Stupid Funder Tricks

Grantmakers for Effective Organizations (GEO), one of the sector’s largest coalitions of grantmakers, is organized around a fundamental truth: “grantmakers are successful only to the extent that their grantees achieve meaningful results.”

In my last post, I described how Wilburforce Foundation developed an outcome map that placed emphasis on grantee relationships, grantee capacity, and grantee results. These elements are at the heart of our strategy.

Many of us in the sector refer to our grantees as partners. In some cases, funders and grantees do in fact forge strong working relationships that are truly collaborative. But not always. Sometimes these “partnerships” are more fantasy than fact. Perhaps my perspective is biased by the years I worked as a grantseeker, but I would argue that grantees sometimes see themselves less as partners and more as shoddily treated temporary contract employees.

What are the elements of an effective partnership? My list would include the following:

  1. Focus on shared goals;
  2. Open communication that embraces the perspectives of all partners;
  3. Sense of shared responsibility and interdependence that lasts until the work is done. As a sector, I believe we generally fail to maximize our potential to create true partnerships. Some aspects of our funding processes, internal grantmaking guidelines, and — most importantly — interpersonal behaviors may make us a bad partner. Acting out the worst aspects of the grantmaker-grantseeker power imbalance can be an impediment to impact.

Over the years, I’ve heard reports of foundation practices that are inexplicable, disappointing, or shocking. One grantee wryly dubbed these bad practices as “stupid funder tricks.” Here are a few examples that I believe undermine our sector’s potential for success, shared by grantees and culled from my own personal observations:

  • Marching to your own Bette: One of my favorite movie quotes was uttered by Bette Midler in Beaches: “But enough about me, let’s talk about you… what do YOU think of me?” Funders sometimes seem to forget that we are one of many players, and that the work is not exclusively about us. One grantee reported having to rewrite a proposal and revise a board-approved strategic plan to more explicitly align his organization’s goals, outcomes and objectives to the funder’s. Another complained that foundations sometimes seem to create initiatives that presume the participation of others without actually engaging potential partners before a new strategy is announced.
  • The view up here: I have sat through some wince-inducing meetings between funders and their “partners.” I have seen my foundation colleagues dominate the conversation, make demands, and tell a grantee that their strategy was — direct quote — “bad.” The kindest possible frame for this: funders have a uniquely broad perspective, we have seen what works and doesn’t work in other parts of our grantmaking portfolio, and we need to assure that our grantees are using resources as wisely as possible. That is certainly sometimes true. But we have to allow for the possibility that we may be wrong. Our grantees are likely to have a much deeper understanding of the social, political and economic context in which they are working than we do. Strategies or tactics that succeeded elsewhere may be ineffective applied in a new context. In short, we have something to learn from our partners, if we let them speak, and we approach with questions and not prescribed solutions.
  • ADDled Funders: Another grantee described the devastating loss of a $250,000 grant when a foundation suddenly decided that his campaign was no longer a priority. This group was forced to lay off the staff they had hired with the implied promise of ongoing foundation support, and this significantly harmed the organization and its ability to advance its goals. Other grantees have expressed dismay at the life expectancy of a typical foundation strategy, which rarely seems to last for more than two or three years. I can certainly point to funding colleagues who seem to display a bit of institutional Attention Deficit Disorder (ADD): trouble staying focused, extreme distractibility, and difficulty completing tasks.
  • I need air: Some foundations set arbitrary caps on the maximum number of years a grantee can receive funds. Despite affirmations that a grantee’s work is critically important, I have heard some funders worry aloud that groups will become “dependent” on their grants. Instead of sustaining work over the lifetime of a project, some funders retreat, forcing the group to seek new revenue sources. Funders not only hurt their grantees, they hurt themselves by sabotaging any progress they and their former partners may have made.
  • Getting to “No” you: Some foundations seem perfectly happy to reject potential partners merely on procedural grounds. Applicants who submit well-polished prose and neatly organized attachments are rewarded. Those who stumble during the process may be dinged. One funder once boasted to me that he generally declined proposals that arrived by overnight post, suggesting that if a group was too disorganized to get a proposal in early and had money to waste on delivery charges, it didn’t deserve foundation support. He had never worked for a nonprofit organization, and didn’t understand that fundraisers are struggling to meet the demands and deadlines imposed by multiple funding sources. Process-based decision-making may favor organizations with savvy grantwriters, but these may not necessarily be the groups whose programs are most effective. Instead, we should be exploring the quality of ideas or the potential for a group to advance shared goals.
  • Drowning in Paperwork: Process overload often doesn’t end when an application is submitted. Each funder imposes its own set of requirements on grant recipients. Written and financial reports are the norm. Multiplied across multiple funders, the process burden grows. Sadly, even if these reports are read—and too often they are not—they may not be useful. Project Streamline describes the problem well:

the current system of application and reporting has grantseekers and grantmakers alike drowning in paperwork and distracted from purpose. Such practices may be only a small part of the bigger picture of grantmaking effectiveness, but they threaten to undermine other grantmaking effectiveness efforts by creating barriers to nonprofit success.”

If funders want to advance a strategy, they need to invest more time in developing relationships with potential partners. The due diligence process can be stronger with less transaction and more interaction.

I could go on.

I am not trying to give the impression that my colleagues and I at Wilburforce Foundation have an unblemished history of perfect behavior. Nor do I want to suggest that the shortcomings in grantee-funder partnerships are always the fault of the grantmaker. But generally speaking, we funders can and should be more sensitive and responsible in wielding the power we accrue as the check-writer in the relationship.

I’ve described some of the symptoms of bad partner behavior. Now I’d like to propose some simple remedies:

  • Identify shared goals: We have the power to impose our strategic vision on others, and will almost certainly find grantees to happily use our funding to advance our ideas. But I would argue that our strategies will be stronger if we work with — and are influenced by — our partners. If we ask questions and invite feedback from grantees, welcoming their knowledge and perspectives, we can strengthen our strategies.
  • Be patient: Achieving real impact takes time. If we want to forge effective partnerships, we should commit until we have succeeded…or until the evidence suggests that we cannot succeed and a new strategy is needed. Shiny new projects may seem irresistibly alluring, but pursuing new initiatives make it less likely that your previously funded work has time and resources to yield results.
  • Build better relationships: We must communicate clearly, consistently, openly and frequently to better understand each other’s goals and strategies. All partners need timely information about new developments, opportunities, and threats that emerge. A partnership cannot simply rely on the process-oriented elements of our work: applications and reports. We need to shift from transaction-based grantmaking to interaction-based partnerships.
  • Invest in our partners: Rather that worry about dependence, we should instead recognize our interdependence. To the extent possible, we should be making long-term investments in the capacity of our partners. We should be making explicit multiple-year commitments. We should be helping groups with leadership coaching, fundraising, financial management, evaluation, technology, communications, and other investments that build effective and efficient organizations. We can only succeed if our partners succeed.
  • Invest in ourselves: Many of us focus on foundation overhead, striving to keep that number within some benchmark percentage. Instead, we should align foundation operations and programs to assure that we have sufficient human and financial resources devoted to successfully advancing core strategies. We may need to make investments in our own capacity to be effective partners: hiring or reassigning staff, changing grantmaking processes, or shifting to fewer strategies that we can implement more thoughtfully.

It is hard work to be an effective partner. I have learned from experience, though, that healthy partnerships are at the heart of our biggest successes.

Written by Paul Beaudet

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