A new megadonor to charitable organizations has emerged in the U.S., raising important questions about how philanthropy is conducted. MacKenzie Scott, former wife of Amazon founder Jeff Bezos, is donating money at record levels to charitable organizations. But beyond the amount of funding is the manner in which she is donating, quickly and with considerable ease for grantees.
As the philanthropy sector in Colorado and nationally continually assesses how best to leverage its resources most effectively and efficiently, there are encouraging examples of more streamlined approaches to grantmaking that are ripe for replication here.
The stakes are considerable. Foundations in the U.S. granted $88.55 billion in 2020 and hold more than $1.2 trillion in assets. In Colorado, the top 25 foundations, with combined assets of $10.4 billion, grant more than $490 million annually. To put that in perspective, that’s a level of annual grantmaking equivalent to $870 for every adult and child living in poverty in Colorado.
Coloradans ranks 22nd compared to other states in total philanthropic giving (from individuals, corporations and foundations). Of course, with so much need in our communities, we always should aspire to do more.
Philanthropy has deep roots in Colorado. In 1887, Denver was experiencing the stark income disparities of prosperity and poverty that persist to the present day. A population that had surged from 5,000 to 100,000 in less than two decades included many families struggling with unemployment.
Recognizing the need for a dedicated and collaborative response, Frances Wisebart Jacobs, known as Colorado’s “Mother of Charity,” joined with four clergymen of different faiths to found the Charity Organization Society, which later evolved into the United Way. The first joint appeal of the new group was a success, raising $21,700 (equivalent to more than $630,000 today).
The new federation also established important standards of philanthropy, calling in its first annual report for “securing greater efficiency” in the disbursement of funds, supporting the growth of charitable organizations, and giving “the public a better understanding of the entire charity dispensation in our city.”
These standards remain relevant today. So does this early spirit of cooperation among Colorado funders.
An increasingly partisan debate has emerged among funder associations nationally, an inevitable reflection perhaps of the political climate. But in Colorado, we are fortunate to have a tradition of collaboration and shared learning among foundations that span the ideological spectrum and diverse areas of focus, facilitated and nurtured through Philanthropy Colorado and more informal interactions.
There are four characteristics to Scott’s approach to giving that can help inform that shared learning. She gives with a sense of urgency, provides grants with broad discretion on how the dollars are used (which as one of her grantees said, “makes the recipient feel honored and dignified”), centers much of her giving on education and equity (including a focus on historically Black colleges and universities, which play an outsized role in advancing social mobility). And she gives with a profound commitment to easing the time and burden of grantees in the application and reporting process.
One recurring criticism of the philanthropy sector is the customization required for each grant application, even those that contain overlapping information. As Vu Le of NonprofitAF.com has written, “Most of our time wasted is in translating the exact same information from one grant to another… Imagine a job applicant having to tailor not only their cover letter, but also their resume every single time they apply for a job.”
As reported in the Stanford Social Innovation Review, the Hewlett Foundation responded to this critique by recognizing that they “were asking grantees for a lot of information that we didn’t actually use in grantmaking decisions.” They decided to “pare down the information” that they were asking of grants to “three simple prompts” and transitioned to more longer-term general support grants.
Another positive example is the Pittsburgh Foundation, which made several changes to simplify their application process and reduce the burden on grantees, including “accepting applications submitted to other funders.”
An additional area for streamlining is in evaluation and reporting. Fewer, meaningful data points can prove more valuable than higher volume or more elaborate data collection. Fay Twersky, President of the Arthur M. Blank Family Foundation speaks about the “three legged stool” of measurement in the social sector, including the traditional legs of monitoring and evaluation, but essentially informed by constituent and nonprofit feedback that is “information-rich and affordable…and simple to use.”
Many Colorado Foundations have streamlined and simplified grantmaking while also increasing focus on community input. As Karen McNeil Miller, CEO of the Colorado Health Foundation, has said, “talk less…use that time, instead, to listen…and when you do talk, have more of your sentences end in question marks rather than periods or exclamation points.”
A century and a half ago, Frances Wisebart Jacobs arrived in Denver and began her “benevolent charity work,” planting the seeds of the modern philanthropy sector. The mission continues today as Colorado funders listen, learn, and continuously improve with a profound commitment to impacting as many lives as substantially and enduringly as possible.
Shepard Nevel has served in leadership positions at two Colorado foundations and is a former board member of the Colorado Association of Funders, now known as Philanthropy Colorado.
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