Picture someone troubled by an article about growing numbers of children dying from preventable causes. Motivated to help, she decides to donate, but she is a charity novice and doesn’t know where to turn.

A few years ago, she might have opened a search engine and typed, “Where should I donate to save children’s lives?” The query would have generated a long list of links. The donor might have spent an hour clicking through charity ratings, reading annual reports, comparing local and global options, and weighing her values against the evidence. The path was imperfect, but it left room for discovery.

Now imagine the same scenario today. Bypassing search, our donor consults AI chat interfaces. One recommends donating to GiveWell’s top charities—Against Malaria Foundation, Helen Keller International, Malaria Consortium. Another recommends donating to GiveWell’s Top Charities Fund directly. The answers differ slightly, but the tools converge on the same destination. They do not surface other ways of having impact: community health workers supporting underserved families, early research on a pediatric disease, or a smaller global health group that the major charity evaluators have not yet rated. Both close with a version of the same line: “If I were making one donation, I’d make it this one.”

To be clear, this is a worthwhile answer: GiveWell does extraordinary work directing dollars to highly effective charities that save lives. The problem is that AI can redirect a broad human impulse to help to a narrow, confident answer before the donor has had a chance to discover what kind of giver she wants to be. No hedging. No alternatives. No reference to the thousands of other local and global organizations with track records of improving children’s lives.

Search used to hand donors a menu. AI hands them a verdict. The judgment is polished and confident, but it leaves out different nonprofits from one tool to the next. Well-funded local and national groups with steady press attention, third-party rankings, and tidy, structured data show up immediately in AI queries. Smaller or newer community-led organizations doing great work might be somewhere in the results, but they often stay hidden unless the donor knows what to ask for.

For the donor, what gets lost is the opportunity for individualized discovery—the chance to encounter novel approaches, stumble upon local actors, and weigh contradictory signals before settling on a personally meaningful choice.

This is a sea change for nonprofits that could become the next digital divide—not between organizations with websites and those without, but between organizations that AI tools recommend confidently and organizations whose credibility is still growing or lives mostly offline. Those in the sector who care about donors finding causes to support need to address this new visibility gap.

The Shift Is Already Underway

This concern isn’t hypothetical. Striking changes are already clear in at least three strands of data.

The first strand involves traffic to nonprofits’ virtual front door. M+R’s 2026 Benchmarks Study of 180 nonprofits found that organic search traffic declined consistently across 2025, a trend that the study attributes to AI-generated overviews that discouraged users from clicking through to sources. A similar study by Blue State found an even sharper slide, with organic search traffic to 24 nonprofit websites falling 35 percent in the first 10 months of 2025 compared with the same period a year earlier. People haven’t stopped searching for ways to give; they’re just ending up on fewer nonprofits’ sites.

The second strand is what the AI layer is doing in place of organic search. An evaluation by Whole Whale of multiple AI models recommending charities found a “herding effect,” with recommendation lists compressing toward small groups of big organizations that have been validated by third parties. Across cause areas, recommendations bunch around roughly 100 nonprofits within individual cause areas, even though the US social sector has more than 1.9 million registered organizations.

The third strand concerns how AI tools are influencing donors’ actions. Giving Compass has been running an AI-driven search experience inside Charity Navigator’s website that processed more than 22,000 queries during an initial three-month pilot. About 80 percent of those were cause-based rather than organization-based searches—which means donors were arriving with a problem to solve, not with a nonprofit already in mind. Within that experience, donors who used the AI search tool completed a donation at twice the rate of donors who used the site without AI.

The implication is important: When AI is well designed and embedded in the right place, it can accelerate giving decisions. But this raises the stakes of what AI tools recommend. A motivated donor scrolling quickly through a narrow list isn’t exploring—they’re converting. And if that list consistently runs to the same 100 organizations per cause area, the other nearly 1.9 million never enter the picture.

Take those three strands together and the picture is clear. Donor intent is still there, and they want a clear way to give. What’s changing is how that intention becomes a choice. The route from curiosity to donation is being redirected. Discovery used to be something the donor drove, clicking around, comparing, circling back. Now it’s mediated by an AI screen that decides what to surface and what to bury. The funnel tightens, options shrink; and once the tool feels accurate, donors tend to move quickly and accept what’s presented as the right answer. That’s a powerful dynamic and a serious responsibility. Who shows up in those results matters more than ever.

What Nonprofits Can Do

Nonprofits can’t solve these challenges on their own. But here are five ways they can address the AI visibility gap that do not require huge investments:

1. Begin with the basics. Keep the core facts about your organization easy to find, up-to-date, and presented in consistent ways. AI models cross-check. The description of your mission, programs, and outcomes on your website should line up with what appears on your Candid profile, your Charity Navigator listing, your annual report, and your tax filings. When AI models encounter conflicting language or data, they are likely to default to larger, well-documented organizations.

2. Don’t let third-party profiles drift. A few years ago, seals of approval from Charity Navigator or Candid felt like charming icons to park in the footer of a website. In today’s AI-filtered world, those profiles function more like the master record of a nonprofit’s credibility. When a donor asks an AI model who you are and what you do, that’s where it goes. An outdated profile on a third-party site isn’t a minor nuisance anymore.

3. Match your messages wherever you show up. Think press releases, partner websites, foundation databases, board biographies, and conference agendas. Every mention of your organization is a signal. Mixed messages register as static. Repetition and alignment read as credibility.

4. Run reality checks. Prompt ChatGPT, Claude, Gemini, and other AI models to sum up what you do, who you serve, and why a donor should support you. Look closely at what comes back. If the conclusions are incorrect, vague, or missing important pieces, see where your signals are weak. Some models offer ways to submit corrections on the spot—if so, take them up on it. Otherwise, correct the source of the flawed data.

5. Listen to the AI developers. Earlier this year, Google released a developer guide aimed at content for generative AI features. The guidance debunked many techniques popular in nonprofit marketing circles, such as keyword stuffing, special AI markup files, and slicing pages into AI-friendly chunks. Instead, it reinforced the importance of fundamentals: clear writing, correct details, and a steady, consistent presence in resources that carry weight.

What the Broader Ecosystem Can Do

If AI-mediated discovery becomes yet another burden for individual nonprofits to address, those most at risk—which tend to be those with the smallest budgets—will fall further behind. A sector-wide response is needed. Here are three things the sector can do:

1. AI labs should treat nonprofit discovery as a public-interest use case. AI developers should devote attention to how nonprofit information is sourced, attributed, and corrected. At a minimum, platforms should publish practical guidance on how organizations can appear prominently and accurately in query results. They could support open standards like the Model Context Protocol and other open data access points that make it easier for trusted sector data providers to expose high-quality nonprofit information through standard interfaces. Finally, labs should diversify their nonprofit data partnerships and include intermediaries that present local, community-led, non-English, and issue-specific organizations.

2. Funders should help nonprofits address the AI discovery challenge. AI visibility adds a new layer to the overhead problem: Nonprofits need staff and operational funding to keep websites current, maintain public profiles, and publish impact data. Approaching the problem one grant at a time will not work. Funders should underwrite shared resources: common guidance, AI discovery audits, and field-level backbones that help organizations stay visible and accurately represented.

3. Intermediaries should make nonprofit information more portable and more complete. Existing sector data platforms can move beyond profiles built mainly for human search and collaborate on portable data records that can travel across AI tools. Data providers should also get more creative about sourcing. They could draw from not only IRS records and contributed profiles but also local news, referral databases, public benefit directories, partner attestations, and emerging platforms that surface smaller or newer organizations.

As more people turn to AI to decide how to respond to social problems, the technology has a chance to share better information, surface innovative problem-solvers, and spur more giving. But AI tools will realize this upside only if they help people find nonprofits that are effective, trusted, and close to the people they serve—not simply those that are easy to document. Otherwise, AI may widen the distance between organizations whose credibility is already well-established online and those who are early in their journey or whose trust dwells in community.

In June 2021, a heat dome settled over the Pacific Northwest and Portland reached 116 degrees. Nearly 100 Oregonians died of heat-related illness, most of them at home. By then, the Coalition of Communities of Color (CCC) had a long-standing partnership with the City of Portland and was collaborating with community members to design building and energy policy. A community policy workshop took place shortly after the heat dome, bringing residents’ recent experiences of extreme heat directly into the conversation. CCC asked community members what they needed to stay cool and what it was costing them. During these conversations, attendees said the extreme heat wave was stressful. They said it forced impossible choices. Residents said they felt like they were being chased by the mafia.

Community members described what they wanted their city to protect, and the values they surfaced became the HEART Standards: Health, Equitable energy, Anti-displacement, Resilience, and Temperature, a community-developed framework for shaping building policy. These standards anchor Portland’s approach to the buildings its residents live in and the climate-resilient policies designed to protect them.

This is not how climate policy usually gets made. The standard process starts with technical experts who define the problem, draft a policy, and then invite community members to react to a near-finished proposal. Portland reversed that sequence. Community members were convened before the policy existed; their expertise was used to help craft it. Residents defined the questions the city should ask and the values the policy should protect. That reversal produced broader participation and a policy grounded in community data, evidence generated by communities about their own lives. Community data can take many forms, including numbers, stories, maps, music, and art, but most importantly, it’s gathered systematically on community terms and built for action rather than neutrality. In this unique instance, community data from Portland residents on what makes a building livable became the basis for climate policy.

What Emission Numbers Alone Miss

When it comes to climate policy, greenhouse gas reduction remains its dominant metric, but emissions alone cannot show whether policies improve the daily lives of people most affected by climate change—or whether they widen existing disparities.

Climate change threatens people’s homes, their health, their neighborhoods, and their ability to remain housed. A policy optimized for emissions alone can hit its target while the frontline communities—particularly communities of color and low-income neighborhoods experiencing the greatest impacts of climate change—see little improvement in their daily lives. In the context of climate policy, community data can’t replace emissions metrics, but it can tell policy makers what those metrics cannot. The two provide a fuller picture of whether a policy is actually working to reduce emissions and benefit communities.

The clearest example of why it’s valuable to integrate community data comes from the virtual community convening CCC and its partners hosted in 2021, shortly after the Pacific Northwest heat dome. A key finding from the conversation was that people living in households that could afford a window air-conditioning unit were often prevented from installing one because their landlords prohibited it, sometimes for reasons as trivial as prioritizing aesthetics.

Working from what residents surfaced, Verde, a CCC member organization focused on environmental justice and climate resilience in low-income communities and communities of color, served as a lead lobbyist and policy developer for Oregon’s Senate Bill 1536, and led a coalition of organizations that helped it become law in 2022. The legislation established new protections for tenants seeking to use portable air conditioners and other cooling units, including window units, by limiting when landlords could prohibit them and requiring those restrictions to be justified in writing. The bill also created the Oregon Rental Home Heat Pump program, a $15 million fund to be administered by the Oregon Department of Energy that provides rebates to landlords for installing electric, energy-efficient heat pumps for heating and cooling rental units. The program did so well that two years after Senate Bill 1536 passed, the legislature directed another $4 million to bolster its funding.

The new policy addressed the actual barrier the community had identified: not the cost of cooling but the inability to use cooling units they could already afford. A policy built only from emissions data might have focused solely on appliance efficiency or reducing energy consumption, ignoring impacts on people. But because community data was central to defining the problem, Oregon has a policy that speaks to the needs of people.

Rethinking Climate Solutions

Portland’s HEART Standards and policy wins like Senate Bill 1536 are compelling examples of how community values can shape what climate policy is designed to achieve. They arose from a broader effort to rethink who gets to define climate solutions in the first place. Two initiatives carried that effort, and each did so in different ways: 1) The Build/Shift Collective changed the content of climate policy, and 2) the Climate Justice Plan for Multnomah County, which includes Portland, changed the process by which it gets made.

Build/Shift, short for Building Community, Shifting Power, brought together a group of Black, Indigenous, and other community leaders of color through a partnership convened by CCC and Verde to help shape Portland’s approach to decarbonizing buildings. Buildings are among the largest sources of greenhouse gas emissions in the United States, so a shift away from a reliance on fossil fuels for heating and cooking sources will address emissions and lead to a successful outcome for climate. However, effective climate policy must also address the unequal burdens created by racist housing policies, environmental injustice, unhealthy housing, and the rising costs of keeping a home safe and comfortable.

Build/Shift convened residents to ask how climate policy could also improve housing stability, health, affordability, and resilience. That work produced the HEART Standards, which later informed Portland’s Climate and Health Standards for buildings, including a proposal that would require landlords to make energy upgrades, such as switching from gas heating to heat pumps that also provide cooling, and a requirement that landlords disclose cooling and gas-stove health information to prospective tenants. But community-driven policymaking did not stop with Build/Shift. The same principles also shaped the development of Multnomah County’s Climate Justice Plan, a community-government partnership that pairs universal climate goals with targeted strategies to advance climate justice.

Early in the planning process, the steering committee, made up of members from 13 community-based organizations serving frontline communities, refused to organize the Climate Justice Plan around familiar government sectors such as transportation, buildings, and energy. Those categories merely reflected how government agencies divided responsibility, not how residents experienced the impacts of climate change. Communities described climate impacts through housing quality and availability, health, affordability, mobility, neighborhood safety, cultural belonging, and economic opportunity. Reorganizing the plan around those lived realities made it easier to develop solutions that connected housing stability, transportation, workforce development, public health, and climate resilience instead of treating them as separate policy challenges. For example, the plan’s goals are written from residents’ perspectives, including that every community member has access to affordable, reliable, and safe transit, biking, and pedestrian infrastructure; has the opportunity to build wealth and find green jobs; and has access to affordable, nutritious, culturally specific food and food practices, such as cultivating wapato and gathering lamprey, which are traditional foodways of the region’s Indigenous people.

The planning process reflected the same spirit. Community members helped define objectives, review drafts, refine recommendations, and shape priorities before proposals entered county government. Engineers, planners, and policy specialists still modeled emissions, evaluated feasibility, and drafted policy language. But what changed was the sequence of events. Technical expertise responded to questions communities helped define.

What Counts as Community-Driven, and What Doesn’t

Community-driven policymaking emerged because practitioners kept finding that decisions made on communities’ terms were the ones that worked and the ones that lasted. Also, asking people to weigh in after the important choices had already been made produced policies that satisfied a process requirement and little else.

For example, Portland’s 2015 Climate Action Plan brought an equity lens to a plan whose overall infrastructure had already been set. It represented meaningful progress at the time, but today the standard is higher. Community-driven policymaking requires government agencies and policy makers to involve communities while problems are still being defined, issues are still being debated, and success is yet to be determined. The goal is to ensure that community knowledge and expertise help shape the policy at the outset.

That shift in approach reflects a broader change in how expertise itself is understood. For decades, technical knowledge has been privileged and deferred to in some policymaking circles. This is not to say policy gets decided on technical merit; ideology, relationships, and individual agendas do far more of that work, at every level of government. But technical fluency has long determined whose claims are taken seriously enough to enter the room at all, while lived experience was treated as anecdotal, occasionally useful for illustrating a problem but not for solving one. Community-driven policymaking challenges and disrupts that hierarchy.

