If Grant Making Needs to Change so too Does Capacity Building

Last week, both Vu Le and Kathy Reich wrote and shared articles with lessons for how to improve the way grant makers support nonprofits tackling issues of inequality and justice. This topic is one we think about constantly in our work at the Accelerator, and these are two thinkers whose insights we invariably find valuable.

Kathy Reich leads BUILD, the Ford Foundation’s 6-year, $1 billion investment in 300 nonprofit organizations in the United States and around the world. This investment is intended to help these nonprofits become stronger, more sustainable and more durable organizations.

Vu Le is the Executive Director of Rainier Valley Corps. Rainier Valley Corps promotes social justice by cultivating leaders of color, strengthening organizations led by communities of color, and fostering collaboration between diverse communities.

In a report reflecting on a year of her work with BUILD, Kathy identifies 6 lessons they have learned thus far with BUILD.  Last week on Vu Le’s blog, Nonprofit AF, he shared his perspective that conservative foundations have been more effective than progressive foundations in achieving their objectives. This perspective was reinforced in a recent Inside Philanthropy article, How Top Foundations Failed to Defend Their Values.

While Vu is drawing lessons that can be applied to grant making writ large Kathy is drawing lessons from grant making that supports organizational strengthening. Although written separately there is an intersection between the two that caused us to reflect on our own practice and the way we support nonprofits and grant makers. 

Below I’ve lined up their lessons to highlight the overlap and why we should all pay attention. 

Kathy’s Lessons

Vu’s Lessons

Lesson 2: Grants should be significant and unrestricted.
Lesson 3: Grants should be minimum 10-years in duration.
Lesson 1: Nonprofits thrive with larger, longer, more flexible grants.

Lesson 9: Focus on the big picture and get out of the weeds

Lesson 2: Long-term, flexible grants work best when they closely align with strategy.

Lesson 1: The funding relationship must be grounded in trust and partnership.

Lesson 3: Grants like these can foster deeper relationships between grantmakers and the organizations they support—but money can’t buy trust. It takes work.

Lesson 5: At least 75% of all grant funding should go to organizations led by and serving communities of color and other marginalized communities, as reflected by their staff and board.
Lesson 6: Foundations must diversify their boards of trustees to reflect the community they serve; at least half of most foundation boards should be of color.

Lesson 4: Grants like these can work anywhere in the world.

Comment: While not an exact match between Vu and Kathy’s lessons, for grants such as those made by BUILD to work anywhere in the world what has to be in place? A diverse team? Contextual understanding? Organizations and staff with a particular set of experiences?

Lesson 8: Support leaders, movements, and institutions, not specific issue areas.
Lesson 10: Be engaged in policy and politics.

Lesson 5: Supporting institutions is critical—but so is catalyzing and supporting networks.

Comment: While Vu does not have an evaluation lesson in this post he wrote an extensive post this time last year, How the Concept of Effectiveness has Screwed Nonprofits, that bears rereading. Both patience and evaluation are important, So too is a discussion of what is being evaluated and by whom.
Lesson 6: Patience is a virtue. So is rigorous evaluation.

During a time of social, political and economic upheaval there is an opportunity for those of us who work with leaders, organizations and networks in the social sector to create new ways of working that align with our values and help to create positive change. Unfortunately, there is also the opportunity for the lessons shared by Vu and Kathy to remain lessons observed but not learned. The lessons Vu describes are not new. He traces the roots of his lessons to an article written by Karen Paget almost exactly 20 years ago.

Failing to make the types of changes Vu and Kathy argue for is to perpetuate and reinforce systems that undermine the leaders and organizations doing the lion’s share of the work to eradicate inequality. Kathy’s belief that grant makers should award more general operating support is one we share. Unfortunately, grant makers seem to be trending away from general support grants. Kathy points to a Grantmakers for Effective Organizations report that finds, “The median percentage of grant dollars awarded as general operating support has actually decreased in the last several years, remaining at roughly the same rate since the 2008 recession.”

At the Accelerator, we follow both Vu and Kathy’s work closely as we support nonprofits and grant makers. How should the lessons Vu and Kathy point to influence grants aimed specifically at organizational strengthening? If grant making more broadly needs to change, don’t many of the same reasons why apply to  ‘capacity building’ and the way ‘organizational strengthening’ support is provided? 

To reinforce the changes in grant making, at the very least, organizational effectiveness support should be: 

  1. longer term, as a general rule; 

  2. more focused on supporting organizations to achieve their mission and less in the weeds;

  3. co-designed with organizations and provided by a diverse set of technical assistance providers;

  4. understanding of the larger context and networks in which organizations work, and; 

  5. designed in a way that fosters trust and deeper relationships between grantees and funders.