It is one of the ideas with the greatest currency in philanthropy right now: More funders need to make large, unrestricted grants, and then trust nonprofits to use them well. Despite all the dialogue, however, the practice is still all too rare. Giving in this way still feels “risky” to many donors.
What actually happens when nonprofits receive large, unrestricted grants? The Center for Effective Philanthropy’s (CEP) recent examination of MacKenzie Scott grantees, along with complementary research by Panorama Global, sheds light on this question. (In the interest of transparency, it is worth noting Bridgespan is among Ms. Scott’s advisors, but was not involved in either CEP or Panorama’s research efforts.) The emerging empirical answer, per CEP’s report — is that “the effects have been dramatically and profoundly positive.” This creates grounds for optimism that giving in this way has breakthrough potential.
These are early observations, given the recency of the grants, the studies’ authors rightly note. Many wonder if a “lottery curse” akin to jackpot winners entering into “periods of wild spending” (as IDinsight’s Ruth Levine framed it) might manifest over time. To begin to flesh out that longer-term picture, we’d like to add another dataset to this growing body of insights.
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