The challenges that nonprofits take on — hunger, disease, climate change, armed conflict, racial injustice, gender inequality, and human rights abuses, to list just a few — are amongst the toughest that societies face. The odds often seem insurmountable, particularly when you compare the scale of the challenge to the resources at hand.

At the Freedom Fund, a nine-year-old global fund that aims to end modern slavery, one could argue that our ambition far outweighs our budget of $27 million and staff of under 100. We’re trying to tackle a severe violation of human rights that afflicts an estimated 50 million people globally and generates hundreds of billions in illicit profits every year. In order to make progress, we’ve had to think differently about achieving scale.

In the early days, I spent a great deal of my time pitching potential donors on the concept of the Freedom Fund and asking them for the initial investments that would allow us to move from an idea to an organization. I shared our mission to tackle slavery and the way we planned to achieve it: raising philanthropic capital, investing it in concentrated clusters of grassroots organizations, working with partners to both prevent and tackle modern slavery, and generating data and evidence about what works best to reduce its prevalence.

Many donors rightly jumped right to asking about scale. They wanted to know how we could possibly have a measurable impact given that tens of millions of people were victims of extreme exploitation. Some presumed that our goal, were we to be effective, would be to fund as many organizations in as many corners of the world as possible. Others, especially those with a finance industry mindset, insisted the greatest impact would come from finding a small number of high-performing organizations and funding them to scale massively. They were not necessarily sold on our approach of long-term, steady investment and close accompaniment of clusters of small, locally-led groups. “I don’t think your model will work,” one hedge fund billionaire told me point-blank over dinner. But we must have done something right, because enough of these philanthropists, the hedge fund billionaire among them, were willing to swallow their skepticism enough to write multi-million-dollar checks.

Much of the discussion on scale in the nonprofit sector is not fit for purpose because it is transposed from the business world. For an ambitious corporation, the primary objective is to maximize financial returns — if there are other objectives, they come second. In most cases, the goal is to grow massively, dominating the sector to grow earnings while reducing marginal costs. In contrast, a nonprofit’s overall objective should be to maximize impact in pursuit of purpose. Growing the organization massively is not necessarily the best way to do this. In fact, it can be counterproductive, because unlike businesses, nonprofits don’t earn income — rather they have to persuade donors to give it to them. And the marginal costs of fundraising grow as nonprofits get bigger, meaning that a greater percentage of their income is spent on fundraising, reducing the percentage available for their programmatic work. It’s quite difficult and uncommon for nonprofits to grow massively AND efficiently, and when they do, they often aren’t sustainable in the long-term.

So the focus should be on scaling impact. There are two powerful ways nonprofits can do this. The first is by enlisting others to their cause, and the second is by changing systems. The odds are even better if you can bring both approaches together, which is what we strive to do at the Freedom Fund.

Read the full article about thinking differently about scale by Nick Grono at The Center for Effective Philanthropy.