Residents who live with a problem possess knowledge that technical models lack. That is not a flaw in modeling; a model reflects the variables its designers thought to include, and residents have rarely been in the room when those choices were made. A tenant who has spent three summers in an apartment a landlord refuses to cool understands something about heat resilience that no emissions model captures. Excluding that knowledge does not make climate policy more rigorous. It makes it less accurate and less effective.

Recognizing lived experience as expertise is only worthwhile if policymaking can incorporate it. A values-first process provides that pathway by beginning with questions about people’s lived experience before introducing technical solutions or policy categories. Rather than sorting people into the fluent and the excluded, it asks questions that residents can answer from their own lives. What do you love about the buildings you spend time in? What does it cost to keep your home comfortable? The answers emerge as shared values that can then be translated into standards and policy.

Where It Was Genuinely Hard

The city of Portland’s embrace of community-driven policymaking didn’t happen overnight or because public agencies suddenly decided to listen more carefully. It happened because they were willing, at least in specific moments, to change how decisions were made. Despite collaborative willingness, the process was not without its frictions. Some challenges were political. Others were institutional. Still others were deeply human.

Timing compounded the challenge. Community-driven policymaking does not unfold in a political vacuum. An earlier city council may well have advanced the building standards. But an election shifted the political landscape, producing a council more closely aligned with business and industry priorities, and the work stalled. Build/Shift stopped meeting. Today, a newly configured council has reopened the possibility of moving the building standards forward. This lesson is an uncomfortable one: Even the strongest community-driven process cannot overcome political constraints. Sometimes success depends not only on building the right policy, but on recognizing and acting within the window when adoption is possible.

Not everyone welcomed the reversal in sequencing. Utilities and other industry stakeholders, accustomed to shaping policy from the outset and independently of community preferences, bristled at being brought into the process later—precisely the position frontline communities have traditionally occupied. Mainstream environmental organizations, by contrast, largely accepted the community-first approach. The differing reactions underscored that shifting who enters the room first inevitably reshapes long-established expectations about whose expertise receives priority.

Perhaps the most surprising challenge came from the communities themselves. Asking residents to co-create policy rather than simply react to it represented a fundamentally different civic role. Residents who had spent years experiencing government as something done to them—not with them—did not always feel comfortable exercising the authority they were being offered. The work required continual reassurance that the invitation to shape priorities was genuine. Community-driven policymaking requires building institutional capacity and community confidence at the same time.

One anticipated obstacle, however, never materialized. CCC compensated Build/Shift members at consultant rates and paid community members to participate in meetings and convenings. Instead of resisting the practice, city partners helped connect the coalition with funders, and philanthropic partners supported treating community expertise as knowledge worthy of compensation. As the City of Portland understood, and as all organizations should, paying residents for their insights shouldn’t be controversial when organizations intentionally design participation as shared governance.

A Model Others Can Use—And Why It Matters Now

The experiences of CCC, the City of Portland, and Multnomah County reveal that a policy can be technically sound and still fail the people it’s meant to serve when they have no say in shaping it. The only way to know what they need is to ask them. Because local and state governments control the sequence through which policy gets made, that lesson points to a small set of practices they can adopt to make community expertise part of how policy is designed.

First, bring communities into policymaking before problems and solutions have already been defined. Second, begin with values rather than technical language so residents can define what success should look like before weighing in on how to achieve it. Third, acknowledge past harms openly instead of assuming trust. Finally, budget for community participation as a standing cost of governance and treat community organizations as sources of policy expertise rather than outreach channels.

Structural reforms in government matter as well. Portland’s move to district-based representation and ranked-choice voting produced a city council that more closely reflected the communities affected by climate policy, including stronger representation from East Portland, an area of the city that is historically neglected and underinvested in. Multnomah County voters also approved ranked-choice voting for county offices. Community-driven policymaking depends on relationships, but it is also shaped by institutions. The rules governing representation, participation, and political accountability influence which kinds of policymaking become possible.

That matters because climate policymaking is entering a period of extraordinary instability. The United States has withdrawn from the Paris Agreement for the second time, making meaningful federal climate leadership unlikely for the foreseeable future. Meanwhile, communities are simultaneously confronting climate disruption, housing affordability, economic uncertainty, and declining public trust. Government budgets are tightening even as needs continue to grow.

But again, Portland offers a reason for optimism, and this is in part due to the ways community-driven policymaking has produced constituencies that understand the work they helped build. Community-driven policymaking is often described as a more equitable way to govern. Portland suggests it is also a better way to produce and use community data. The knowledge communities needed was never missing. The challenge has always been whether public institutions were willing to recognize it as evidence and build policy around it.

You walk into a hospital, and no one asks what you do for a living, where you are from, or how you intend to cover your bill. The hospital’s founding provisions instruct staff not to even “hint” at a patient’s inability to pay. If you feel anxiety, you will not be left alone with it: Salaried musicians play each evening to lift patients’ spirits. There is no discharge date on your admission, because no one has decided in advance how long recovering should take; the provisions simply require that the hospital keep patients “until they are completely recovered.” When you leave, you could be given clothes and a cash sum to help resume your life.

This sounds like an idealistic proposal, but it is not. It is a compressed account of the Bimaristan al-Mansuri, a hospital built in Cairo in 1284 by the Mamluk sultan al-Mansur Qalawun. The hospital was sustained by a waqf, a form of charitable endowment that emerged in the early Islamic period. The waqf was a civic backbone in Mamluk Cairo, and Muslim-majority societies continue to leverage it today. The Bimaristan is worth examining not as utopian nostalgia—it had its own limitations and failures—but because its design logic belongs to a different philanthropic tradition, and that difference makes some of the assumptions of today’s metrics-driven philanthropy easier to see.

Philanthropy as Micro-Level Optimization

In her recent SSIR article, “Why Don’t Philanthropists Build Anymore?”, Sarah Cone argues that today’s wealthiest donors have largely stopped building new institutions, and that a culture trained on “tractable interventions, short feedback loops, and quantifiable outputs” underinvests in institutions whose benefits are diffuse and slow to appear. I agree, but it is worth pushing the argument upstream: The measurement norm shapes not only which institutions get funding, but which ones the field imagines at all.

Much of modern philanthropy begins from scarcity. It asks: Given a finite pool of resources, what is the most we can accomplish? But budget constraints need not constrain imagination. The pool is not a natural constant; it can grow, change structure, or join other sources of long-term support.

That scarcity logic found a particularly powerful instrument in the randomized controlled trial. But a trial needs its object to have boundaries, be capable of randomization, and be measurable against a counterfactual, and that requirement can shape not only what researchers evaluate, but also what philanthropy conceives as fundable. A hospital that treats everyone, with no eligibility test and no discharge date, is hard to express as a single treatment effect or to justify on underlying efficiency grounds. The difficulty of measuring it can become its own disqualification.

Some recent philanthropic movements have pushed back against this narrowness by relocating the target of intervention. Systems change philanthropy moves it from an individual’s outcome to the policies, markets, and institutions that produce outcomes at scale, and place-based philanthropy applies a similar systems logic geographically. Both broaden the unit of analysis, but they still generally start from a problem and ask what change would address it.

But other cases ask a different starting question: What should people be able to count on in order to live well and flourish, independent of any specific problem needing a fix. Rather than treating society as a collection of individual needs to address one intervention at a time, provision logic asks what people should be able to encounter, and what kinds of relationships, dignity, and shared experience those provisions make possible.

Generative Philanthropy

This provision logic belongs to a category worth naming; I call it “generative philanthropy.” Allocative approaches to philanthropy take a given pool of resources and ask how to distribute it most efficiently. They let the size of the budget determine the size of the ambition and how it is delivered. Even when the pool of resources grows, it grows to buy more of whatever unit is the cheapest per outcome. Generative philanthropy, as I use it, inverts that order. It starts by imagining what people should be able to count on to live well and flourish, and it lets that standard determine what gets provided. Then it creates the resources to match. A giver can endow assets, liquid or physical, so that returns sustain giving in perpetuity; draw on contributions from other institutions; or assemble other donors, large or small, to keep something running beyond a single gift.

The Bimaristan described above was sustained by precisely the kind of institutional mechanism that makes generative provision possible. The waqf is fundamentally a legal and financial mechanism. In Arabic, the word means “stopping”: A founder takes income-producing property, such as land, shops, or rental buildings, out of private circulation and dedicates its revenues to a named purpose in perpetuity. The endowed asset is generally inalienable so that its productive capacity can continue serving that purpose. The instruments themselves keep evolving; contemporary waqf can take the form of endowed company shares, government bonds, pooled cash, or other financial assets whose returns support public provisions.

The mechanism suits ideas central to Islamic giving. Sadaqa jariya, or “ongoing charity,” holds that a gift which continues to benefit others is rewarding for the giver, even after death. The Bimaristan treated patients for more than five centuries, and its site is still used as an eye clinic today. Charity is also meant to protect the recipient’s dignity, never becoming an occasion for humiliation, indebtedness, or display, which helps explain why the Bimaristan took a stance against “hints” at payment. Giving is expected to embody ihsan—the act of doing anything well, generously, and with excellence, rather than minimally. The measure of a well-given gift is that it is the same as or better than what the giver would want for themselves. Together, these ideas point toward an expansive conception of obligation. In the hospital case, the question is not simply how to remedy an ailment efficiently, but to provide what a person needs to recover. There is a striking resonance with Amartya Sen’s much later capability approach, which evaluates well-being by what people are able to do and be.

The waqf gave that expansive conception of obligation a durable financial form. The giving not only funds a provision, it creates a structure capable of continuing to fund it on its own.

Waqf founders and contributors are historically not limited to sultans and emirs. Merchants, scholars, women, and Christian and Jewish communities living under Islamic rule all participated. While scaled or lasting giving is often assumed to be a matter for billionaires, the waqf is a form that many could take part in, either with their own dedicated fund or as a small contribution to an existing fund.

The waqf system produced, and still produces, an enormous range of institutions and provisions, built around the dedication of assets to public benefit. On the non-institutional front, a student’s tuition, a patient’s medical costs, or access to a particular medical capability can all become objects of endowed giving. The contemporary Health Waqf Fund in Malaysia, for example, is designed to cover the cost of molecular testing to determine whether cancer patients can receive targeted therapies, with the aim of giving patients access to testing regardless of their ability to pay. The significance is easy to miss because the technology itself is no longer extraordinary, but even in high-income countries, access to advanced molecular testing remains uneven, with coverage varying by payer, test, and location. The waqf treats access to the capability itself as something worth making broadly available.

The same logic can produce physical places. From roughly the 14^th to the 19^th century, sabil-kuttabs—public drinking fountains with small Quranic schools stacked directly above them—were a particularly popular choice in Cairo. These joined two very different goods, water and literacy, and offered them to whoever showed up, with no test of need. The fountains were deliberately beautiful and easily accessible, often curving out into a path or sitting in its center with openings on all sides. Carved stone, marble, glazed tile, and the play of light and moving water was part of the offering and turned the act of getting water into an experience beyond function. The school upstairs taught children to read and recite the Quran, making literacy itself a provision rather than treating education principally as a route into the labor market. These were a different object from what education philanthropy tends to measure today, where the outcome is a score or a graduation rate aimed at ultimate employment and income.

Another form of generative philanthropy, in the sense that it starts with asking what should exist and takes an expansive view, shows up in Andrew Carnegie’s library philanthropy centuries later. Carnegie credited his own ability to learn and flourish to his access to a private library and described it as the reason he sought to boost access. Between 1883 and 1929, he funded more than 2,500 public libraries, some 1,700 of them in the United States, but he rarely simply paid for a building outright. His standard offer required that the receiving town supply the land and, importantly, pass a tax or otherwise guarantee ongoing public funding to staff and maintain the library once it opened. Carnegie was explicit about why, drawing a hard line between what he called philanthropy and mere charity. Carnegie used a one-time construction grant to convert local governments into permanent co-funders, effectively demonstrating an American model of tax-supported public libraries as a byproduct of how he structured his gifts. He was part of a wave of Gilded Age donors who built rather than gave—Cone’s essay cites Rockefeller’s research institute, Mellon’s National Gallery, and Rosenwald’s schools.

Provision logic is not only historical. Sir Magdi Yacoub, an Egyptian heart surgeon, returned to Egypt after decades of work in the United Kingdom and built a world-class heart center not in Cairo but south in Aswan, within reach of Egypt’s poorest communities. Since 2009, the Aswan Heart Centre has performed complex cardiac surgery, much of it on children, free of charge, while training a generation of Egyptian clinicians and running its own research program, funded by donations. And when the center drew more patients, from across and outside of Egypt, than it could serve, the answer was not to dilute the standard of care but to call on other donors and set out to build a second, larger center outside of Cairo.

These founders imagined something beyond the ordinary. Few towns in 1883 regarded a public library as a necessity, yet Carnegie’s libraries ultimately carried the same civic register as sabil-kuttabs, and more than a century later, several hundred of the original buildings are still functioning as libraries. Sir Magdi Yacoub’s imagination started where the Bimaristan did: with what a sick person should be able to count on.

These examples arrived at the same sequencing from continents and centuries apart, which is itself worth noticing. The means were, in an important sense, divergent, with some self-funding in perpetuity, others leveraging a single gift into someone else’s permanent obligation, and still others sustained through ongoing giving. But they started from imagining what should exist for flourishing lives and societies, then built the resources to make it possible.

Of course, mechanisms like the waqf are not immune to failures. Endowments can grow rigid under founders’ unrevisable terms, people indifferent to the purpose can capture administration, and changing circumstances (like piped water and mass schooling in the case of the sabil-kuttabs) can leave funds that don’t adapt obsolete. Nor is any of this an argument for abandoning measurement. Ignoring whether a program works has its own long history of donor vanity and wasted money. Evidence can tell you whether something works. But it should not necessarily shape what philanthropy is willing to imagine providing. Generative philanthropy reveals what gets lost when the process of addressing societal needs is reversed—when rigorous, isolable, comparable evidence is the entry price for an idea. Careful evaluation earns its place when a good’s value is genuinely unclear. But shaping a solution until it fits the accounting already on hand is its own kind of distortion in imagining the possible. Philanthropy’s harder task is not choosing between building and solving. It is asking what people and societies actually need to live well and flourish, before asking how to prove that it is worth building.

When the data-driven collective impact nonprofit, Baltimore’s Promise, set out to map the city’s youth programming, the numbers seemed to tell a clear story: For every four opportunities available to elementary school-aged children, there was only one for older youth, ages 19-24. So the fix seemed obvious: raise money, provide more programs for teenagers and young adults, done.

Before acting, Baltimore’s Promise took the finding to the people. Through its Youth Opportunities Landscape project, the organization held 19 group conversations that included 161 young people, parents, and caregivers. More programs would not have fixed the problem. Instead, Baltimore’s Promise learned that existing youth programs were often unavailable: Older youth described long bus rides of up to two hours to reach a program site. Many were parents themselves or primary caregivers for younger siblings with no way of arranging sibling care. Others were already working, and programs built around a school-day schedule could not accommodate them. The issue wasn’t just a supply or access problem; it was whether opportunities were available, realistically accessible, and aligned with what young people wanted and needed.

