There is yet another kind of underused big-bet opportunity that nonprofits and NGOs could pursue: the kind that requires organizations to develop a concept worthy of investment for turning a large infusion of philanthropy into enduring change. These big bets underwrite the types of social change work that can only be achieved with major philanthropy and that have been at the heart of important societal advances for decades. This second sort of big bet is where we see the supply problem. Because raising dollars for day-to-day operations is often all-consuming for nonprofit leaders, it can be challenging for them to develop the kind of strategy that would attract and warrant such a big bet.
Two of these, an important problem and a strong leader and team, will already be familiar to almost any leader who has pitched a potential donor. This article focuses on the other three: point of arrival, a credible path to that arrival point, and the role of philanthropy.
A compelling investment concept needs a clear and concrete goal or point of arrival. That goal will typically be accomplished over a span of five or 10 years, perhaps even longer, and have an enduring impact.
Over 10 years, the Lavines and the Einhorn Family Charitable Trust have invested more than $50 million, joining with a core set of lead funders strengthening the graduation pipeline. The specific point of arrival they and City Year sought was to nearly double the number of students who reach 10th grade on track and on time in the schools it served in 10 years.
City Year had the essential elements for a big-bet point of arrival: an ambitious, measurable goal that matters not merely to City Year, but to others involved in public education, too. In developing its investment concept, City Year built on an existing asset, in this case the 75 percent of its corps members who were already serving in schools. But it also created an entirely new impact goal of dramatically increasing the number of students who were on track to graduate in the cities it served. Most importantly for a point of arrival, there was already an existing demand for this goal: Addressing disparities in high school graduation rates was widely seen in the field as a critical element in closing opportunity gaps and strengthening communities.
Both social change leaders and donors want their work to amount to more than a drop in the bucket. But the greater the gap between the vision and the work being undertaken, the more a strategy for achieving it can seem like only a drop. Shifting the focus to a clear arrival point can help close this gap, unlock much larger donations, and focus strategy and resources in powerful ways.
A compelling point of arrival will typically need to include three main components: it must be clear about the specific results that can be achieved; it must articulate a goal that matters and warrants significant support; and it must demonstrate demand for the arrival point from communities, partners, policymakers, and other major stakeholders.
We have described the point of arrival for the ideal big-bet investment concept as ambitious, concrete, and practical. The credible pathway, by which we mean how the organization believes it can get to its five- or 10-year point of arrival, is where that concreteness and practicality show themselves and where social change leaders increase the odds that they will actually achieve their goals.
Consider marriage equality in the United States. After Massachusetts became the first state to legalize same-sex marriage in 2003, the following year 11 states enacted amendments banning same-sex marriage, often by sweeping vote margins. Eager to put substantial funds behind the fight for marriage equality, major funders led by the Gill Foundation and the Evelyn & Walter Haas, Jr. Fund brought together more than two dozen LGBTQ leaders in 2005 to devise a common strategy.
A group of recipient organizations worked together to execute the road map. After a combination of judicial and electoral victories, more and more states enacted marriage equality laws. Then in 2015, the US Supreme Court ruled same-sex marriage was a constitutional right.
Not all ambitious advocacy campaigns succeed, though. Consider initiatives focused on such areas as gun control or school vouchers, where progress has been challenging. Big bets, whether focused on advocacy or direct services, often embody significant risk. A credible pathway does not necessarily mean the exact pathway that change will end up following. The initial road map for marriage equality did not include what ultimately became the winning message (love and commitment rather than civil rights); instead, it focused on creating the infrastructure that would be needed to develop, test, and spread that message.
When donors make big gifts to universities, hospitals, or major cultural institutions, the role of philanthropy is usually fairly clear. If it is a building campaign, for example, the gift allows the wing or building to be built. Frequently, philanthropy accounts for the entirety of the funding, so its impact is obvious.
Marriage equality was a classic example of using a big bet to wage an advocacy campaign. Here, the role of philanthropy is to take a risk that no one else will take. Such a big bet can provide the critical infrastructure required for movements: materials, people, transportation, legal services, research, and more. It can also represent a vote of confidence, especially when the odds against progress are high. When the Haas, Jr. Fund made its first contributions in support of marriage equality, momentum seemed to be going in the opposite direction, with more and more states amending their constitutions to ban same-sex marriage. Big investments in advocacy offer leaders the time they need to weather defeats and press forward to create change.
For Upstream, which is focused on changing the way health centers deliver family planning services across the country, one of the roles philanthropy played was to fund targeted, one-time technical assistance that will change practice, likely for years to come. Through its time-limited training intervention in health centers, Upstream seeks to create a new standard of service delivery across the nation. Fields ripe for this sort of investment tend to be ones where viable ongoing funding models exist but service delivery is fragmented, important ideas or practices are not in broad use, and competitive dynamics do not seem to push toward improved outcomes.
Many effective organizations will continue to rely on philanthropy in the long run. They may not be able to promise that government will fund the program, or that it will generate its own revenue, or that the change will simply sustain itself. But it is likely that many donors contemplating a big bet will want to know, at a minimum, how, specifically, the gift will help change the capabilities and prospects of an effort over the longer run.
By developing an investment concept with a clear and compelling arrival point, a credible path for getting there, and a well-articulated role for philanthropy, already strong organizations may be able to increase their chances of securing big bets and deploying them with distinctive impact. While we have presented these three levers sequentially, they are almost always iterative: getting immersed in defining the credible path may change the point of arrival; crisply articulating a role for philanthropy may shed light on the credible path.
This article has focused primarily on the work that organizations need to do to get the big bet. But we should not lose sight of the fact that the next 25 years offer extraordinary potential for more big bettors to enter the arena. The bulk of the highest-potential donors are in their mid-60s. They will determine what they do with their wealth in this window. They may well decide to focus on the most traditional giving options, or even leave much of their money in family estates.
We hope the most ambitious among them will consider another path and make big bets on leaders attacking the toughest kinds of social change. The more that do so, the more big-bettable opportunities nonprofits will develop. It is a virtuous circle. In part because of the very large gifts by the Lavines and Einhorn, City Year is beginning to make a dent in the dropout crisis in big urban school systems across the country. Similarly, big bets are helping Splash bring clean water to large numbers of people, and enabling Upstream to embark on a national effort to significantly reduce unplanned pregnancies in the United States. Big bets on social change can and do fail. But they also offer real hope to tackle head-on some of the most important challenges facing our communities, our country, and the world.
A big bet is not usually love at first sight, so long-term relationships matter. When Bridgespan analyzed a sample of 165 grants of $10 million or more from our big-bets databases (gifts from US-based donors to a social change organization or cause between 2000 and 2012), we found that the big-bet recipients received a median of four previous grants from the donor prior to the big bet. At the same time, a significant minority of big bets (like the one that CIFF made on Splash) are first-time gifts.
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