Question: If you had $1 million or even $5 million to give away to charities, would you want to be bombarded by grant proposals from organizations you’ve never met? Be honest…
Over the past couple months, there’s been another debate about the merits of strategic philanthropy. The typical pundits have been involved. Bill Schambra, Pablo Eisenberg, the right-leaning Philanthropy Daily, the left-leaning National Committee for Responsive Philanthropy (NCRP), and others weighed in with their cautions and sometimes downright revulsion to strategic philanthropy. Paul Brest, Phil Buchanan, and others have weighed in with the advantages of strategic philanthropy done well.
Frankly, the same pundits have made many of the same points before, and some used this debate as a platform for their other beefs with foundations. That’s fine – as a philanthropy geek, I love that the debate comes up from time to time and I see merits on both sides.
However, Pablo Eisenberg and Niki Jagpal from NCRP committed an unfortunate logical fallacy. Eisenberg quoted a statistic from the Foundation Center: 60% of the 86,000+ foundations in the United States state that they do not accept unsolicited proposals. They then make the leap to assume that most or all of the foundations in that 60% are strategic grantmakers. They paint those foundations with phrases such as “[we] know what’s best for nonprofits, their constituencies, and the greater good,” “philanthropic arrogance,” and “technocratic and top-down.” An unsavory lot, indeed.
Here’s the fact they glossed over: more than 80% of all U.S. foundations and 86% of family foundations are under $5 million in assets. Small foundations and family foundations choose not to accept proposals for these reasons and more:
- They have a few organizations they love and continue to support. They’re actually following the advice of Grantmakers for Effective Organizations and many of the pundits listed above by providing general operating support over time.
- They don’t want inundated with requests because they don’t have paid staff or the personal time to deal with requests. Would you rather be generous in ways that are meaningful to you or spend time reading through mind-numbing piles of requests and screens of emails? Would you want to spend limited charitable resources hiring someone to screen proposals or would you rather use that money for grants?
- They’re using their own networks of relationships, personal wisdom, local and international news about needs, site visits, presentations to churches and civic clubs, social giving resources, and more to find good charities. The pundits (looking at you Schambra) who describe strategic philanthropies as “technocrats removed from real needs” should be lauding these families.
- They’re attempting to be quiet about their grantmaking due to their personal values or religious beliefs, or because they just plain don’t want hit up with proposals at the grocery, at parties, or even in the restroom. (I’m not lying – all three have happened to friends or me).
Put yourself in their shoes – would you really create an open proposal process? (If so, I know talented people who would happily be paid to help you with this.)
Tony Macklin 
It is a sport to critique the evil realm of foundations that do not accept unsolicited proposals.
Yes, there is a dark side to the Great Exclusionary Wall of Philanthropy.
But I am glad you are exploring how the practice of not accepting unsolicited proposals offer advantages for foundations.
As you make clear, closed proposal processes act like SPAM filter for foundations.
Closed grantmaking processes increase the signal-to-noise ratio and allow for more in-depth conversations with fewer organizations rather than shallow drive-by conversations.
They dramatically reduce operating costs so more resources are spent in the field rather than in the office shuffling papers and transacting.
And while the critique that foundations are aloof, out of touch, and disconnected to real people in the communities they serve rings as loud and true as ever, many funders also pretty well connected.
We see every day how they are often wired to information and networks and enthusiastic about learning who is doing what. We love how this can increase the opportunity for more organizations to get access to resources rather than just the ones that have more capacity and know how to play the fundraising game or the ones that are anointed by other foundations.
We see how funders are much more proactive in soliciting new ideas from strong organizations — many think that it is a heck of a lot better than waiting for something to come across the sterile wasteland of those infuriating text-delimited on-line application forms or “fishing” emails so beloved by development staff.
Thanks for the additional thoughts, Prentice! I agree that many small foundations, especially the newer generation, are doing a smart job of proactively soliciting good ideas. I know that some fundraisers critique this process. They worry that a foundation’s problem-solving viewpoint may be too narrow, or that its set of relationships will lead it to a limited pool of ideas. I think it’s normal (and very human) to start with what one knows. It may be more a worry when a donor or foundation leader (or any person) chooses not to then build on what he or she knows and draw in new ideas, relationships, and source of talent.
P.S., I’m stealing your great turn of phrase “Great Exclusionary Wall of Philanthropy” for a panel session I’m on tomorrow (credited to you of course). 🙂