Philanthropic Thinking

Why we say ‘funding opportunity’ instead of ‘charity’

Published on
2021-02-22
Written by
Anu Khan
Rachel Baxter
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There are over 10 million charities in the world. Some fail at their mission, some are moderately effective, while others are highly impactful, doing much more good per dollar donated than the average charity. We recommend a number of cost-effective, high-impact charities doing brilliant work, but we generally refer to our recommendations as ‘funding opportunities’. That’s because we don’t just recommend charities, and we sometimes only focus on a specific area of a charity’s work when we do. We don’t limit our recommendations to individual charities for a number of reasons, which are outlined in this blog.

It’s not just charities that do good

When we think about giving, the word ‘charity’ quickly springs to mind. While many charities around the world are doing excellent work and are in need of additional funding, they aren’t the only organisations doing good. Of course, we’re not saying that you shouldn’t give to charity, but rather bear in mind that you might be able to have a significant impact by supporting other kinds of organisations and initiatives, like universities, scientific research programmes, think tanks and nonprofit organisations.

A great example of this is Educational Initiatives, a Founders Pledge-recommended organisation improving learning outcomes at low-income government primary schools in India. It achieves this by providing the schools with a software programme called Mindspark that tailors questions to the student. While we estimate Educational Initiatives to be among the best ways a donor can improve educational outcomes for young children, it is, in fact, not a charity, but rather an edtech company with a nonprofit arm. (Learn more about our education research and funding opportunities here.)

Meanwhile, great funding opportunities often come in the form of research that has the potential to drive change. We recently began to recommend a compelling new research programme led by Dr Philip Tetlock and Dr Pavel Atanasov. Dr Tetlock is a leader in the field of forecasting and the programme we recommend focuses on understanding, forecasting and mitigating global catastrophic risks - for example, those caused by natural or engineered pathogens, artificial intelligence, nuclear weapons or extreme climate change. The COVID-19 pandemic has shown us just how crucial it is to predict and prepare for global crises, and Dr Tetlock’s has potential to significantly improve how we do this and help us safeguard the future of humanity.

If we want to tackle the world’s most pressing problems, both today and into the future, we need to look beyond just charities so that we do not miss promising, impactful solutions to the global issues we face.

A gap in the market

On our mission to help our members maximise the impact of their giving, we focus on neglectedness - that is, how much attention a problem receives from funders. For example, in the case of animal welfare, reducing the suffering of animals at shelters, like cats and dogs, receives magnitudes more funding than reducing the suffering of farmed animals. In 2017, just 0.03% of all philanthropic funding in the US went to this cause, despite the fact that the majority of the 75 billion farmed animals killed for food each year live in conditions we would consider intolerable for our pets. We would therefore describe this area as neglected by funders, and a place where our community can make a big difference.

Once we identify a neglected issue like this, and find the best interventions tackling the problem, we turn our attention to the organisations carrying out these interventions. In the case of animal welfare, one of our recommendations is Global Food Partners. This is not a charity but rather a not-for-profit consulting organisation that works with food businesses and farmers in Asia to implement improved animal welfare policies and practices. We’re looking for solutions to globally neglected problems, and sometimes those solutions are not conventional charities.

This also means we will not recommend a charity implementing a great solution if that charity is not neglected - or funding constrained - itself. This might feel counterintuitive. However, it’s all about what we call counterfactual impact. We’re on the lookout for opportunities where extra funding from our community creates the biggest difference, compared to if our members gave nothing at all. Therefore, if we do not recommend an organisation, it does not mean we think its work is poor, but rather it can fill its fundraising needs without our community’s support.

In our advisory sessions, we’re often asked why we don’t recommend well-regarded organisations like Doctors Without Borders. While we don’t doubt that this organisation is doing great work in the crucial area of global health, we also know that it is a popular charity that is already very well funded. Meanwhile, the global health funding opportunities we recommend are in need of additional funding to carry out their high-impact work, such as the Against Malaria Foundation and HKI’s vitamin A supplementation programme. These organisations can productively use millions of dollars in additional funding to save the lives of children through evidence-based, cost-effective solutions.

Timing counts

Sometimes, a charity might be fully funded and not in need of our support. However, certain moments, such as political events or global disasters, might mean an important funding opportunity at that charity suddenly opens up. This is another reason why we focus on funding opportunities rather than organisations as a whole. The recent change from a Trump administration to a more climate-focused Biden administration in the US, equipped with an effective Democratic majority in the Senate and House of Representatives, presents an exciting opportunity for philanthropists to have outsized climate impact. Policy advocacy organisations currently have greater leverage to drive change, opening up greater funding opportunities in this space at this time.

Though we don’t recommend reactive giving for individual donors, which is often less effective than strategic giving, we recognise the importance of seizing high-leverage opportunities for impact. The Founders Pledge Funds are designed to help members do this. Organisations’ funding needs fluctuate, and our Fund Managers take this into account when assessing where best to give.

In essence, finding where best to give has many nuances - it’s not always as simple as finding which charities work best. If you’re a member and have questions about your giving or which funding opportunities might be best for you, please don’t hesitate to contact your Advisor or email us at advisoryservices@founderspledge.com. We’d love to hear from you!

Anu Khan

Author

Anu is our San Francisco-based Research Advisor. Prior to joining Founders Pledge, Anu was a materials science and engineering researcher at Northwestern University and Caltech. Her work focused on high-temperature electrocatalysts for fuel cells and direct solar-to-chemical energy conversion, both clean energy technologies for a hydrogen-friendly energy economy. She transitioned from academic research to Founders Pledge to understand and address the broader challenges in the climate space. She received her MS in chemistry from Caltech and her AB in chemistry from Princeton.

Rachel Baxter

Co-Author

Rachel is a Communications Writer at Founders Pledge. Before joining the team, Rachel was a copy editor and staff writer at the popular science news website IFLScience, where she wrote about everything from astronauts to dancing chimps. She has a degree in zoology from the University of Bristol and master’s degree in science communication from Imperial College London.