Giving Compass' Take:

• Ariella Saperstein explores some lessons from grantmaking practices that fell flat, notably the importance of listening to constituents and the need to clearly state goals.

• There can be upsides to failure — and we can always learn from our mistakes if we're willing to keep an open mind. Which of these lessons might apply to your philanthropic efforts?

• Learn about "good failures" in philanthropy.

As philanthropy in the United States continues to grow, so does the involvement of professionally staffed foundations. In 2016, Giving USA estimated that $390 billion was given to charitable causes, with foundation donations making up 15% ($59.28 billion) of this total. While private philanthropy has been responsible for phenomenal successes, it has also produced significant failures. A 2013 study by the Center for Effective Philanthropy found that 88% of nonprofit leaders want foundations to speak more publicly about such failures.

In a series of interviews with senior foundation professionals in the Jewish world, I discussed the factors on the foundation side that led to a grant’s failure to achieve its projected outcomes. Thirteen foundation professionals agreed to be interviewed, though more than half requested anonymity. In the interest of communicating the lessons funders can use to improve their grantmaking practices, below are some of the learnings shared by staff from their experiences. It will be noted that none of the lessons cited were particular to the Jewish aspect of the foundations’ grantmaking, but were rather more broadly applicable to philanthropy in general.

1. Know your market, your audience, and your grantee. Starting something new brings excitement and enthusiasm that should be shared by funder and grantee. However, these emotions can be tempered with data, market studies, needs assessments, and other relevant research needed to test the feasibility of an idea. Listening and adapting to the results can mean the difference between failure and success.

2. Conversations with all relevant staff who will be part of the grant’s execution are critical. Failing to involve key staff leaves a funder vulnerable to not understanding the full picture of what is involved to achieve necessary goals, and foregoes a relationship with the individual(s) most integral to making the project a success.

3. Clarity from the outset about measurable goals and expectations is important for both funders and grantees. Although this lesson may appear obvious, every project does not lend itself easily to metrics and specific outcomes, and funders must challenge themselves to identify the milestones and results that will make a project a success in an appropriate timeframe.

Of course, not every failure is an instructive one, but it is the responsibility of foundation professionals to look for the constructive lessons, as revealed by careful evaluation, and share the results. As UPenn Professor Peter Frumkin writes, “the costs of failing to document, communicate, and appreciate failed grants will surely prove more costly in the long run than any grantmaker now neglecting this task can possibly foresee.”

Read the full article about lessons learned from philanthropic failures by Ariella Saperstein at eJewish Philanthropy.