The map data was insufficient because it only showed where programs were located, but not why the existing programs went unused. Only the community knew that. And their insights changed what happened next: When programs across the city applied for a grant from the Baltimore Summer Funding Collaborative, Baltimore’s Promise ensured that the application and scoring rubric prioritized cost, transportation, sibling care, and work schedule flexibility in their selection criteria. Parents and youth ages 14 to 24 served as community reviewers, scoring applications and guiding how the Collaborative distributed more than $5 million. Baltimore’s Promise paid community reviewers and provided transportation and childcare, thoughtfully removing from its own process barriers young people had associated with inaccessible programs. The Baltimore Children and Youth Fund then joined the Collaborative the following year to provide an additional $2 million for programs led by people of color and serving youth ages 14 to 24, which, with other contributions, lifted funding for programs focused on older youth by 82 percent. By 2023, older youth had gained ground. Elementary school-aged children now had 2.3 opportunities for every one available to older youth, down from four to one.

This experience illustrates the positive benefits that can occur when communities have opportunities to contribute data on their own terms and can use it to make critical decisions that impact their lives. When the people most affected by a problem are treated as sources of credible evidence, are able to govern how the information they share is used, and can ultimately guide decisions, it helps ensure that dominant institutions (e.g., governments, for-profit companies, universities, hospitals, foundations, and other organizations that have historically controlled resources and decision-making) are less likely to misdiagnose problems, invest in ineffective solutions, or create programs people can’t use. Community governance makes this possible.

Community governance is a process through which community members collectively direct and determine decisions that affect them. Oftentimes, at the center of those decisions is civic data: the information communities collectively generate and that institutions use to allocate resources, shape policy, and govern public life. Communities can sometimes govern themselves and make decisions independently. Other times, they share authority with governments or other institutions through collaborative governance, a specific type of community governance. The structure varies with the community, the location of its data, its autonomy and capacity, and the relationships and organizations at play.

The stakes are not evenly distributed. Taxes—a form of civic data—provide a useful example: Black communities have long paid taxes into public systems while being simultaneously and systematically excluded from the decisions that governed how these resources were used, often financing the very segregation and disinvestment imposed upon them. Community governance helps correct that imbalance by restoring authority over decisions made with public resources to the communities most affected by them.

Communities in Baltimore City, Pittsburgh, Portland, Oregon, and Tucson, Arizona, are applying that principle in different ways. Each has built a governance process around civic data that reflects local priorities, relationships, and capacity. The result is the same: When communities govern their own data and the decisions made with it, the outcomes are more effective, more durable, and more desirable.

What Community Governance Is Not

Gathering information and filing it away—or using it to justify decisions already in motion—is not community governance. A focus group, a listening session, or a survey you might consult later are simply consultations. They can be done well or badly, but none of them transfer decision-making authority. Consultation merely gathers input. Governance gives communities a critical role in shaping what happens. When community governance is inauthentic, dominant institutions claim one-sided decisions were “shared,” when in actuality, the communities involved are tokenized and denied real decision-making power.

What real community governance looks like in practice can vary, but it must always involve sharing authority and decision-making power with community members and residents. For example, Baltimore’s Promise regularly convenes a Community Research and Action Committee (C-RAC), a body of Baltimore residents, including young people, that helps direct the city’s Youth Data Hub, an integrated data system linking school, health, and program records to track how young people are faring. The C-RAC guides processes, requests analyses, and decides how findings are made accessible and to whom.

In Pittsburgh’s Larimer neighborhood, residents participating in a Neighborhood Power-Building Project (NPP) process set their own meeting schedule, choose the issues they will prioritize, and walk the neighborhood with city officials to identify hazards to walkability and road safety. They ultimately co-authored a Built Environment Action Plan (BEAP), a community-led initiative driven by the Black Equity Coalition and the Larimer Consensus Group to tackle local disinvestment and health disparities. NPP facilitators were explicit that their role was not to direct the process but to support residents in directing it themselves.

In Arizona, an advisory council at the Tucson Indian Center determines what information is worth collecting in the first place, not simply how findings are reported, so that the data serves the community’s own priorities for fostering employment opportunities and advancing economic mobility. Portland’s engagement in climate justice work moves community governance even earlier in the process, bringing community members together to define problems long before governments begin drafting policy responses.

Although these communities have different structures, they function with the same principle in mind: Communities set the terms. The distinction matters because of a persistent and paternalistic assumption that communities do not know what they need. This belief wrongly assumes that communities lack the know-how to co-author a plan or lack the expertise to govern. The demand for technical expertise is often used to scare community members away from the material or to justify leaving them out when the subject really is not that complicated. But that assumption is wrong, harmful, and often self-serving. Community members do not know less than credentialed experts. Their expertise is different, grounded in a lived experience that those with credentials often do not have. Data work that fails to center this kind of experiential knowledge tends to produce solutions with little chance of success.

Earlier community engagement frameworks often described their highest aspiration as “empowering” communities, a term that implies power is a gift that dominant institutions bestow rather than something the community already holds. But power that a dominant institution confers can be rationed or withdrawn at any time. In these frameworks, the inherent power within a community goes unrecognized, as the dominant institution is considered the authority in the relationship. This is why more contemporary frameworks instead emphasize community leadership, self-determination, and shared governance. Community governance starts from a different premise: Communities already possess the power, authority, and expertise to shape decisions that affect them.

Finding Your Place on the Spectrum

The question then: How do organizations know where they are when it comes to facilitating an authentic approach to community governance, and what can they do if they want to improve? One useful answer comes from the Spectrum of Community Engagement to Ownership, developed by Rosa González of Facilitating Power. It arranges an institution-community relationship along a line of increasing community governance and authority: from ignore, to inform, to consult, to involve, to co-govern, to defer to (see figure below). At the shallow end, the dominant institution acts alone or announces what it has decided. In the middle, it asks for input and takes it into account. At the far end, the two share decision-making authority (co-govern), or the institution defers to community leadership outright (defer to).

Two features of the spectrum matter in practice: The first is that movement along it is incremental and iterative. Dominant institutions do not leap from marginalizing communities to supporting full community leadership. Each increment of collaboration and shared authority moves you along the spectrum. But the journey is not always one of linear progress. Trust can be lost as well as built. Failing to act on feedback, making meetings less accessible, or letting the process go opaque moves an institution back down the spectrum because the relationship symbolized by the spectrum is dynamic, ever evolving, and in need of constant tending.

The second is that a single organization rarely sits at a single point. Different organizational teams, initiatives, and even different components of the same initiative can sit at different places on the spectrum depending on the task, the funding, and the capacity available. For example, Baltimore’s Promise operates at the co-govern stage because they have a community advisory board that holds equal voting power with the board of directors over the annual budget. Its Youth Grantmakers initiative, a youth-led body that controlled the allocation of over $1 million, sits at “defer to.”

The point of locating yourself on the spectrum is to know, step by step, where you are and where you mean to go. The most useful time to do this is while a project is still being designed. As you plan, map every point where you intend to hear from communities and ask who is constructing each of those access points.

Did the community set the meeting time, co-create the agenda, or shape guiding questions, or only answer them? Then ask what will be done with what you hear, and how will it be communicated back? An access point that feeds nothing, and is never explained, is theater regardless of how it looks on an organizational chart. And you don’t have to redesign everything at once. Identify one decision, in one initiative, where you can share more authority now, and start there.

Don’t Talk Yourself Out of It

If the further end of the spectrum produces better results, why do so few institutions get there? In our experience, part of what might be stopping them is a misreading of what community governance requires. Some assume it means that communities must always own the decision outright. Faced with the distance between that and where they currently sit, some organizations conclude they can’t get there, and do nothing, or they tokenize communities and call it collaboration.

But a possible cause is even simpler: Dominant institutions are often unwilling to commit the time, money, and accountability that shared decision-making requires, and the all-or-nothing framing gives them a reason not to start. Budget constraints, internal power imbalances, and shifting politics also limit what institutions can commit, though none of these excuse standing still.

However, institutions can make progress toward facilitating genuine community governance processes by keeping two considerations in mind. The first is a caution against moving too fast. An organization that leaps from nothing to full community ownership overnight will almost certainly mishandle it, because the trust and credibility are not yet there. Governance maturity is built over time, not declared into existence. The second is a caution against the opposite assumption—that full community ownership of every decision is the only legitimate form of governance. Not every decision calls for the same degree of community authority. A community has little stake in how a city processes its internal invoices. It has every stake in the governance of its civic data: the information about its streets, schools, health, and other conditions that shape public decisions. Decisions about civic data belong at the far end of the spectrum, where dominant institutions co-govern with communities or defer to them.

The point is not to maximize community authority in every circumstance. It is a spectrum, and the useful question is not “Have we done it?” but “Where are we on the journey thus far, and what’s the next step toward making our approach more authentic and community-centered?”

Although community governance produces more durable solutions and stronger community buy-in, it does have a cost: time, energy, resources, control, and professional humility. But the alternative is more expensive. Decisions made on a tight timeline and without essential community data and expertise that can surface root problems tend to produce solutions that are ineffective or even harmful. The up-front investment is often the most cost-effective path because it’s the surest way to identify the real problem—and identify the right solution—the first time around.

What More Authentic Community Governance Demands

Authentic community governance means investing the time to expand community capacity in lieu of inviting people into a meeting to merely rubber-stamp decisions they had little opportunity to shape. Institutions and communities should also be open to learning throughout the process of collaborating. For example, community members can gain insights about the intricacies of internal agency dynamics, budgeting and procurement processes, and data systems, learning well enough to hold their own in decisions that affect them. Practitioners, researchers, and government staff can gain insights about residents’ experiences, learning to value their knowledge as trusted evidence that’s essential to understand the depth of a problem and what’s needed to work toward a solution.

Authentic community governance also requires investing in resources and supports that allow for meaningful community participation. That means providing stipends, childcare, transportation, flexible meeting hours, interpretation, meals, and the practical supports that ensure people can actually participate in governance processes. Governance approaches that overlook these realities end up only involving people who need the fewest accommodations but then mistake that convenience—and their contributions—as symbolic of true community representation.

Together, these investments can create the conditions in which trust can grow over time through shared learning, practical support, repeated follow-through, and opportunities for communities to shape outcomes in material ways they can see. The Larimer community’s work in Pittsburgh illustrates what those investments can produce. For years, drivers used residential streets as a cut-through to downtown, reaching speeds as high as 70 miles per hour. Residents had long known that speeding in the area increased the risk of fatalities and endangered children in their neighborhood. City data confirmed the problem, yet officials said traffic-calming measures could not be funded for a year or more. Through the NPP process, residents organized around the evidence, determined that traffic calming should become a neighborhood priority, worked with their community liaison, and brought both the data and their recommendations directly to their councilman. Instead of a year, funding for improvements to slow traffic, including speed bumps, was approved within weeks. Just as important, the process created an opportunity for residents to move beyond reporting a problem to helping determine how public evidence can translate into public action.

As residents began seeing tangible results—improved street lighting, speed bumps, an approved street mural, and regular attendance by a councilmember at meetings—they also began seeing their community data differently. In nearly every workshop, they returned to one statistic presented early in the project: Average life expectancy in Larimer was 62 years, compared with 85 years in a neighborhood less than a quarter mile away across a bridge. The number became emblematic evidence of inequity and a shared impetus for understanding why investments in lighting, traffic safety, housing, and neighborhood conditions mattered, and why residents themselves needed to shape the decisions that followed.

From Principle to Practice

Fostering community governance is not the responsibility of any one institution or sector. Different actors shape different parts of the process, and each has a role to play in making shared decision-making possible.

Government partners should bring communities into the process before priorities have been established rather than after plans have already been drafted. They can adopt frameworks like the Spectrum of Community Engagement to Ownership (above) as standard practice. Government partners should also compensate community members for their time, and provide the childcare, transportation, interpretation, and scheduling flexibility that determine who can participate at all. And they can build community timelines into project plans rather than treating urgency as an excuse to bypass participation.

Funders should treat governance infrastructure as a legitimate program investment rather than administrative overhead. That includes funding staffing, relationship-building, stipends, childcare, transportation, accessibility supports, interpretation, and meeting space. They can also fund the training that lets residents read a budget, a dataset, or a policy draft well enough to argue with it, and the staff time inside institutions to learn how to share a decision.

Practitioners should begin with an honest self-audit. Map every place where your organization hears from community members. Locate each of those moments on the Spectrum of Community Engagement to Ownership. Next, ask who designed the engagement process, who framed the questions, what decisions community members can influence, what changed because of what they shared, and how those decisions were communicated back. Then ask: What is the next deliberate step toward sharing a little more decision-making power?

Across these roles, the goal is to build community governance that can withstand changing administrations, shifting funding priorities, and the end of any single program. When genuinely built and continually cultivated, relationships can become vital infrastructure that allows communities and institutions to keep solving problems together long after any single grant or administration has passed.

Ultimately, community governance of data is not a box that an institution checks. It is not a committee added to satisfy a grant requirement or a listening session held before returning to business as usual. It’s an ongoing relationship that institutions cultivate, initiative by initiative, decision by decision, over time. Our experiences in Baltimore City, Pittsburgh, Portland, and Tucson have shown us that community governance changes more than who has influence over public decisions. It changes the quality of the evidence those decisions are built on. Data can identify that a problem exists. But only communities and community data can help explain why a problem exists and, most importantly, what can be done to solve it.

We love a good impact story. The story of the foundation that designed a new innovative environmental program. The entrepreneur that scaled a social innovation. The new catalytic capital fund. But I have spent enough time in this field to recognize that much of this work, for all its good intentions and often very real impact, can also end up preserving the status quo, or at least leaving it unchanged. That status quo is an economy capable of generating extraordinary wealth, yet one that continues to distribute it so unevenly that large parts of society are being left behind, with the most vulnerable furthest behind of all. It is also an economy generating growing frustration and discontent with how it works, and for whom.

This means that, sometimes, the most impactful thing many of us can do is simply to pay our taxes. It also means that encouraging, advocating for, and supporting adequate taxation might be the most important thing the social sector as a whole can put its energy into.

Saying this can feel almost too simple. Yet much of the impact sector operates on the understanding that governments often face severe resource and operational constraints when addressing complex social and environmental issues. As a result, private capital is naturally expected to bridge the divide, with foundations serving as crucial catalysts and conveners. This framework is widely recognized as the “Sustainable Development Goals funding gap.”

But why does the gap exist in the first place? Why is the solution always more private capital rather than stronger public institutions?

In The Entrepreneurial State, economist Mariana Mazzucato demonstrates that many of the technologies that we associate with private genius—the internet, GPS, green technology—were all funded by the US government, long before a single venture capitalist showed interest. It is “the state not the private sector that has kick-started and developed the engine of growth,” as Mazzucato argues, “because of its willingness to take risk in areas where the private sector has been too risk averse.” But even initiatives that encourage governments to take on greater risk in support of innovation rarely ensure that society shares in the upside, a dynamic Mazzucato describes as the socialisation of costs and risk and the privatisation of profits.

Consider SpaceX. When three failed launches left it near bankruptcy, what saved it was not another venture round but NASA becoming an early customer, providing the patient funding and demand certainty that private markets wouldn’t. But after the public de-risked the company, it took no equity; as its valuation climbed into the hundreds of billions, the upside accrued almost entirely to private shareholders. After the public bore the risk, it captured almost none of the reward. And had the public taken even a small equity position alongside its early support, that same success would now be helping to fund the public budget rather than bypassing it.

