Giving Compass' Take:
- The Cooperative Economics Alliance of NYC shares what they accomplished and what they learned from an innovative grantmaking project in New York City.
- What is the value of experimenting with alternative funding systems for co-ops, community projects, and other local initiatives? How can traditional philanthropy support giving and grantmaking at a hyperlocal scale?
- Read about the growth of worker co-ops.
What is Giving Compass?
We connect donors to learning resources and ways to support community-led solutions. Learn more about us.
All living beings grow, shift and evolve, and we change by doing. For those of us bent on social change, we are always experimenting, learning as we go, changing ourselves and each other even as we struggle to change our conditions. While traditional philanthropy and Western institutions value linear stories of cause and effect, that often isn’t the most useful lens for our social change experiments, which operate outside a scientific lab and interact with unknown variables. Instead we want to offer to you our observations of what we thought would happen, what we know happened, and what we learned from that, as well as what we don’t know. Many of the patterns, structures, and challenges we faced in the Solidarity Economy Giving Project will be familiar to community and solidarity economy organizers, as well as our allies in radical philanthropy. Here are five lessons we've learned from the work we've done:
MANAGING SYSTEMIC OPPRESSION: We understood that we would face structural barriers to grantmaking to solidarity economy groups, given that most nonprofits, their lawyers, and the IRS do not understand the solidarity economy landscape. Navigating IRS requirements for charitable giving by nonprofits required progressive co-op attorneys who could vet the grant recommendations and provide legal memos to our fiscal sponsor that explained how each grant fit IRS requirements. There is a real need for this kind of expertise, and it is far outside what is taught in most law schools.
MANAGING MONEY: The owning class hoards wealth in a complex array of funds and investment vehicles. We understood that in order to work with wealthy people to redistribute their wealth we needed to have as much flexibility as possible in how we could accept and direct their donations. We wanted a credible vendor who could handle the complexities of money manager inquiries and requests, who could accept donations of stocks, as well as grants from family foundations, donor advised funds, and donations from family funds controlled by a money manager. Our fiscal sponsor could not handle those requests, so we sought out a values-aligned donor advised fund. Finding a donor advised fund that would work with us to support solidarity economy work was a challenge, but finding one that would work with a fund that expected to top out at $50,000 annually was even more difficult.
MANAGING DATA: Foundations have sophisticated databases designed for grantmaking that track legal documents and requirements. We had Google Sheets and CiviCRM and a mostly volunteer team along with a couple of part-time staff members who had several other areas of responsibility. We recommend having a solid and navigable data system in place before you start any grantmaking. Adding grantmaking to program and administrative staff’s workload meant they had less time to devote to programs, our own fundraising, organizing, membership, communications, training, etc. Role division within our movements can be a good thing, provided that philanthropy is driven from the bottom up and is formed by communities in partnership with foundations.
MANAGING RELATIONSHIPS: While the program provided support to grantees and covered its own costs, fundraising was a challenge. We relied heavily on existing networks and relationships, and we did not quite achieve the deep level of community building and relationality we hoped for and intended. Part of this was because the grantmaking took so much time and attention that the fundraising and donor community was always getting about half of what it needed, and that resulted in a feeling of disconnection. Prior to recent surges in giving circle platforms, most giving projects were held within foundations and coordinated by a full-time staff with benefits and security. We operated in a much more precarious way, without that level of support, and while our program was strong in its content and presentation, that difference in foundational support was felt.
MANAGING TIME: We seriously underestimated the amount of time it would take to fundraise, deal with bureaucracy, and move money. The program was also intended to be resourcing, but over time we found that while we were resourcing our communities, we were sacrificing on other programs and necessary operations. With only part-time staff and volunteers, we found we just could not do it all, and ultimately this was a significant part of our decision to wind down the SEGP Giving Circle (fundraising) and grantmaking. When possible, we do expect to continue to make grants and move money, because there is such a dire need, but that fundraising must not come at the expense of the organization.
Read the full report about the Solidarity Economy Giving Project by Cooperative Economics Alliance of NYC on Medium.