Silicon Valley area, she encountered a large number of successful 30 to 40 year-old locals, who expressed a desire to use their wealth to serve the greater good, but were not already engaged in philanthropy.

“The vast majority of those... able to give weren’t from Silicon Valley, so they didn’t have ties to charitable organizations [in the area],” she said on the SV2 Web site. However, “their professional experiences,” Arrillaga noted, “provided them with an understanding of the need for a high level of accountability alongside philanthropic investments.”

She believed their skills would make them effective investors in the non-profit sector, if given the right guidance.

With this unique pool of investors in mind, Arrillaga devised the SV2 fund. SV2 donors select non-profit organizations of interest and use a grant-making model based on “multi-year, mutually accountable grants” to help these non-profits achieve results. All the while, the fund teaches the skills and knowledge necessary for being an effective philanthropist.

The grants have been extremely successful over the last ten years. Investors are currently focused on improving the organizational capacity of a number of local non-profits, including Fresh Lifelines for Youth, a center for at-risk youth in San Jose, and Acterra, an environmental sustainability group based in Palo Alto, among others. “[There is] a documented, measurable impact on our grantees’ effectiveness and efficiency as organizations,” Arrillaga said on the Web site. .

She plans to continue improving on SV2’s grant-making model through “increased partner engagement, focused issue areas and interaction.”

“We are approaching our ten year anniversary in 19 months and we have tremendous plans for increased growth, impact and sustainability....developing right now. I could not be more excited for the future,” she said.

Arrillaga also encouraged Stanford students to become involved in SV2’s work.

“We have a Stanford undergraduate summer fellowship each year, and undergraduates working for our staff,” she said. “We might even create a post-graduate fellowship in the coming year or two.”

Arrillaga plans to offer a class in the spring on philanthropy and social innovation.