This prompts the obvious question: If there is public money to de-risk a rocket company, why not to resource a hospital?

Disruption Is Not Social Progress

The consequences of over-relying on private solutions, often driven by technological disruption, while under-resourcing public systems are not theoretical. During a recent trip to Washington DC, I watched an Uber fare for the same short journey fluctuate between $12 and $60 within a two-hour window. But no public bus has ever charged a passenger five times more for being in a hurry. And Uber benefits from public transport chaos: Strikes, engineering works, infrastructural delays, and closures are opportunities for higher earnings. The failure of the public system is, quite literally, built into the business model. And once Uber no longer needed to subsidize its fare, the fares went up. A recent Consumer Reports has also found that Uber and Lyft are now taking between 43 and 49.5 percent of each fare, even as a well-funded public transit system remains the most cost-effective, equitable, and scalable urban mobility solution ever designed. A metro line serves millions, at the same price, in any weather. An app serves those who can afford whatever the algorithm decides to charge them.

The same logic appears in sectors that are far more consequential than transport, particularly those traditionally regarded as impact sectors. For example, BYJU’S, backed by The Chan Zuckerberg Initiative and valued at $22 billion, once hailed as the future of learning and celebrated as proof that private capital could democratise education across the Global South. Yet much of its growth was driven by aggressive sales tactics, including the marketing of expensive learning packages to lower-income families through financing arrangements many struggled to understand. By 2025, the company had entered insolvency proceedings. Several early investors exited before the collapse. The families who took on loans to purchase educational packages had no such option.

The question is not whether private capital can create value. It can. The question is whether it creates enough public value to justify the resources, attention, and legitimacy we continue to grant it, while neglecting the institutions that were designed to serve everyone. And when essential services become investment opportunities, success is often measured in growth, margins, and returns rather than access, quality, or equity.

The Overlooked Gap

According to the IRS, approximately $696 billion in federal taxes in the US are not paid voluntarily and on time each year due to non-filing, underreporting, and underpayment, representing a compliance shortfall of roughly 15 percent.

If we apply even that 15 percent shortfall to global tax revenues—which the IMF estimates at roughly $20 trillion annually—the result is an implied global tax gap of approximately $3 trillion per year. Of course, this is an extrapolation, and compliance varies enormously across countries. But it highlights the scale of revenue likely lost, simply, through non-compliance. A structural funding constraint may be, at least in part, a challenge of tax administration, transparency, and political choice.

In addition to non-compliance, a substantial share of revenue is lost through practices that are entirely legal. Multinational corporations shift profits to low-tax jurisdictions, for example, which the Tax Justice Network estimates costs governments roughly $348 billion a year. Wealthy individuals defer taxation almost indefinitely by holding appreciating assets rather than selling them, borrowing against the gains. And philanthropy itself is at least partly publicly financed too. The charitable deduction is a formal government expenditure, and donor-advised funds compound the problem: DAFs hold over $230 billion in the United States, with no legal distribution deadline, thereby generating immediate tax deductions even as the money sits, grows tax-free, and might never reach a beneficiary.

Even when philanthropic capital does flow, a high-net-worth individual who, for example, reduces their tax liability by $50 million and directs $5 million of the savings toward an education fund has not made a $5 million contribution to social good. They have made a $45 million withdrawal from the public systems that are trying to help the most vulnerable. It is akin to diverting water from a shared reservoir, then being praised for donating some of it back during a drought.

When we increasingly ask private capital to solve problems created by decades of under-investment in public goods, the problem is not just structural. It is also cultural. "Tax avoidance is a key skill to building wealth," as Scott Galloway, a NYU professor and entrepreneur, said on a recent podcast. The fact that Galloway also supports higher taxes on the wealthy is precisely the point. When even those who understand the dysfunction most clearly feel obliged to counsel tax minimization, we have normalized a posture toward taxation, reinforcing the argument that only naive people pay taxes.

What the Impact Sector Can Change

The impact sector attracts some of the most genuinely committed people, who work on the world’s most urgent problems, along with serious capital and intellectual energy. The uncomfortable possibility is that much of the sector is trying to repair, privately and at a fraction of the scale required, the very public capacity that under-taxation has quietly weakened.

So, what should we do?

• Treat tax compliance as an impact metric. ESG frameworks already assess corporate tax governance, but we should apply the same lens to investors, fund managers and intermediaries. A Luxembourg fund managing capital from a Cayman entity for a family office paying 8 percent effective tax is not impact neutral. Its structure is part of its impact footprint and should be disclosed and measured. Also, donor-advised funds deserve the same scrutiny as blended finance vehicles. The sector demands additionality evidence for a $10 million first-loss tranche, yet asks little about $230 billion sitting in DAFs with no distribution timeline or accountability for outcomes.
• Hold governments accountable for how taxes are spent. Activist hedge funds take positions in companies and push for governance reforms, better capital allocation, and transparency on returns. There is no structural reason the same logic cannot apply to public spending. Impact investors, institutional asset owners, and development finance institutions already engage governments on policy. That engagement could explicitly include tax enforcement, public expenditure quality, and the social returns of government programmes. The leverage is potentially far larger. A pension fund that shifts its government engagement from macroeconomic stability to public spending accountability is deploying its influence at a scale no blended finance vehicle can match.
• Reframe the narrative. The sector has significant communication infrastructure: convenings, publications, rankings and annual reviews. Using that infrastructure to make the link between tax avoidance and the SDG financing gap visible is itself an act of systems change. It means saying clearly that the gap we are mobilising private capital to fill is partly a gap that private capital helped create. The sector should also build a positive narrative around tax. Paying tax is not just a compliance issue. It is a contribution to the public systems, institutions and services that make inclusive and sustainable development possible.
• Build for the public, not around it. The impact sector must go beyond financing alternatives to public systems. Instead, it should invest directly in public goods by backing the entrepreneurs, tools, and institutions that strengthen state capacity and essential services, from tax collection, procurement, and municipal finance to public education, healthcare, and affordable housing.
• Help governments build revenue-generating assets. Taxation is essential, but it is not the only route to funding public goods. Sovereign wealth funds, like Norway’s Government Pension Fund Global, show what becomes possible when states retain ownership of productive assets and use the returns to help finance public budget, creating fiscal space for universal healthcare, free higher education, and a strong social safety net, without relying on income tax alone. The Norway fund also uses active ownership, excluding companies that fail environmental and social standards and engaging portfolio companies on governance reform. The same principle can work below the sovereign level through community wealth funds, municipal investment vehicles, public-private enterprises with social-dividend mandates, and governments acting as anchor investors.

A More Honest Impact Strategy

This is not a retreat from innovation, but a shift in where entrepreneurial energy is aimed. The test is whether a solution complements public services, expands public capacity, reduces delivery costs, improves accountability, or helps the state reach people more effectively. The sector should not just fill gaps left by weakened public systems. It should help rebuild them.

What we need is a sector willing to say, plainly: Paying tax is an impact strategy. Not a ceiling. More than an obligation, it is a contribution to the only systems ever shown to deliver essential services equitably and at scale. By overlooking the role of public systems, we may be missing out on one of the most efficient impact strategies available.

Seven years ago, Becky Straw co-founded The Adventure Project, a nonprofit that works to create jobs in Africa. She was not a computer programmer, so she paid a developer $7,000 to create a website using the application Webflow. For years, she wanted to embed a customized map feature on the homepage using Mapbox to show where the organization was making progress, but she didn’t have the funds to afford more development. Earlier this year, funding to hire a developer became irrelevant. Straw didn’t know any more about website developing and coding than she did seven years earlier, but Anthropic’s AI assistant Claude did, and she used it to create the code she needed to embed Mapbox herself.

For decades, nonprofits have been beholden to commercial software companies and developers—and more recently, software as a service (SaaS) companies—to manage and support infrastructure essential to core operations. This created expensive trade-offs, including vendor lock-in, price increases, limited customization, dependence on commercial roadmaps, and occasional break down, like when the fundraising company Flipcause went bankrupt and left organizations scrambling to replace it.

AI-powered coding tools are challenging the stranglehold that software companies have traditionally had over nonprofits. Some people are calling this moment the SaaS-pocalypse. I call it Strategic Independence Day.

Vibe Coding

Straw is now “vibe coding,” which is when a non-developer uses a tool like Claude or ChatGPT and other apps to build or modify products according to their own unique needs. This democratization of coding has profound implications for nonprofits that have traditionally hired experts and licensed software to create websites, fundraise, analyze data, and manage finances.

For instance, instead of licensing an expensive customer relations management tool like Salesforce, a person can describe the tool they want, including how it should look and operate, to a generative AI or an AI coding app like Lovable, and then let it do the coding work to create exactly the spreadsheet they need to track projects and contacts. It’s the difference between buying a suit off the rack to having one tailor made.

Highly Tailored Tools

Developers are also using AI in ways that promote nonprofit efficiency and strategic independence. Aaron Suzuki, founder of the AI consultancy Prowess Consulting and a board member of the Blue Devils Drum & Bugle Corps (BDPA), offers an example. BDPA is a musical performing organization whose primary fundraising mechanism is hosting bingo games—a financially complicated operation with thousands of daily transactions to manage. Suzuki’s consulting firm, Prowess, used “agentic development”—where AI-powered tools write code, run tests, find and fix errors, and sometimes make decisions about how to implement a feature, with human oversight—to create a custom AI agent called Bingo Daily. The agent reads daily transaction spreadsheets, organizes and structures the data for automated entry into QuickBooks, and flags anomalies such as duplicates and unusually large or small transactions.

Built in less than 20 hours, the system has already reduced BDPA’s outsourced accounting costs by as much as 25 percent per month, and timely visibility into the operation’s financial performance allows leadership to close the monthly financial reports, spot trends, and make adjustments more quickly.

Another example comes from GiveDirectly, a global nonprofit that provides direct cash assistance to people in poverty around the world, where staff often have to decide very quickly whether the organization can mount an effective response to a crisis. To support this process, GiveDirectly built an AI-powered, scenario-planning tool that brings together the multiple variables GiveDirectly must consider, including the scale of need, available funding, operational capacity, access to affected communities, and whether cash assistance is appropriate based on previous organizational experience. The tool doesn’t make the decision, but it helps staff evaluate the options systematically based on past experiences.

This is not to suggest that organizations will or should stop using commercial software products, but these examples show how they can decide which systems are mission critical and worth controlling, and build and customize them independently.

Improved Platform Quality

AI-powered coding is also ushering in a new era for nonprofit technology providers. Over the past few decades, as technology became an enormous driver of economic growth, conventional wisdom dictated that only commercial technology companies had the know-how and resources to create quality products. That made sense when it took millions of dollars and many engineers to make and maintain products, but AI is erasing that barrier. Now, smaller engineering teams are using agentic coding to create products that only much larger teams could have developed in the past.

For example, using agentic coding at Every.org, a nonprofit giving platform I lead, has contributed to a 10x increase in nonprofit donations without increasing engineering headcount. Every.org is entirely supported by donations, but because of AI, its engineering capacity and development speed can match much larger commercial companies. The organization is meanwhile adding capacity in customer service and partner outreach to make sure that nonprofits and donors always have access to human support.

Other nonprofit tech providers are using agentic coding to build and sustain sophisticated, mission-critical software at commercial scale. These include Mifos X, a spinoff of the Grameen Foundation’s Mifos product that provides free, open-source financial software for microfinance efforts globally. OpenMRS is another open-source effort that provides free software to store and protect medical records. It replaces paper records and currently supports more than 22 million patients worldwide, including the treatment of people with HIV, malaria, tuberculosis, and maternal health issues.

Social good isn’t a market segment or a quaint notion; it’s an essential part of a healthy democracy and society. We need a technology ecosystem dedicated to social good not to profits.

Getting Started

Nonprofits interested in how AI can support greater technological independence can take three steps to get started. The first thing to do is set ethical and human-centered standards, and put policies in place to guide new efforts. For example, AI shouldn’t take over the management of internal operations at any organization. Organizations need to help staff understand when and how they should and shouldn’t use AI-powered code and remember that human judgment is essential to running ethical, empathetic organizations. Humans should test and review everything before implementation.

Second, organizations should identify their most critical infrastructure—the systems or products essential to achieving their mission. Maybe it’s client communications for a social welfare organization or a hospital workflow that literally impacts life and death. These systems are worth investing in, and nonprofits should develop and customize them for their own use.

From there, organizations should determine whether they want to use vibe coding to create a new iteration of a core product themselves, using generative AI platforms or coding apps, or whether they need outside help from a company proficient in agentic coding that can customize applications for them. Either way, it’s important to adopt an iterative process—to start with one part of infrastructure, and learn and build over time. There is no need to do this quickly, but it’s important to do it well.

Nonprofits no longer need to accept the trade-offs of using commercial software. The tools to build and customize applications will continue to change and evolve rapidly over the next few years, but the opportunity to claim strategic independence is here, right now.

In the wake of conservative political activist Charlie Kirk’s murder last year, many of his obituaries made mention of the same curious fact in his origin story: At age 18, Kirk set out to build a conservative equivalent to the progressive campaigning powerhouse MoveOn.org. There is no question that Kirk went on to build a tremendously influential organization in Turning Point USA (TPUSA). But, as researchers with expertise in the study of digital political associations, this reference struck us as both incorrect and interesting. TPUSA is no conservative MoveOn. Its structure, campaign strategies, and tactics are quite different. Yet, both organizations have successfully mobilized their members, both on-line and off-line, and shaped US politics in the process. There are meaningful lessons to be gleaned from the differences between these organizations.

We suspect that, just as the American right never managed to build its own MoveOn, the American left will not build its own TPUSA. Successful political organizations respond to, and are shaped by, both the changing political context and the evolving media environment. Just as MoveOn’s structure was forged in the politics and digital media of the 2000s, and TPUSA adapted to the politics and digital media of the 2010s, the next wave of advocacy organizations will have to seek answers to how to communicate and build power in the late 2020s.

The MoveOn Model

MoveOn was founded in 1998, the work of two software developers—Wes Boyd and Joan Blades—who had recently sold their company. It began as a single online petition, calling on Congress to “censure [Bill] Clinton and Move On” from the Monica Lewinsky scandal. Over 500,000 people signed. When Congress was unmoved, Boyd and Blades had a realization: Every online petition signer had provided their email address. They could reach out to all their fellow petitioners with proposals for future actions. The e-petition became the equivalent of a member list for a new type of digital advocacy organization.

During the mass mobilization against the Iraq War in 2003, MoveOn emerged as the largest and most powerful progressive advocacy organization in the United States. It built a list of several million members who took aggressive action together, both online and offline. It did so by engaging in a then-new style of nimble, responsive, multi-issue political campaigning. As Ben Brandzel, a MoveOn staffer who would go on to found the Online Progressive Engagement Network (OPEN) put it, the key to the organization’s power was a “sticky, light-touch structure that captures kinetic energy from high-energy moments. It stores that energy and grows it as movement power, then re-energizes and redeploys it elsewhere.”

