The Many Paths to Launching and Scaling a Collaborative Fund

Funders have long encouraged collaboration among their grantees, but historically they have been far less enthusiastic about collaborating with each other. That’s perhaps understandable given that effective collaboration means surrendering a degree of control, and many donors are loath to do that.

But, done well, effective funder collaboration can have outsize impact at scale. This is being increasingly recognized by foresightful donors and those who influence them, and has led to growing interest in collaborative funds, in particular.

While this growing interest is welcome, there is little agreement on the best way to establish collaborative funds. As a result, the way they are set up is often quite haphazard, driven more by donor interests than by the needs of those they aim to serve. A more systematic approach could unlock even greater impact.

The Appeal of Collaborative Funds

Collaborative funds have distinct advantages over traditional, single-donor philanthropy:

• Larger-scale impact: By pooling money from multiple donors, collaborative funds can tackle large, complex problems that would be too big for individual donors to address alone.

• Shared expertise: Funders benefit from collective wisdom and specialized knowledge, leading to more informed and strategic giving decisions.

• Streamlined access for grantees: Grant-seeking nonprofits can engage with multiple funders through one entity, reducing the administrative burdens that come with donor engagement, applications, and reporting.

• Inclusive, equity-focused funding: These funds are often more effective at directing resources to historically marginalized groups and movements, influencing the broader philanthropic sector in the process.

Read the rest of my article at the Center for Effective Philanthropy’s blog here.