Giving Compass’ Take:
• Fast Company details a report from Bridgespan (published originally on Stanford Social Innovation Review) about how billionaires can make more “big bets” in philanthropy and be more effective with their dollars.
• The report emphasizes the need for patience. Most big bettors give an average of four smaller grants to related initiatives before raising the stakes, so it helps to get the lay of the land first.
Philanthropy’s deepest-pocketed donors often short-change the causes they claim to care about the most. That’s because while the majority of the world’s wealthiest givers have expressed interest in solving complex social issues like poverty, educational inequity, environmental degradation, and human rights abuses, only 20% follow through with funding of $10 million or more to actually try to create some fundamental change.
In philanthropic industry parlance, that reluctance even has its own term: “the aspiration gap.” As Bridgespan partner William Foster, whose nonprofit and philanthropist consultancy coined that term, puts it:
The ambition of philanthropists to put “meaningful amounts of money to move meaningful change into the toughest social problem is as present or more present than ever. The difficulty [for most] is figuring out how to do it.” Many donors simply aren’t aware of all the potential social impact strategies they might deploy.
How to effectively make these so-called “big bets” is a question consuming the philanthropic world today.
Philanthropists may have shied away from advocacy efforts in the past because they envision their names associated with hot-button, perhaps intractable issues like gun control. But there plenty of other substantial, less politicized issues where concentrated donations have made major change, including Dallas billionaire Lyda Hill’s work to address the health crisis of antibiotic resistance that has curbed some livestock-raising practices and changed what’s on the menu at restaurants and in grocery stores.
One largely underused tactic that could prove effective would be to create organizational endowments to cause-related organizations, which could then manage the wealth and distribute annual grants at their discretion.
Read the full article about how billionaires can make more of an impact by Ben Paynter at fastcompany.com.
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