The MoveOn model proved remarkably successful for progressives and it was the cutting edge of digital political activism in the 2000s. The model was replicated by other progressive groups in the United States, elements of it were adapted by well-known NGOs, and the model spread internationally with activists in over 20 countries creating their own versions of MoveOn.

Given MoveOn’s impact, it makes sense, then, that Charlie Kirk started his career looking at MoveOn as the model that conservatives needed to emulate. A “MoveOn of the right” would be an organization with a massive list that it mobilizes primarily via email to take collective political action. It would focus on applying pressure to the existing political system through rapid response campaigns. It would also engage in digital listening, accepting that it would be both guided and constrained by its members. MoveOn’s power is based in its capacity to get members to repeatedly take action, meaning the organization cannot stray too far from the interests, tastes, and preferences of its membership. MoveOn staffers have historically referred to this guiding philosophy as “Strong Vision, Big Ears.” That’s the core of the model. There is more to it, of course. But if you were looking to build a minimum-viable-version of MoveOn, that’s what you would do. Rapidly respond to political events, giving your membership an outlet for their shared concerns and values. Build a large email list. Repeatedly mobilize them to take political action.

The Turning Point USA Model

Charlie Kirk founded Turning Point USA in 2012. He referenced MoveOn in his pitch to conservative donors and philanthropists. The pitch worked. He raised millions in donations. But the organization that he built had little in common with the one he intended to replicate.

TPUSA focused on university campuses and in-person events. Arguably the most important element of TPUSA’s model was Kirk’s charismatic leadership. Kirk became widely known for his roving campus tours, where he would set out to debate left-leaning college students and make a full-throated case for conservative orthodoxy. These events, which had a touch of Christian Revivalist preaching, were filmed and then edited to go viral on social media. This is what Ezra Klein was referring to when he described Charlie Kirk as having “practic[ed] politics the right way”: “He was showing up to campuses and talking with anyone who would talk to him. He was one of the era’s most effective practitioners of persuasion. When the left thought its hold on the hearts and minds of college students was nearly absolute, Kirk showed up again and again to break it.”

There is, again, of course, more to it. There were conferences and trainings and a super PAC. There was the professor watchlist. But the minimum-viable-version of the TPUSA model is to focus on college campuses and build a network of student groups that expand the zone of legitimate debate, with the goal of normalizing a set of political and social beliefs among young people. Center that network around a charismatic leader and create momentum through media moments designed for viral spread on social media. This, to our eyes, is an entirely different model from what MoveOn built.

Three Critical Differences

The differences in organizational form can be summarized along three dimensions: youth-focused vs. full populace; 2000s internet vs. 2010s internet; and conservative vs. progressive political organizing traditions.

TPUSA is an expressly youth-focused organization. It set out to develop a new generation of conservative activists, and has largely succeeded in doing so. This places it in a similar mold as Young Americans for Freedom (YAF) and the College Republicans—organizations that served as the training ground for previous generations of conservative political leaders. But it bears little similarity to internet-mediated issue generalists like MoveOn. A conservative MoveOn would build the largest feasible supporter list, and then activate that list around a mix of local, national, and international campaign opportunities. The focus on campus activism would be a limitation, rather than a strength, for such an organization.

Both TPUSA and MoveOn strike us as remarkably successful products of the digital media environment they were built in. MoveOn rose to prominence in the early Web 2.0 era—a media system dominated by political blogs, Google search, and mass email lists. Communities of online hobbyists were beginning to find each other and organize offline. Mainstream media outlets were still relatively stable and influential (compared to today). The best way to reach a large number of people was to have a large email list, and to plan tactics that would generate mainstream media coverage.

By the early 2010s, when TPUSA was getting off the ground, the internet of blogs and search was being replaced by an internet of algorithmic feeds and social media sharing. In a social media-dominated environment, the best way to reach a large number of people was to create media content designed to go viral, often by generating outrage. Mainstream media was taking its cues from viral social media trends by that point as well. A campus-focused organization that produced media clips of its charismatic founder besting his opponents in verbal debate could, in that decade, reach a much larger audience than a mass-members organization with a large email list. Media change leads to new organizational forms.

The difference in political ideologies also matters. As Jen Schradie notes in her 2019 book, The Revolution that Wasn’t: How Digital Activism Favors Conservatives, conservative social movements often have different strategic goals than their progressive counterparts. TPUSA was built for political persuasion—expanding the Overton Window and normalizing a set of political and cultural views that otherwise had been treated as outside the zone of legitimate debate. Imagine what a leftwing TPUSA would have looked like during the Biden years. A campus tour where a charismatic leader debated conservative students and demonstrated that climate change is real, the Laffer Curve is ineffective tax policy, or people shouldn’t go bankrupt because a family member gets sick? None of these claims are especially edgy or transgressive. They are broadly popular and accepted political claims which already sit within the zone of legitimate debate. The hard work for advocates lies in designing policies and pressuring politicians to enact those policies. A progressive mirror image of TPUSA would not be hailed as accomplishing nearly what TPUSA has accomplished, because it would be structured to solve the wrong problem.

TPUSA was (and is) a top-down organization, with a clear message and a charismatic messenger (Kirk). It is hierarchical. MoveOn, by contrast, was built for political mobilization, with the ultimate goal of passing progressive laws. MoveOn is a less hierarchical organization, which seeks to channel and mobilize its grassroots membership, rather than relying on a charismatic leader (many MoveOn members probably could not name the MoveOn executive director, the same is not true for TPUSA). The Internet is many-layered—a multitool, if you will. But, as Schradie demonstrated, the internet is especially effective as a broadcasting machine for charismatic figures. Converting public discourse into legislative results is quite a bit harder, and requires different institutional capacities, than injecting new perspectives into the online discourse.

Should Progressives Try to Build Their Own TPUSA?

Following Kirk’s death, it was reported that TPUSA rapidly increased its presence in high schools and campuses across America. According to the New York Times it doubled the number of chapters in high schools from 1,200 to over 3,000. Donations also surged immediately after Kirk’s death, with one donor pledging $1 million. Tucker Carlson, a friend of Kirk’s and former Fox News broadcaster, also sent a fundraising appeal on the organizations behalf. However, TPUSA now faces a more contentious landscape within the conservative movement. It has also been attacked by far-right influencers, including former TPUSA employee Candice Owens, who have spread conspiracy theories and attacked TPUSA staff and Erika Kirk. TPUSA has also allegedly suffered from being too close to Trump and the institutionalized MAGA movement. Some TPUSA followers have drifted to other far-right influencers who are more critical of Trump. Hence, while the organization may still galvanize many students, its centrality to conservative youth politics is less clear since Kirk’s death.

Nevertheless, we suspect that there are some left-wing progressives considering a similar path that young Charlie Kirk did—meeting with potential funders and pitching plans to construct a progressive equivalent to Turning Point USA. This is unlikely to succeed, for the very same reasons that Kirk never replicated the MoveOn model. The digital media environment circa 2025 is different from the one that Kirk first operated in. We no longer orbit around the Facebook feed and the Twitter algorithm. The future of digital media—given the decline of the centralized website and platforms and the rise of AI slop—is more fractured, more fractious, and more fake than what came before. It is unclear whether TPUSA’s iconic tactics will work nearly as well under these conditions.

What strikes us as more likely is that progressive movement entrepreneurs will set out to emulate the success of the opposing side but then find themselves building something quite different. New social movement organizations are a product of their political moment, the media environment, and the needs of the broader progressive (or conservative) movement. They rarely directly replicate what their opponents have built, even when they try. They can look to them for ideas, but then they have to reach for something new.

Not long ago, a clear sign a foundation took results seriously was an evaluation department. Today, it is a learning team. You can see the change in The Center for Evaluation Innovation’s 2023 benchmark report: “Learning” appeared in nearly two-thirds of surveyed evaluation staff titles, up from one in five in 2015, and overtook “evaluation” for the first time.

This is a good thing. As a corrective for very real failings of funder-led strategic philanthropy, this movement “from evaluation to learning” represents what Hilary Pearson describes as “a mindset shift for philanthropy’s language and practice.” Foundations have too often treated themselves as detached experts, imposed burdensome evaluation requirements, and measured what is easy to count rather than what matters. The learning turn rightly calls for greater humility about what funders can know and control, a more pragmatic focus on improving impact, and a deeper commitment to relationships with grantees and communities.

However, the learning turn also risks obscuring an obligation that funders cannot escape: the obligation to exercise judgment.

The Inescapability of Judgment

The learning turn changes what and how funders know, but it does not determine what they should do. And funders must do, fundamentally: They cannot escape deciding whose claims are credible, how to weigh different evidence, which values should inform a grant, and whether one use of resources is more compelling than another.

The learning turn does not deny that responsibility, of course. Its leading accounts describe learning as a basis for decisions and action, and some explicitly connect it to strategy development and implementation. Yet the field’s practical guidance tends to be strongest after a funder has already selected a broad direction: learning from work in progress, testing assumptions, and adapting future grantmaking strategy. That guidance generally has much less to say about how to compare competing needs, approaches, and funding opportunities before resources are committed. And where the guidance does address that earlier stage, it often emphasizes whose knowledge should shape the grant decision. Advocates call for “privileging community and practitioner voices,” demand that “philanthropy needs to trust the real experts—the people it supports,” and assert that “the people in the community know what they need.”

Such appeals respond to undeniable problems of funder overreach but leave important questions unanswered: What should funders do when stakeholders disagree, when their convictions conflict with other evidence, or when several legitimate needs compete for limited resources?

The reality of disagreement over how to address issues within communities illustrates the difficulty of turning learning into action. In his 1957 classic Community Conflict, James Coleman showed that local decisions, from school policy to public health, routinely split communities. More recently, Jeremy Levine’s ethnography of participatory planning in Boston found that “the community” had no fixed and consistent meaning. Residents and nonprofit leaders invoked the term to lend authority to their claims, even as redevelopment officials sometimes used it to justify decisions that those same residents opposed. These examples demonstrate how communities are not of one mind.

The veneration of practitioner knowledge encounters the same fundamental problem. Educators disagree over reading instruction, homelessness providers debate housing-first and treatment-first models, and addiction professionals differ in their acceptance of medication for opioid use disorder. Moreover, frontline experience cannot in and of itself establish whether a particular intervention deserves support. Efforts such as D.A.R.E., Scared Straight, and abstinence-only education show how practitioner conviction can endure even after rigorous evaluations cast doubt on outcomes.

These challenges do not mean that funders should not engage communities and practitioners, of course; their input can surface overlooked views and clarify stakes. But including these voices still leaves the hard work of deciding how to interpret conflicting views and which claims should steer the funder’s choices. The learning turn has offered little guidance on how to weigh what funders hear, especially when what they hear does not furnish a coherent strategic mandate.

That imbalance raises a practical question: How well has philanthropy equipped funders to make such judgments?

The Unfinished Work of Choosing Well

Strategic philanthropy, whatever its excesses, made important progress by encouraging funders to define their goals, articulate how their resources should advance them, and assess their results. Yet practice has often lagged rhetoric. In a 2009 report, the Center for Effective Philanthropy surveyed leaders of large private foundations, finding that most had board-approved strategic plans, yet fewer than half reported having a logic model connecting their resources to their goals, and just eight percent could describe the specific data behind their belief that they would achieve at least some of those goals. A 2018 study found the gap persisting: 65 percent of foundation CEOs said they understood what was working in their programs, yet 42 percent said their foundations were not investing enough in developing that understanding.

Put simply: By the time the learning turn arrived, the discipline of choosing well was still half-built. It has remained so.

The gap extends from high-level strategy to the selection of individual grantees. Strategic philanthropy has imported the language of due diligence from the investment world, but the practice typically centers on the prospective grantee’s leadership, governance, finances, and fit with funder priorities. A 2023 Bridgespan review of 26 diligence resources found a “wealth of tactical tools” for vetting organizations, but most presumed the funder had already chosen its areas of focus and intended impact. “Serious due diligence is one of the biggest missing ingredients in philanthropy today,” Herb Sandler observed in a 2015 article whose authors noted that few donors devote extensive time to researching social-change opportunities before major commitments.

If anything, the learning turn may be eroding the partial discipline that strategic philanthropy built. In the National Center for Family Philanthropy (NCFP) Trends 2025 survey, the share of family foundations that guide their giving with strategies for creating change, including theories of change and strategic plans, fell from 50 percent in 2020 to 31 percent in 2025, and the share guided by measurable goals dropped from 41 percent to 19 percent. Family foundations are also less likely to ask grantees to set and measure program goals than at any point in the past decade (21 percent, down from 34 percent in 2015), yet a third now describe themselves as active learning institutions, a 14-point jump in five years. That learning is gaining institutional ground is an undoubtedly positive development, but it is less encouraging that the practices for articulating intended change are ceding ground at the same time.

Nevertheless, working models of a more complete discipline do exist in different corners of the philanthropic sector. For example, GiveWell compares funding opportunities against a common cost-effectiveness benchmark, Robin Hood estimates the benefit-cost ratio of each grant in its anti-poverty portfolio, and Co-Impact publishes a handbook spelling out the evidence and the account of systems-level change it expects from candidates. While these approaches reflect particular missions and cannot simply be transplanted to other organizations, they demonstrate how different funders can make causal assumptions, expected outcomes, uncertainty, and tradeoffs explicit.

The unfinished work, then, is making impact diligence a norm across philanthropy. While conventional due diligence examines the prospective grantee, impact diligence examines the case for the grant itself. It focuses on whether the proposed work is likely to produce meaningful change, and whether it is a better use of limited resources than available alternatives. Such analysis should be rigorous enough to improve decision-making, flexible enough to accommodate different forms of social change, and proportionate to the stakes of each grant. To build that norm, philanthropy needs to move rigor upstream.

Moving Rigor Upstream

The learning turn has clarified what funders should do less of after making a grant: restrict expenditures unnecessarily, impose duplicative reporting, prescribe implementation, and demand fidelity to outdated plans. The remaining question is what funders should do before making a grant if they are to exercise less control afterward.

Moving rigor upstream means placing more of the funder’s analytical discipline on the deliberations that precede a grant, while the allocation decision is pending. In practice, moving rigor upstream has four implications for how funders approach grant decisions.

1. A consequential grant should rest on an explicit case detailing why and how the proposed work should produce meaningful change and why it would be a compelling use of limited resources given plausible alternatives. Making that case requires clarifying the causal pathway from funding to impact, reviewing the evidence base for anticipated outcomes, considering what would happen without the intervention or without the funder’s support, assessing costs, and identifying key uncertainties and potential tradeoffs.

2. The funder should shoulder the analytical burden. Trust-based philanthropy, a movement related to the learning turn and focused on shifting power toward grantees, already urges grantmakers to “do the homework” so that early vetting burdens funders rather than applicants. Much of that homework, however, concerns the organization: its leadership, finances, governance, and alignment with the funder’s priorities. As noted previously, impact diligence extends this scrutiny to the grant’s expected impact. A foundation considering several organizations working on the same problem, for example, could conduct its own review of the relevant research and use that evidence across its decisions rather than asking each applicant to make the evidence case from scratch. Grantees could then focus on what they uniquely know about local context and operational realities.

