Just over $4 million has been contributed mostly by large foundations to Grantmakers for Effective Organizations (GEO), for “Scaling What Works,” a project to derive and circulate the lessons of President Obama’s Social Innovation Fund (SIF). The SIF was authorized by the Edward M. Kennedy Serve America Act; it contains $50 million in federal dollars to be given in the fields of economic opportunity, youth development and school support and healthy futures to promote “transformative” innovations that “have the potential to affect how the same challenge is addressed in other communities”. But after all the required matches at the Philanthropic and organizational level have been counted, the fund will involve total investments of $200 million. While the money may, to some, appear limited, the potential influence of the experiment has obviously captured the imaginations of a sub-set of philanthropy.
We were interested to note that the learning project is not established as an evaluation of the strategy but as a learning community aimed at field building among funders interested in “evidence based scaling of high performing nonprofits” and in advancing a more productive relationship between philanthropic players and government. This should and does make many uncomfortable—there are generally acknowledged downsides to many “social engineering” schemes, the results of which are often never fully studied until decades later.
Additionally this project has likely emerged from and reinforces potentially very close relationships between power brokers in two major sectors. Chester “Checker” Finn of the Thomas Fordham Foundation warned in a recent Bradley Center forum that over-intimacy draws philanthropy into “the possibility of a Faustian bargain that in the throes of short-term passion fails to notice the long-term risk. The great advantage of and principal rationale for a healthy philanthropic sector in a country like ours is its independence from government, its unique capacity to do what government cannot or will not do. That’s a far different thing from serving as a guide dog, a tug boat, or an aide-de-camp to government itself.”
GEO has positioned itself as a convener of dialogues on the SIF since it was conceived. Kathleen Enright, GEO’s CEO told NPQ they became curious early in the development process about how and by whom the fund would be informed. GEO was then asked by the White House Office of Social Innovation and Civic Participation to host three meetings with grantmakers. Enright says she was “thrilled with how earnest that office was about understanding the context of philanthropy.”
At the same time, the SIF was reportedly using Bridgespan, a consulting firm which has been a core part of the scaling strategies of some of the large foundations funding the “Scaling What Works” project, to do research about how best to frame and structure the fund. And right before the GEO conference, the SIF appointed Paul Carttar as its director. Carttar is a co-founder of Bridgespan and a former staff member at New Profit which is not only one of the funders of GEO’s learning community but which revealed on April 7th that it had applied to be a funded intermediary. These kinds of close relationships in the run up to the Fund’s first disbursement of dollars has created a sense of déjà vu among some seasoned observers who have experienced wave after wave of the social enthusiasms of insular elite groupings that fail to live up to their promise. One observer dubs it a philanthropic “ponzi scheme”.
GEO is a big organization, however, with diversity of membership and opinion, so the announcement of this “Scaling What Works” project at its national conference and Paul Carttar’s address as part of a panel in the closing plenary was not met with a complete lack of skepticism. There was quite a bit of pushback, particularly, both on the panel and in the audience about replication as a primary strategy for “scaling” success in the sector. In fact, GEO, itself, appeared to help surface these issues with a panel earlier in the conference that contrasted replication against network development as strategies to achieve impact. Enright acknowledged that GEO’s decision to adopt this role was not without contention. “The board talked about it for nearly a year and finally came to the decision that we should play this role, even though it’s uncharted territory. We expect to hire a seasoned leader to be on point here and that person will not be wedded to a particular model of effective growth and scaling. That person will need to be something of an orchestra leader because we not only have differences of perspective within the key stakeholder communities but we will also be subcontracting a lot of work.”
Meanwhile, this past week, the SIF announced that it had received a total of 69 (undisclosed) applications from prospective intermediaries in 25 states and that it had a panel of independent experts in place to review those applications and winnow them down to between seven and ten successful candidates. The press release billed the field of applications as indicating “community support” for the fund, which is a bit of a stretch. The $50 million is available money in a recession offered to a resource-starved sector that still has enough relatively well heeled players to pay the freight that their involvement in the SIF will require. Will that ensure that the capital markets in the sector will be “democratized” as Carttar has suggested? We very much doubt it and these kinds of overstatements make us nervous about the degree to which most involved have already drunk the Kool Aid, pronounced it delicious and now see evangelism as their mission.
It is a promising step that the SIF is involving GEO in all its grantmaker opinion diversity but we would suggest a few additional things that might be done by whomever is involved in organizing the learning from the project: 1) do a network analysis of the grouping that has been intensively involved to date and 2) commission the kind of rigorous, longitudinal, comparative “evidence-based” study that SIF promotes for others so that its real lessons—positive and negative—can be gleaned for the future.