Every so often, especially if I feel poor, I pop into the store and buy a lottery ticket. They sell dreams, these lotteries – dreams of how I, too, can become a millionaire and leave all my money worries behind. You, too?

Well, now I am wishing I lived in the Netherlands, because it has quite a different kind of lottery. The Dutch Postcode Lottery is the ‘win-win’ kind.

“People play the lottery with a lottery ticket based on their postcode. So winners of the Postcode Street Prize or ‘PostcodeKanjer’ are usually neighbours. This is what makes playing Nationale Postcode Loterij so unique: all players in a street of neighbourhood win together.”

If you buy a ticket, of course – because if you didn’t, and your neighbourhood wins, you will be out of luck. Sort of the reverse of how most of North America does it.

More than 10 million players win prizes each year, and the weekly PostcodeStreetprize, in which a whole street stands to win a spectacular cash award, is well known throughout the Netherlands. The highlight is the PostcodeKanjer, given out on the first day of each year. On January 1, 2022, the PostcodeKanjer will be € 56.7 million – the highest ever.

But it is not only a street that wins – so do the 121 charities that the lottery supports. At least 50% of each ticket goes to charity (35% goes to the winners, and 15% covers organizational costs.) Charities got 347 million euros in 2021.

Since it started in 1989, the lottery has contributed over 6.2 billion Euros to charity organisations, providing long-term institutional support to organisations worldwide working in the areas of poverty alleviation, human rights, nature conservation, the environment and social cohesion in the Netherlands.

The kind of flexible, unrestricted, multi-year support it provides is rare in the philanthropic world. Organizations supported by the lotteries can spend the funding as they wish for five years. After those five years, organizations can apply to have support renewed.

“We’re not the experts in the field; the nonprofits are,” Margriet Schreuders, head of the charity department, explained to an American who was curious about the model. “We believe that civil society organizations are engines for change and provide innovative ways to better the world overall. We want to promote system change, and we believe that by providing flexible, multi-year funding, we’re able to assist these organizations in doing just that.”

Schreuders identified four attributes it strives for: trust, modesty, curiosity, and courageousness. “Our goal is to give the power to the partners we work with. We hope to stimulate innovation, entrepreneurship, and impact and help make powerful change.”

This was an intentional choice by the founders, who had worked in the fields of fundraising, publicity and member recruitment and wanted to make the world a better place. That led them to invent a lottery format that not only focused on sharing the revenue but also on winning together. Founders Boudewijn Poelmann, Frank Leeman, Herman de Jong and Simon Jelsma – the former shareholders in Novamedia – had such faith in the new format that they took the financial risk.

“What seems obvious now was far from so at the time,” says the history of the lottery. “When the lottery was set up, there was a great deal of skepticism and nobody, including the charities, dared to co-finance the initiative.”

The Goede Doelen Loterijen, the umbrella organization, is the third-largest private donor to charitable causes in the world. Only the Bill & Melinda Gates Foundation (U.S.) and the Wellcome Trust (U.K.) give more – and that is amazing for a country that has a population of 17 million, ranking 66th out of over 200 other countries and islands around the world.

The formula has spread, and since 2005, there are postcode lotteries in the United Kingdom, Sweden, Germany, and Norway (the People’s Postcode Lottery, the Svenska PostkodLotteriet, the Deutsche Postcode Lotterie, and the Norsk Postkodelotteri). Novamedia carried the risks and expenses associated with getting the new Postcode Lotteries off the ground. Since 2017 all the shares of Novamedia, and the lotteries, are in the hands of a general interest foundation: the Novamedia Foundation Trust, which protects the sale of Novamedia and the intellectual property rights related to the Postcode Lottery format.

Since the beginning, Novamedia says, the lotteries have donated 11 billion euros to thousands of charities all over the world.

Sources:

Nationale Postcode Loterij website.

We’re supported by the Dutch Postcode Lottery. Prince Claus Fund.

The Dutch Charity Lotteries and an innovative approach to change. Lilly Family School of Philanthropy, Jun. 17, 2019.