3. The written product of diligence should record the funder’s judgment without prescribing how the grantee must subsequently act. For a significant decision, a short internal memo might explain what the funder expects to change, why it believes the proposed approach can produce that change, what evidence supports the case, what alternatives it considered, and where uncertainty remains. Such a memo creates a record of the funder’s reasons for approving the grant without turning the funder’s initial assumptions into implementation requirements for the grantee. Once the grant is underway, the funder can revisit that record as new information emerges, enabling the funder to understand which assumptions held up, which did not, and what needs to change in future decisions.

4. The depth and form of diligence should match the nature of the grant decision. A small renewal to a long-trusted organization should require less analysis than a large commitment to a new program in an unfamiliar field. An evidence-rich direct-service intervention may lend itself to estimating costs and expected outcomes, while an advocacy or systems-change grant may require scenario analysis, contribution reasoning, and more explicit treatments of uncertainty.

Moving rigor upstream asks funders to take greater responsibility for the quality of their choices so that they can exercise less unnecessary control afterward. If the learning turn has taught philanthropy to listen more humbly, the next task is to choose more rigorously. Learning can enrich decisions, challenge them, and sometimes overturn them. But learning is not deciding.

This is, without question, the hardest moment in decades to lead a social sector organization. Nearly 70 percent of nonprofit leaders in the United States reported a drop in funding in 2025. At the same time, 65 percent report demand for their services has increased. Thirty percent have been forced to cut services—among them, programs that are vital to the health, safety, and survival of individuals and families.

The numbers are staggering in their own right. An analysis by outplacement firm Challenger, Gray & Christmas found that the nonprofit sector cut nearly 29,000 jobs in 2025—more than quadrupling the losses recorded in the prior year. According to an Urban Institute survey, a third of all nonprofits experienced some form of government funding disruption in just the first four to six months of 2025, including organizations delivering job training, mental health services, emergency shelter, and disaster relief. The Trump administration canceled or froze an estimated $425 billion in federal funds across health, education, and social services in the first half of 2025, and CEP data reveals that a year later, nonprofits are still reeling: Two-thirds of nonprofit leaders in a national study reported concern about their organization’s financial stability in early 2026.

For many foundation leaders, the question is no longer whether to respond—it is how. How to balance urgency with long-term strategy. How to move quickly and strategically at the same time. How to justify increased risk to boards whose instincts lean toward institutional preservation. And so far, foundation CEOs do not believe they are responding adequately, according to a new study. This is where the story becomes both more complicated and more urgent: For most foundation CEOs, the decision about whether and how to amplify impact in this moment—whether to increase payout, take on greater institutional risk, redirect grantmaking toward crisis response—does not ultimately rest with them. It rests with their boards.

The resources, the relationships, and in many cases the will to respond meaningfully to this crisis exist within the walls of foundations. The question is whether boards will open the door—and what it will take to move them.

The Governance Gap

Data on boards of mission-driven organizations more broadly suggests this is not a foregone conclusion. For decades, BoardSource’s Leading with Intent study, the most comprehensive longitudinal examination of nonprofit board practices in the United States, has tracked a persistent and troubling pattern among both foundation and nonprofit boards: Boards perform reasonably well at internal oversight functions and significantly worse at everything that requires external engagement and strategic courage.

In its most recent survey of over 500 chief executives and board chairs, BoardSource found that boards earned some of their highest ratings in financial oversight and legal and ethical compliance, while having room to improve on fundraising and advocacy. These ratings are not new—they have been consistent across decades of data collection. But in the current environment, they take on new urgency. The skills and orientations boards have consistently deprioritized are precisely the ones needed right now.

Consider advocacy. Over half of both board chairs and executives report that advocacy/public policy is not at all or is only a small part of their organization's overall strategy. These boards are not ignorant of the stakes: Ninety percent of executives said their boards understood to some extent how public policy affects their organization’s mission. They know. They simply aren’t acting.

The Conversation Nobody Wants to Have

In interviews we conducted with foundation leaders in late 2025, we heard the same frustration surfaced again and again: the wish that boards “would step up to have this discussion about spend rate,” and, simultaneously, the acknowledgment that, for some, the current crisis is finally forcing the conversation.

The federally mandated minimum payout rate for private foundations is 5 percent of assets annually. Many foundations give at or near this floor, a practice defended as preserving the foundation’s capacity to give in perpetuity. The logic is familiar and, in many circumstances, reasonable. But perpetuity arguments assume a stable environment in which communities and organizations can absorb the gap between what foundations give and what is needed. That assumption has collapsed.

A recent publication by the National Center for Family Philanthropy, drawing on interviews with more than 60 foundation CEOs and board chairs, documented how many boards that ultimately made bold commitments following the murder of George Floyd and during COVID-19 did so only after having difficult governance conversations they had previously avoided. The pattern suggests that the current moment may similarly serve as a forcing function. But it also suggests that these conversations don’t happen without someone in the room willing to name the discomfort directly.

This is the foundation CEO’s dilemma. Two-thirds of foundation leaders in a recent Center for Effective Philanthropy study named specific ways their boards could strengthen philanthropic impact right now, including increasing payout, developing a better understanding of the context facing partners, and taking more institutional risks. They know what is needed. They often lack the structural permission to pursue it.

What Responsive Governance Looks Like

There is no single prescription for what foundation boards must do in this moment. But the research and the moment together suggest several orientations that distinguish boards positioned to amplify impact from those likely to wait it out.

Mission-first calibration. BoardSource’s research consistently finds that boards with the strongest performance share a common trait: They treat mission not as a backdrop but as an active decision-making criterion. In this environment, that means asking a specific and uncomfortable question: What does our stated mission require of us right now? A foundation committed to thriving communities cannot treat the collapse of the organizations doing that work as someone else’s problem. A foundation whose mission involves health equity cannot remain on the sidelines while mental health and housing organizations lose federal funding by the billions. Reconnecting board discussions to mission language—concretely, not abstractly—is both the most straightforward and most underutilized tool available to foundation leaders seeking to create the conditions for bolder action.

Ensuring the stakes are clear. Boards cannot make well-calibrated decisions without accurate information about what their grantees are experiencing. This means more than reading a report or reviewing a dashboard. It means creating direct lines of communication between board members and the communities they serve—through structured conversations with grantee partners, through community input sessions, through listening structures that bring the weight of this moment into the boardroom rather than filtering it out in the name of board time efficiency. Leading with Intent found that “boards with stronger knowledge of their organization’s programs outperformed on nearly every dimension of governance, including strategy, community engagement, and fundraising. The same principle applies to contextual knowledge.” Boards that understand what is actually happening are better positioned to act.

Having the hard conversation. Conversations about payout, taking on institutional risk, and whether the foundation’s current grantmaking strategy meets the moment are uncomfortable. None of these conversations happen without someone naming the need for them. In a recent survey, CEOs who wished their boards would initiate the spend rate discussion were often sitting next to board members who also sensed the inadequacy of current posture but were waiting for someone else to speak first. The first and most important governance act available to foundation leaders—CEO and board chair alike—may simply be to ask for the conversation, by name, on the agenda, with enough time to have it meaningfully.

Not waiting. One nonprofit leader recently described what it feels like to be on the receiving end of foundation hesitation: “We have seen more use of our food pantry than at any other time in our organization’s history. There’s less funding available, our funders are being more restrictive, and we’re all looking at shortfalls for the first time in our organization. So, we’re just like, ‘When is philanthropy going to start releasing funds?’” The risk of a wait-and-see strategy is not merely that help arrives late. It is that by the time foundations are ready to act, the organizations they would have funded no longer exist. Programs pause. Staff leave the sector. Institutional knowledge built over decades dissipates. The Chronicle of Philanthropy’s nonprofit layoff tracker documented that as 2026 opened, the sector was still shedding jobs, with leaders reluctant to hire even when funding appeared because the trauma of 2025 had fundamentally altered their risk calculus. The window to prevent organizational collapse is shorter than boards tend to assume.

The Political Dimension

Any honest accounting of this moment must acknowledge what is different about it. Unlike COVID-19 or the financial crisis of 2008, the current threat to nonprofit infrastructure is not purely economic. It is partly political in origin and character, which means it raises questions that boards, particularly those of 501(c)(3) organizations, often prefer to avoid.

The Trump administration’s campaign against nonprofits has been described by sector leaders as among the most hostile policy environments in the history of American civil society. Since early 2025, federal actions affecting nonprofits have included the termination or withholding of federal grants, new conditions on federal funding, threats to the tax-exempt status of nonprofit institutions, and efforts to expand federal authority to suspend or terminate grants. Many of these actions have faced legal challenges, with courts blocking some funding freezes and grant terminations. These developments have created significant financial, legal, and operational uncertainty for nonprofits across the country.

Foundation boards that treat this environment as simply a difficult funding cycle are misreading the nature of the challenge. What is at stake is not just whether grantees can meet this year’s budget. It is whether the infrastructure of American civil society can survive at sufficient scale.

The Question of Leadership

The instinct to do more, to recognize that extraordinary times require extraordinary governance, is more common among foundation leaders than the current pace of institutional response would suggest. The gap between what board members sense and what they are willing to act on is not primarily a gap in information or values. It is a gap in permission and structure. Boards need to be asked. Conversations need to be had. The explicit, named request—from a CEO, from a board chair, from a trusted colleague—to consider whether the foundation’s current response is equal to the moment is often all that separates motion from stasis.

The nonprofit sector is in dire straits. The organizations that catch people when every other system has failed are now stretched to the breaking point themselves. While philanthropy cannot “fill the gap” left by the disappearance of federal funds, the resources to respond meaningfully—in ways that could prevent the worst outcomes—exist inside American philanthropy. Whether those resources reach communities in time depends less on wealth than on governance: on whether foundation boards are willing to have hard conversations, to reorient decision-making around mission rather than institutional preservation, and to recognize that the risk of inaction is now greater than the risk of action.

Nonprofits are asking when philanthropy will start releasing funds. The answer to that question is determined, ultimately, not in the grant office but in the boardroom. The keys are in hand—the question is who will unlock the door.

Generative AI is transforming entry-level jobs faster than most workforce organizations can adapt their trainings. Indeed, rushing to adopt AI tools risks deepening the inequities these organizations exist to address. How can workforce providers and higher education adapt their offerings quickly enough to help prepare learners better for the changed world of work, and can Gen AI help them do it?

Our organizations—Per Scholas and the American Institutes for Research (AIR)—have been early adopters of AI in the workforce field, and we see its potential to increase efficiency and deepen learning supports for those who need them most. But our optimism comes with a healthy dose of skepticism. We do not want to adopt AI for its own sake; we must show that it advances our mission to expand economic opportunity. Which AI solutions are a good fit and actually add long-term value, instead of just creating noise? Which ones amplify progress towards organizational mission versus draining resources?

To avoid the hamster wheel of endless pilots, we are pairing AI adoption with intentional design and rapid-cycle learning, to build a flywheel of continuous growth and adaptation, grounded in data and evidence. Five years into our partnership across multiple AI pilots, we’ve reached some important insights into what it takes to reach this north star: an intentional and iterative approach to AI adoption, a culture that sustains responsible and effective integration of AI, and how to fund it.

Going Slow to Go Fast

Being an early adopter doesn’t mean we need to go at lightning speed. In four key areas, we’ve found that slowing down implementation allows teams to learn, iterate, and achieve stronger long-term results.

1. Being explicit (and getting perspective) about expectations. Passionate, experienced staff are essential, but passion—as well as pressure to stay current with the latest AI tools and use cases—can create blind spots.

Getting help from an external rapid-cycle learning partner can help address this risk. A big value-add of the Per Scholas–AIR learning partnership has been rich discussions to co-develop a detailed theory of change and logic model up front. These discussions not only clarify key outputs and why they matter, help to surface the pathways through which change is expected to occur, but also make implicit assumptions explicit. Treating the theory of change as a living document to revisit has also helped us document our real-time learning, as well as encouraging honest conversations on when and why we pivot.

2. Using data to change assumptions to facts. Meaningful metrics around expected outputs and outcomes need to be designed early. We have found it useful to start with ambition, defining the indicators we want for decision-making in the form of both “leading indicators” and lagging (final) indicators. Both are important. True mission amplifier outcomes—like job attainment—take too long for the pace of change we need. We therefore need to identify meaningful leading indicators that can help us measure, test, improve, and pivot in new directions.

3. Finding low-hanging fruit. After identifying the ideal, we get really practical. We review existing data practices to identify what we have and where there are data gaps, mapping closely to the theory of change. Perfect cannot be the enemy of good, so we begin first with what we can collect with minimal system changes and then integrate that data into operations. It’s useful to log the ones we can’t address as items to prioritize for future data enhancements and/or episodic studies. Rapid-cycle learning partnerships help teams use existing data and complement these with additional data collection (interviews, observations, pulse surveys) to generate richer insight, as well as creating space for understanding results and implications.

4. Focusing on high leverage points. “Build it and they will come” happens more frequently than it should in social impact programs, not only at the program level but also as it relates to AI tool adoption. We have often observed uneven AI adoption during early discovery, where the main barrier was not resistance, per se, but simply a desire to continue using AI tools they were already familiar with. That finding is feeding into concerted design and testing of different implementation and technical assistance strategies. Getting the small stuff right increases the odds of down-the-line impacts.

Creating and Sustaining a Culture of Learning

Agile, data-driven adaptation of work requires a culture change. It also requires rethinking how we do our own work, whether that means creating new opportunities directly or understanding how to do it well through research.

Three key ingredients seem necessary to create the kind of culture of learning that can accomplish this:

1. A shared north star for focus. Per Scholas’s north star has been “job, jobs, jobs,” and focusing on impacts and job placement provides clarity and helps align different initiatives. This accountability—not just around training but also around jobs—has been a critical impetus for understanding how AI is changing the labor market and how to leverage AI to find solutions. It has motivated Per Scholas to be an early adopter of initiatives that embed AI literacy and applied AI tools directly into technical training to help learners graduate as AI natives. It has also sharpened the focus on staff AI literacy and the use of AI to accelerate learning through career coaching, employer partnerships, and wraparound support.

At AIR, a commitment to actionable research delivered through integrated learning partnerships has led to a similar focus. In research, rigor has sometimes been used as an excuse not to tackle hard questions, but focusing on the most urgent questions that decision makers currently face, and then finding the best possible way to answer those questions while being transparent about the limits of the strengths and weaknesses of our findings This approach has allowed us to be strong partners for real-time learning.

2. A culture of pivoting in response to data. Sometimes innovations and rapid-cycle learning are useful in and of themselves but fail to add up to bigger changes. It is therefore crucial to zoom out and ask, “What happens if we are right/wrong? What will that change? What would we do differently if we were doing it again? What do we carry over to other initiatives?”

Learning from “null results” can only happen when the organizational leadership and culture reward honest conversations around “failure.” Cross-initiative learning offers a powerful example. In our first experimental study collaboration on leveraging an intelligent tutoring system, we saw strong gains in learner certification. However, nearly half of learners never used the tool. That insight shaped our current pilot on using AI for job placement, and broader AI strategies at Per Scholas.

