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

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 organizations 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 organizations and initiatives, like universities, scientific research programs, think tanks and nonprofit organizations.

A great example of this is Educational Initiatives, a Founders Pledge-recommended organization improving learning outcomes at low-income government primary schools in India. It achieves this by providing the schools with a software program 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 program led by Dr Philip Tetlock and Dr Pavel Atanasov. Dr Tetlock is a leader in the field of forecasting and the program 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 maximize 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 organizations 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 organization 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 organization, 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 organizations like Doctors Without Borders. While we don’t doubt that this organization 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 program. These organizations 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 organizations 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 organizations 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 recognize the importance of seizing high-leverage opportunities for impact. The Founders Pledge Funds are designed to help members do this. Organizations’ 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 get in touch with your Community Manager or Advisor. We’d love to hear from you!