There’s a bottoms-up practice that can greatly improve our philanthropic ecosystem. It’s the practice of building capacity from the ground up, starting with nonprofits. When grantees are equipped with the kind of tools and technologies that foundations can access and have the budget for, their important work can become easier, more collaborative, data-driven, and transparent.
Nonprofits are often forced into a “grantseekers dilemma.” For example, sometimes an organization applies for a grant that requires a certain kind of capacity, knowing they don’t have it, but hoping that with funding they can obtain it. It’s a lose-lose, for both funder and grantseeker, and reveals the critical importance of capacity building grants for effective nonprofits.
Any time the philanthropic sector has an opportunity to learn more about each other and the work that we do, we all benefit. A perfect example is the latest report from the Center for Effective Philanthropy, Benchmarking Foundation Evaluation Practices.
The key takeaway: The sector has limited capacity to take on meaningful evaluation. And foundations bypass developmental or formative evaluation at their own risk. Without undertaking this important work up front, capacity for evaluation practices will remain woefully inadequate.
I am all for the most recent developments in philanthropy. For example, I like data: It helps us measure things like program quality and even overall impact. It helps the social sector do better work. And I think transparency is critical: Sharing what we learn from our successes and failures creates a much stronger sector. And no, I’m not just a fairweather fan of these trends, I have witnessed the long-term benefits of transparency and data-driven grantmaking. They’re here to stay – and for good reason.
One other development in philanthropy I love? Capacity-building grants. More and more foundations are offering this game-changing support, and I believe the social sector is stronger for it.