3. Don’t silo the innovation and learning function; build core skills that enable agility. Per Scholas has been fertile ground for intentional AI adoption and rapid-cycle learning because of how the organization thinks about innovation and data-driven decision-making. Instead of being nested in an innovation team, expectations around innovation, piloting, AI adoption, and data-driven decision-making are scattered across the organization. This approach requires organizational investment in building staff capacity as well as good design to spur participation and engagement.

On the research side, this approach requires building staff capacity for understanding the nitty-gritty of program partners’ implementation, systems for tracking evolution in programming, and the capacity for frequent adaptation of research designs to operational realities.

How can funders accelerate AI adoption to drive opportunity for all?

Not all organizations are fortunate enough to have the capacity to invest early in AI adoption and learn intentionally about what works and doesn’t. Here are a few areas of investment for philanthropy to consider so that AI helps lift all boats equally:

1. Bolster data infrastructure: The field is awash with AI tools and calls for proposals to either build more AI tools and agents or reduce the costs associated with existing ones. What is also needed is investment in the data infrastructure: data lakes, enterprise-level data systems, and integrated data from across systems, that allow AI tools to draw on the right data at the right time. As an AI leader at Per Scholas recently shared with us, “Data is in too many places. The promise of technology for so long has been the elimination of data silos. What we’ve concocted throughout every workplace is the hardening and scaling of data siloes through technology. We create so many different places where information lives.”

Now is the time to understand why such data siloes take root. It is also the time to experiment with how to support organizations in building integrated, usable data infrastructure.

2. Create and scale meaningful indicators that drive action: If we want organizations to pivot in real time based on data, we need more investment in defining meaningful indicators. This is especially important not just for achieving long-term outcomes but also for identifying “leading indicators” that might serve as early warnings systems to predict outcomes.

Organizations like Per Scholas are doing these one-off, in-house and would value shared learning on which indicators work for what. Shared investment in developing and aligning data indicators within and across programs would allow more opportunities to leverage existing data for core component analyses.

3. Support and create space for rapid-cycle learning: Practitioners and funders alike often equate research with impact evaluations and implementation studies that measure long-term results. These are important but not sufficient for the real-time transformative adaptation organizations need today. Bringing similar rigor and deep thinking to the program design and initial implementation stage is key. Early discovery activities—such as data analysis, user research, and landscape—can substantially strengthen program design from the start. This early investment is far more rewarding than trying to understand after the fact why a program didn’t work.

4. Create communities of practice to scale learning efficiently: Both Per Scholas and AIR receive requests from other nonprofits regarding how to leverage AI, suggesting that there is a space for philanthropy to help accelerate efficient AI adaptation and adoption. Peer learning is especially valuable because not all organizations can afford to learn by doing. Shared learning helps conserve scarce resources and remove friction as organizations modernize. For organizations that are more advanced, more tailored communities of practice that allow cross-learning across more mature organizations are needed so that proven programs can learn just as much as they share and teach.

We know that maintaining and growing access to economic opportunity will need all our ingenuity. AI can be a powerful accelerant but only if we marshal it well, truly creating a flywheel of collective impact. We hope a proactive approach to shared learning can help us and our peers meet the moment.

In the fall of 2017, we wrote in this publication that an estimated $30 trillion would change hands in the United States over the following decades as the Baby Boom generation aged and passed away, and that almost no one in the nonprofit sector was ready for it. We were graduate students at Stanford then, describing a wave that existed only in projections. Nine years later, the wave is here, and the state of play looks different from what we predicted—in many ways, better—but the philanthropic sector, and especially private foundations, need to do more to seize the moment.

Let’s start with the money. When we published, American charities received just over $30 billion a year through bequests (defined as gifts given when a donor passes away, most often in a will or trust). According to Giving USA, charitable bequests reached roughly $62 billion in 2025—double the level of a decade ago, up nearly 20 percent in a single year, and the third double-digit increase in four years. Bequests now supply about 10 percent of American giving, and they did much of the work in pushing total giving past $600 billion for the first time.

The projections have grown too. Cerulli Associates now expects $124 trillion to transfer through 2048, including the potential of an astounding $18 trillion to charity, though we believe reaching anything close to this number will require some major changes.

The demographics are no longer a forecast.

Roughly 76 million Americans were born during the Baby Boom, between 1946 and 1964, and the oldest among them turn 80 this year. These are the ages when Americans write and settle their final estate plans. The transfer we described in the future tense is underway, and it will run for decades to come.

In an extremely positive shift, nonprofits now embrace planned giving far beyond the major-gifts office.

This is the change we most hoped to see. In 2017, planned giving at nonprofits (the practice of raising gifts through wills, trusts, and beneficiary designations) lived almost entirely inside major-gifts teams and was offered to a narrow slice of wealthy donors, even though the evidence pointed the other way—we described an environmental organization that drew 70 percent of its planned-giving dollars from outside its top 10 percent of donors.

Today, most of the country’s leading nonprofits treat planned giving as a program for every supporter. Each August, thousands participate in Make-a-Will Month, reaching far beyond their list of major donors to encourage people to complete an estate plan and consider including a gift. Many will do it again during National Estate Planning Awareness Week, October 19-25 this year.

The broad ask produces real money: FreeWill, the company we founded as students to test the idea of “free estate planning that nudges charitable giving,” has now helped document nearly $15 billion in planned-gift commitments, with an average bequest of more than $50,000 (and an average of two charities receiving gifts per will with any charitable giving)—even though many of these givers would never have been identified as prospects for “major giving.”

To give a sense of how wildly impactful planned giving can be when done well: We believe the American Diabetes Association (ADA) and the World Wildlife Fund (WWF) both have particularly thoughtful and strategic planned giving efforts. ADA’s 2024 audited statements show that bequests ($42.7 million) made up 34 percent of all donated dollars. WWF’s audited statements from 2025 report that “bequests, endowments, and split-income gifts were $47.3 million,” meaning roughly one in four dollars from individuals arrives through an estate.

The hard part is investing in the future.

A planned-giving program takes years to mature and decades to pay out in full, while most nonprofits budget one year at a time: executive directors have payroll to make, development teams have annual gaps to close, and grant reports ask what happened during the funding period. The most successful organizations invest anyway, and they are being rewarded for it. Many others, including small and midsize organizations with deeply loyal supporters, cannot spare the staff and budget to ask.

This is where private foundations need to step up. They are nearly the only institutions in philanthropy that can repeatedly fund on the time horizon planned giving requires. A multi-year grant that builds a grantee’s bequest pipeline (staff, tools, donor outreach) becomes future unrestricted revenue the foundation never has to renew, and it leaves the grantee less dependent on foundations over time. Funders have spent years saying they want grantees to diversify revenue and build resilience; this is what that looks like in practice. The stakes are large enough and the ROI high enough to be blunt: even if the sector keeps making good progress, capturing only part of an $18 trillion opportunity would be among the greatest missed chances in the history of American philanthropy.

A few foundations are forward thinking here—the Harold Grinspoon Foundation has long sought to accelerate planned giving in the Jewish community through “training, support, and financial incentives” (in the form of bonus grants made when a planned gift is secured), and claims that this work has driven $2 billion in additional pledges to Jewish nonprofits. But HGF is far more the exception than the rule, and much larger entities need to play a much greater role.

Estate planning itself still needs to grow.

The deepest constraint has not moved: most Americans still have no estate plan. Caring.com’s 2025 wills study found that only 24 percent of respondents had a will, down from 33 percent in 2022, and the most common reason is the one we heard in our interviews a decade ago: people haven’t gotten around to it. A charitable bequest cannot be added to a plan that was never made, which is why the planning rate matters more to philanthropy’s future than any fundraising technique.

There is a bright spot here as well. Charitable giving is now woven into online estate planning in a way it never was at the desks of many attorneys. The research we cited in 2017 found that about 5 percent of people include a charitable gift when unprompted, 10.4 percent when asked simply, and more than 15 percent when the ask makes giving feel normal, findings that now shape how the online platforms are built. That is true on FreeWill (where 20 percent of plans include a charitable gift), and, to their credit, increasingly true at peers like Trust & Will and LegalZoom. Every plan completed on these platforms now includes a moment that asks what a person wants to leave behind, and millions of Americans are answering.

We ended our 2017 article by writing that a few practical efforts could launch a new era of philanthropic funding, and more of them have materialized than we expected. The demographics are certain, the tools work, and nonprofits have shown they can mobilize. What is still missing is patient capital for the thousands of organizations that cannot yet afford to build. If private foundations supply it, the missing trillions may be found after all.

The social sector has spent the last five years congratulating itself for discovering trust. Championing unrestricted grants, multi-year commitments, and deference to community judgment, trust-based philanthropy is now the field’s favorite innovation, complete with conferences, pledges, and a growing literature on why funders should stop treating grantees like suspects. Only two months ago, someone stopped me mid-sentence when I said “grantees” and asked me to use “partners” instead to honor this new trust and power dynamic.

The discovery is roughly 14 centuries late. In some traditions, longer.

Faith-aligned finance—including zakat, waqf, tithe, tzedakah, dasond, and other religious giving traditions—has operated as codified trust capital for centuries. These systems operate with a consistency, scale and nuance most institutional funders struggle to fathom, through mechanisms that took on the sector’s hardest problems long before the sector existed.

Development finance largely treats faith-aligned finance as a niche pool of capital to tap or faith institutions as delivery partners to enlist. However, the arrangements through which religious traditions govern giving, establish legitimacy, and hold stewards accountable are of greater value. These already exist within traditions. The unfinished work is connecting them with public and philanthropic financing without stripping away the obligations that make them meaningful. Development finance should study their design, not simply fundraise from it.

How I Learned This

I came to this through failure. In 2011, the Libyan revolution broke out. I was a final-year medical student in Zawia and founded Voice of Libyan Women, an organization that campaigned for inclusive security leadership and women’s agency. The team’s early work led with the language of international advocacy: rights, conventions, statistics. Embassies thought we were darling, but both they and the people who attended our events were already persuaded of our cause. For most families, the message was accurate, but it felt unauthorized; they heard it as something that arrived from outside the community’s moral framing.

So we rebuilt and reframed, working directly with Libya’s Dar al-Ifta, the national institution responsible for religious rulings, to formally endorse the Quranic verses and hadiths (sayings and traditions of the Prophet Muhammad) that supported women’s agency and leadership. The endorsement took more than a year—we showed up at their offices whenever they would see us and answered their questions on their terms and on their timeline—but it changed the source of authority behind the argument for women’s agency; what the community originally heard as an imported rights claim now carried religious legitimacy. It also opened doors to local funding. We then launched the Noor Campaign (noor means “light” in Arabic) as a public initiative of Voice of Libyan Women.

People in the oasis city of Sabha and people in the coastal city of Zawia hear each other very differently, so we also built city teams led by teachers, doctors, faith leaders, mothers, and young people whom local communities already trusted. Many told us that they had agreed with the organization’s position from the beginning but engaged only after we made it more socially acceptable for them to participate publicly.

Development practice often assumes that the binding constraint is supply, yet many well-designed interventions fail at implementation—vaccines expire in warehouses, books sit unopened. Despite cold-chain investment, intensive surveillance, and political negotiation, for example, Northern Nigeria’s polio resurgence in the early 2000s didn’t resolve until religious and traditional leaders helped rebuild public confidence, allowing immunization campaigns to resume. Similarly, the Noor Campaign meant that the same argument that had stalled for months traveled across the country—appearing in Friday sermons and on national television during Ramadan—in weeks. I came to think of “permission” as the collective social authorization that determines whether people feel they can act on an option that technically exists. I later called the distance between what communities materially need and what they feel morally or socially sanctioned to accept the “permission gap.”

I have watched the permission gap operate from every side of the table since. Leading a conflict-prevention firm, I saw its inverse. Where legitimate institutions vacate the permission space, violent actors can move into it, financing themselves through distorted claims on the very same sacred obligations. Trust is not inherently virtuous; the same combination of moral authority, networks, and capital can legitimize exclusion as readily as access. Transnational “family values” campaigns, funded by religious networks in the United States and Netherlands, demonstrate this across parts of Africa. The case for engaging faith-aligned finance rests on its influence, not its moral exceptionalism: Faith shapes who gives, whose judgment carries weight, and what communities consider legitimate. Those are forms of power that any serious account of development finance has to take seriously.

Years later, directing global advocacy and policy at one of the world’s largest foundations, I watched the gap manifest at institutional scale. Immaculately designed technical programs underperformed wherever uptake required that people act against the principles they understood their faith or community sanctioned. What startled me wasn’t the pattern; Libya had taught me that a decade earlier. It was the altitude at which it survived. Permission was often absent from program design because the tools organizations used to plan programs did not see it.

The Original Trust Architecture

Faith-aligned finance can help close the permission gap by embedding religious legitimacy in the financing itself. Consider zakat, a Quranic obligation requiring that Muslims transfer 2.5 percent of qualifying wealth each year. The Quran specifies eight categories of eligible recipients, including the poor, the indebted, and those in bondage, creating an eligibility standard set at origin and resistant to donor or institutional drift. The obligation is enforced primarily by conscience rather than a revenue authority, and conscience is a remarkably effective collector: Humanitarian financing analyses describe zakat as one of the largest sources of humanitarian funding in the world. Estimates of total annual giving range from $200 billion to $1 trillion. Even the lower estimate exceeds all tracked global humanitarian assistance several times over.

Waqf, its endowment counterpart, solves for perpetuity by permanently dedicating an asset to a charitable purpose. As governments rise and fall, its principal cannot be sold, seized, or repurposed. For example, Al-Qarawiyyin in Fez, founded by Fatima al-Fihri in 859 and sustained through waqf, remains among the world's oldest continuously operating universities. Accountability has a religious dimension: A zakat payer understands the transfer as a religious obligation, and the intermediary holds a responsibility that is both fiduciary and sacred.

Taken together, these mechanisms address problems conventional philanthropy repeatedly struggles with, including who is eligible, what the money may be used for, how long the obligation lasts, and who the steward is accountable to. They also attach legitimacy to the capital before it arrives.

I call this potential advantage the “permission premium.” It can operate at two points: when a giver recognizes a financing structure as a legitimate way to fulfill an obligation, and when a community recognizes that the services it supports are legitimate to use. Evidence of the first does not, by itself, establish the second.

The Permission Premium in Practice

The Noor Campaign left me with a recurring question: What if philanthropy treated faith institutions not merely as messengers or implementers, but as part of the infrastructure determining what communities trust, finance, and use?

In 2022, I began pitching a financing vehicle built on that premise, and after more than a year of building a strategy, financing model, and coalition, I created For Mama, the first zakat-eligible, Muslim-led funder collaborative for maternal and newborn health. The collaborative made maternal and newborn health legible within zakat giving, and raised $13 million in our first Ramadan campaign. Across three Ramadan campaigns, For Mama, now known as Every Pregnancy, has raised $125 million from more than 190,000 individual donors, including many outside traditional global health financing.

The multilateral system has also built structures that make participation religiously legitimate for donors, if unevenly. UNHCR’s Refugee Zakat Fund, which launched in 2017, has dedicated rules for collecting and distributing zakat. Islamic legal opinions known as fatwas, support these, giving donors a way to fulfill a religious obligation through a compliant structure.

