Five ways to be a better funder

Grantmaking is not easy. Good grantmaking is even harder. That is why we spent the large part of two years speaking to grantmakers and grantseekers and grantees about their experiences – good and bad - and then wrote a book to help donors improve how they do things.

We believe that underpinning good grantmaking are five core values which, when placed at the heart of a donor’s strategy, can achieve the maximum impact while also supporting those receiving the grants in the best way possible to develop their capacity.

First up is humility. Humility in grantmaking means not seeing yourself as better than the people you’re funding. This is essential, because without humility and if you think you’re smarter and better that your grant recipients, it’s all too easy to make arrogant mistakes.

For example, we were told one story about a nonprofit that ran a very successful face-to-face training scheme. The funder repeatedly pushed the nonprofit into building a large video based online training course - think YouTube - despite the grantee strongly expressing that this wouldn’t work for the skills they were looking to impart.

Unsurpisingly, the video scheme didn’t work well and this is a clear-cut example of what grantmaking looks like when humility is missing. We see humility the first amongst equals of our five values because we believe, if you practise it well enough, other good funding practices will tend to follow naturally.

Number two in our list is the value of equity. In our definition, this means looking at all aspects of grantmaking and constantly asking the question ‘Does this seem fair and just?’

Why is this so important? Well, traditional grantmaking can, unfortunately, quite often suffer from a very visible lack of fairness. For example, grant money can - and does often - end up flowing along paths of least resistance towards organisations whose leadership dwells in the same social circles as philanthropists or grantmakers. This is too often at the expense of organisations and leaders that simply never get invited to the right parties but who all the same lead innovative organisations impacting many lives.

Valuing equity drives funders towards making both external and internal changes. Externally, it can help ensure that money is used to support nonprofits led by people who experience different types of inequality, from disability to class to gender. Internally, valuing equity can lead to funders changing recruitment policies, applications processes, board membership, and even who makes funding decisions.

The third value is evidence. Valuing evidence means caring about whether or not a grant is successful, or conversely whether it has little or no impact, or worse still, causes harm.

Caring about impact means taking steps you wouldn’t otherwise take to evaluate grants properly, and to participate in the wider process of useful knowledge generation.  In practice, valuing evidence means being willing to invest in systems and processes (and paying for professional support) without seeing this as expenditure on “unnecessary overheads”.

Fourth on our values list is service. This might strike you as a bit strange, especially if your funder thinks of grantees as people and organisations that should be grateful for what they get. After all, as grantmakers we don’t have to treat grantseekers like businesses treat customers. But the value of service means that we should treat them as if they could walk away.

We should value service not just because it’s moral to be nice and respectful to hard working people, but more urgently because if we make our money exhausting and difficult to access, then it will tend to skew towards highly educated people who can overcome all the barriers we erect.

Funding organisations that don’t value service are, basically, funding organisations that don’t want to give money to people without university degrees. This brings back the equity question and is important because some of the best nonprofit work is being done by frontline, local organisations, who are less likely to be skilled in grant paperwork.

Lastly, we believe diligence is the fifth and final value of modern grantmaking. This means putting in the hours and the effort to actually try to do grantmaking well, and not coasting along on the idea that grantmaking must be easy.

Diligent grantmakers understand that just because it’s easy to chuck money out the window, that doesn’t mean it’s easy to make impactful grants in a way that is humble, equitable, service-driven and evidence-based.

We believe that following these guiding principles can help you to clarify what might otherwise be very vague and head-spinning feelings that ‘something isn’t quite right’. 

All you need to do is to think about an activity or project you may have on the go at the moment, and ask yourself, “Are our actions in alignment with these five values?”