Note from Beth: I’m hosting a small army of guest bloggers, grantmakers, who are attending the GeoFunders National Conference taking place this week in Seattle. The GEO community is united by a common drive to challenge the norm in pursuit of better results. GEO’s 2012 National Conference shares a range of perspectives and new ideas for smarter grantmaking that leads to better results and presents opportunities for participants to learn from the wisdom and experience of their peers. If you’re not attending and curious what funders are learning, you’ll have an opportunity to read some of the ideas and questions being discussed right here on this blog.
Doing More by Doing Less – guest post by David Greco
There have been a lot of conversations about what funders can do to support nonprofits to scale impact. But one of the more interesting areas brought to the forefront here at the GEO conference is what can funders stop doing, what bad “best” practices need to be abandoned, and how can funders get out of their own way. It is refreshing to hear the conversation about ‘how not to grant’.
Thanks in large part to recent research by GEO and others, funders now see that to achieve the impact they want to see, they are adapting practices that nonprofits have been asking for, for years – GOS, multi-year funding, and capacity building.
But I think what has really driven this is the continued impact of the prolonged economic instability. Given the massive cuts we are seeing across the sector, there is no way that private philanthropy can respond on a dollar for dollar basis. We could empty the coffers of all the foundations in the United States but still couldn’t offset the cuts from the federal government alone. So funders are realizing they need to give smarter, to be more efficient, and to better align funder dollars with the business and mission needs of nonprofits.
There have been a number of efforts at doing new things like PRIs, MRIs, Impact Investing, and launching new initiatives. But what is really fascinating is that there has been a realization that there were a number of bad best practices that if funders could simply abandon, it would result in increased impact and better outcomes. Some funders and donors started to ask how much of the sector’s perceived inability to achieve scale or impact is due to funders believing it is about them – their theory of change, their strategy, and their definition (and measurement) of outcomes? These funders then created a new definition of doing more with less. Less restrictive funding. Less onerous reporting requirements. Less ‘we know better’ attitudes.
Why this is so important is that underlying this transformation is a set of core beliefs about nonprofits. If you believe nonprofits are largely inefficient, lack key technical skills and abilities, don’t understand their business model, you create a funding system high on accountability, compliance, and funder-driven. But if you believe that nonprofits are actually innovative, effective and have a deep understanding of their business but that they operate under an onerous set of rules, counter-intuitive practices, and an inefficient funding system, then you can give up some control, allow money to flow a little more unfettered, and buy into the nonprofits’ strategy and their approach to solving social problems.
While we are early in this process, I am very optimistic. If we look at all the great work nonprofits have done, all the great programs having impact in our communities, the lives that have been improved – the lives that have been saved – and scale that organizations have been able to achieve; you can’t help but wonder what impact could be achieved, what scale could be realized if we could just remove the well intended but often counter productive processes and practices? The question is still open, but the possibilities are tantalizing, and the impact potentially fundamentally transformative for the sector and the services that make for vibrant, sustainable and just communities.
David Greco is the Vice President of the Nonprofit Finance Fund (NFF), bringing more than 20 years of experience in to support nonprofits and funders in creating a healthy and durable nonprofit sector.