Capital markets offer another example. When the International Finance Facility for Immunization, which raises capital-market financing for Gavi, the Vaccine Alliance, issued its first vaccine sukuk (an investment certificate that’s compliant with the body of religious law called Sharia and is often compared with a bond) in 2014, it raised $500 million—the largest debut sukuk of its kind. A second issuance raised $200 million the following year—roughly three-quarters of a billion dollars, mobilized through an instrument the development establishment still files under “niche.”

The evidence isn’t universal, but where faith-aligned instruments are governed credibly, they repeatedly mobilize capital by embedding religious legitimacy, donor intent, and accountability into the instrument itself. The pattern extends far beyond Islam. The Franciscan monti di pietà of 15th-century Italy are described as precursors to modern microcredit. The Jewish tradition of interest-free lending inspired the Hebrew Free Loan Societies, and New York's has operated since 1892. The Buddhist Tzu Chi Foundation began in 1966 with 30 Taiwanese housewives saving coins in bamboo banks and grew into a major global humanitarian organization. Even modern environmental, social, and governance investing partly descends from faith-aligned financing, including Methodist and Quaker investment screens. Across traditions, the architecture differs, but the design principle—that shared moral commitments shape how institutions raise, govern, and sustain capital—recurs.

The Missing Infrastructure

In my work on financing maternal health, child flourishing, displacement, climate, and humanitarian response, I find that prospective funders usually agree on the need. What they lack are structures capable of satisfying fiduciary and religious obligations at the same time. In commercial Islamic finance, bodies such as the Accounting and Auditing Organization for Islamic Financial Institutions and the Islamic Financial Services Board have developed standards that help institutions assess financial products and governance across markets. For faith-aligned social finance, the practical challenge remains: How can institutions operating under different religious and fiduciary rules finance the same project?

Building blocks exist. UNHCR, for example, has built dedicated accounts, eligibility rules, compliance review, and religious guidance for its Refugee Zakat Fund. But it doesn't provide a framework for co-financing. If a government, a local zakat institution, a waqf trustee, a philanthropist, and a development finance institution all want to finance the same maternal health facility, they may have no common basis for determining which costs are zakat-eligible, how a waqf can endow or hold the asset, or what evidence will satisfy a Sharia board, foundation trustees, and an investment committee. Getting them into a single structure today would require months of bespoke legal, scholarly, and financial work that most deals do not survive.

This helps explain an apparent paradox. Hundreds of billions may move through zakat each year, yet formal zakat institutions are estimated to capture only $10 billion to $15 billion of total zakat giving. Read carelessly, this looks like inefficiency awaiting formalization. But it is the thesis in miniature: Givers need confidence that their money reaches eligible recipients and is distributed according to the rules of the obligation. Some gain that confidence by giving directly to people they know; others rely on a local institution or a larger fund with credible religious oversight and clear reporting.

The task for development finance is to design accordingly and meet those requirements, not assume that institutional scale itself earns trust. What is missing is the connective tissue.

What To Do About It

Before a foundation or government commits money to a program, it decides whom the program will serve, how people will access it, which organizations will deliver it, and how they will measure success. This is the moment when it should also ask: Whose trust does this program need to earn before people will use it, and have those people helped shape how it is financed and delivered? Too often, faith leaders enter a program after its design is fixed, asked to endorse a vaccination drive or announce a clinic they had no hand in shaping. By then their role is persuasion, with little room to change the decisions that may have made the program unacceptable in the first place.

Asking early may reveal barriers that a communications campaign cannot solve after a clinic has opened or a program has launched. UNICEF’s Faith for Positive Change initiative, which builds influence mapping, faith engagement, co-design, and measurement into program design offers one approach to involving faith communities in program planning and implementation.

Beyond individual programs, the field faces the larger question of how different financing systems can work together. Here, climate finance offers a useful precedent. Green Bond Principles gave issuers and investors a common framework for identifying eligible projects and reporting how funds were used. Indonesia’s sovereign green sukuk shows what this can look like in practice: a Sharia-compliant instrument built against a green-finance framework legible to conventional, Islamic, and sustainability investors alike.

Faith-aligned and conventional institutions can build the missing architecture: agreed processes for determining zakat eligibility, waqf-compatible legal templates for development assets, and measurement frameworks that allow Sharia boards and investment committees to assess the same opportunity. Governments should meanwhile identify public priorities that these structures could finance, clarify how waqf assets and public funds can legally sit alongside other capital, and set clear rules for oversight. Larger funders should bring real projects and say what would make them willing to co-finance them, and philanthropists can provide catalytic capital to test the structures.

A practical starting point is to agree which costs each source of funding can cover. For a child-health program, that could mean establishing which services for eligible children zakat may finance, subject to the relevant religious approval, and which remaining costs government or philanthropic funding would meet. Each contributor could then support a shared objective while retaining its own obligations and accounting.

At the same time, researchers should test the permission premium rather than assume it exists. On the financing side, the question is whether these structures attract additional giving, redirect existing giving, or sustain support over longer periods. On the service side, researchers should compare otherwise similar programs and examine whether people know how they are financed, whether that knowledge affects their trust, and whether it influences their use of services. Those comparisons must account for differences in quality, cost, access, and community engagement. Researchers should also examine whether these structures sustain funding over time. I’m currently building toward that evidence through a multifaith compact and an interfaith financing facility that put these principles into practice for children’s survival and flourishing.

The scale these shared structures could unlock matters. If even 1 percent of the most conservative zakat estimate flowed through them, it would mean $2 billion a year for children—capital that can grow precisely because it is native to the contexts where permission binds hardest. The larger opportunity is to enable faith institutions, governments, and philanthropies to finance shared public priorities repeatedly, without rebuilding the legal and financial arrangements for every project. The real value should be judged by what they make possible for the people they serve.

From building the Noor Campaign in Libya to creating For Mama, I’ve seen what changes when people recognize the values and obligations built into an initiative. Too often, development finance asks communities to trust structures designed without them. The sector’s trust deficit is partly the legacy of financing structures that still presume communities must prove themselves to distant funders. Faith traditions have spent centuries building ways to give, govern, and account for money through shared commitments, and that architecture deserves to shape what we build next.

When organizations consider merging, the first question is always about purpose: do we share the same mission? But the more urgent question, the one that determines whether a merger actually happens, is why now?

In the cases of our organizations and the mergers we were recently involved in, we had two very different answers. For Resolution Project and Enactus, global nonprofits that merged in January 2025, the urgency was organizational: Enactus faced an existential financial threat that could have ended the organization entirely. For Girl Rising and She’s the First, which also merged in 2025, other challenges were on the horizon: preparing one organization for transition out of founder leadership and, for both, navigating an increasingly unstable sector. The long-term collateral damage from the defunding of USAID and other major international development agencies, as well as the growing headwinds for work focused on women and girls globally, demanded new strategies.

These look like different stories—financial collapse versus a leadership transition and geopolitics—but they share a structure. In neither case did mission alignment alone cause the merger; a visible existential question did. It didn’t have to be immediate, and it didn’t have to be financial. It just had to be enough that leadership could no longer treat the future as something that would sort itself out.

This distinction matters because the nonprofit sector tends to recognize only one type of merger: the last-minute rescue, the handshake deal when the lights are about to go out. But some of the most strategic mergers happen when organizations are still healthy—when founders can see around the corner and choose to act before crisis hits.

Between 2023 and 2025, we led two very different nonprofit mergers. The contexts were different. The execution challenges were different. But the core principles that made both mergers work? Those were universal. And the mistakes we made? Those cut across both experiences too.

Here’s what we learned about what comes after “yes.”

What Aligned: The Non-Negotiables

Mission came first, but complementary assets made it viable.

In both cases, we started with deep alignment on purpose. Resolution Project and Enactus shared a commitment to youth social entrepreneurship. Girl Rising and She’s the First both existed to advance girls’ education and empowerment globally. But mission alignment alone doesn't create a compelling merger—plenty of organizations share a North Star without needing to join forces.

What made these mergers attractive was complementarity, not redundancy. Resolution Project and Enactus met young people at different points on the same journey. Enactus introduces students to social entrepreneurship through university teams that build projects and compete on national and world stages. Resolution Project picks up from there: Our fellowships give emerging leaders seed funding and sustained mentorship to launch a venture, and the Accelerating Impact Challenge helps those ventures become revenue-ready. Girl Rising and She’s the First overlapped in geographic focus but worked in different parts of a girl’s ecosystem to transform communities—one focused within the school system, the other on mentorship settings outside it. The result: We did not have to make painful decisions about which programs to keep or discontinue. Instead, we could offer participants an expanded continuum of support.

We also filled each other’s operational gaps. Girl Rising brought sophisticated monitoring and evaluation infrastructure that She’s the First—operating on a $1.5 million budget—had never been able to afford. She’s the First brought best-in-class practices for involving girls directly in governance, including two board seats for program participants. Resolution Project and Enactus each brought funding relationships the other lacked, creating better diversification on the other side of the deal; both worked with university students but Enactus was embedded on campuses while Resolution Project orbited through partnerships with scholarship programs and leadership summits.

Leadership humility unlocked the deal.

In both mergers, ego could have killed the conversation before it started. Instead, leaders put mission above organizational identity. For Resolution Project and Enactus, that meant George and the Enactus leadership acknowledging that survival required letting go of independence. For Girl Rising and She’s the First, it meant Tammy stepping aside as CEO while her co-CEO transitioned into a VP role within the larger organization—a significant shift, but one that created a sustainable path forward.

It also meant being honest about power dynamics. In Enactus’ case, Resolution Project was clearly the acquirer, but what we were acquiring was not a single organization so much as a federation. Enactus Global supported 30+ country offices, all of them independently governed and funded, along with the faculty advisors, corporate partners, and alumni who had sustained the network for decades. Each of those constituencies had to decide for themselves whether to trust a smaller, younger organization from New York. And the risk on our side was real but hard to size: We were inheriting a global brand with a mixed financial history, a long-standing World Cup event with significant fixed costs, and obligations to country affiliates whose own health varied widely. In Girl Rising and She’s the First’s case, the power dynamic was intentionally balanced—50/50 board representation, co-branding that blended each organization’s primary brand colors, a revised mission statement that integrated She’s the First’s cherished words “educated, respected, and heard.” Neither organization went "under" the other; rather, they built something new together.

Boards championed the vision.

None of this would have been possible without board members who understood mergers, trusted the process, and weren’t intimidated by diligence. Girl Rising’s board had witnessed a successful merger seven years earlier and had a board chair who came from that previous organization’s board. She’s the First’s board chair had formerly worked for Girl Rising in its days as a film production company, and even inspired the initial merger conversation. All of our boards had members with for-profit and nonprofit M&A experience who could see past the risks to the long-term gains.

Our board chairs believed in collaboration over competition. They championed merger exploration from the first spark, and they stayed committed through 18 months of uncertainty (in Resolution Project’s case) and nine months of integration planning (for Girl Rising and She’s the First).

The driver isn’t always financial.

Enactus’s existential question was loud: a cash shortfall serious enough to threaten the organization’s survival. She’s the First’s was quieter, but no less consequential. Tammy had been thinking about succession since 2022. In January 2025, the organization brought on a co-CEO, intentionally building toward a future in which leadership would pass to someone else. A merger wasn’t on anyone’s radar before that point—it simply hadn’t been modeled as a path. But once it entered the conversation, it offered something a straightforward leadership transition couldn’t: a way to honor a succession plan already underway while building a stronger organization for the next leader to inherit.

This is the pattern we want the sector to see. Mission alignment is necessary, but it doesn’t explain why a merger happens when it happens. Something has to put the status quo in question. For Enactus, that something was a budget crisis. For She’s the First, it was the recognition that leadership can't stay static forever, and that good succession planning means building toward a transition deliberately, rather than waiting for circumstance to force one.

What We Underestimated: The Hard Truths

Internal communications were harder than we expected—in different ways.

For Resolution Project, the challenge was duration. Given Enactus’ financial duress, we sprinted eight weeks to a term sheet, but then came 18 months of “when is it final?” Staff turnover was significant. Donor anxiety was palpable. The “not-so-secret secret” phase helped for a while—people knew something was happening, which paradoxically made internal and external communications easier—but once the announcement was made, the long road to formal closure tested everyone’s patience.

For Girl Rising and She’s the First, the challenge was a period of high confidentiality in a culture that values transparency. As CEO, you can see the long-term vision a merger is solving for. But for staff who don’t have that vantage point, or who are simply thinking about their day-to-day lives, such a major change can create disruptive anxiety. Believing we were acting in our team’s best interest, we kept early merger exploration confidential and stayed upbeat once the merger was announced. We didn't make space for grief or nerves.

Months later, at a Girl Rising in-person retreat, facilitators led a “Stinky Fish” exercise: Staff wrote their anxieties on Post-its and placed them on a whiteboard over a cartoon fish. It was eye-opening. Concerns surfaced that hadn’t been on leadership’s radar—worries about job security, questions about organizational culture, fears about losing the intimacy of a smaller team. Had we created space for those feelings earlier, we could have addressed them proactively and avoided the time and strain of later course corrections.

The math doesn’t always add up the way you expect.

Here’s a truth the sector doesn’t talk about enough: Mergers often mean contraction, not growth, at least for a period of time.

Resolution Project had a $3 million annual budget. Enactus had an $8-10 million budget. The joint entity? $6.5-7 million. That’s a reduction of roughly 36 percent from the combined total. Some of that was intentional—eliminating redundancies and focusing resources. Some of it was inevitable—donor goodwill lost and funders who didn’t follow us through the transition.

Girl Rising and She’s the First had combined budgets of approximately $4.7 million in 2024. The merged entity is budgeted at $3.5 million this year, a reduction of 25 percent. Even in the best-case scenario, mergers don’t guarantee explosive growth. They create a stronger, more sustainable organization with better infrastructure and a more compelling funding case. But the path there often runs through contraction first.

Financing mechanisms are woefully inadequate.

Both mergers required significant investment just to make the deal viable. Resolution Project needed $2.5 million in catalytic funding—for legal costs, integration planning, staff transitions, and operational continuity during the merger period. Girl Rising and She's the First needed, at minimum, $100,000 in merger costs and were fortunate to secure pro bono legal support (valued at nearly $700,000) and additional gifts from existing donors specifically for this purpose.

Without that capital, neither merger happens.

And yet, there is almost no funding infrastructure for nonprofit mergers. Foundations love to talk about efficiency and impact at scale. But when two aligned organizations try to actually consolidate for greater effectiveness? The money isn’t there. Or it’s available in amounts too small to make complex mergers viable across the sector.

We got lucky. We had trust-based donors willing to take a bet on us and we both received investment from the SeaChange-Lodestar Fund for Nonprofit Collaboration, which solely funds formal partnerships like mergers and joint ventures.

Eliminating all uncertainty in advance is impossible.

In both mergers, we had to navigate through a common trap: trying to eliminate all uncertainty before moving forward. What will the new org chart look like? Which programs stay? Which staff roles change? What’s the three-year budget model?

These are important questions. But the desire to answer all of them perfectly before signing the agreement can kill momentum. Trying to mitigate every risk in the due diligence process—on both sides, in both mergers—was one of the biggest hurdles we had to clear, even with supportive boards. For example, with limited multi-year grant commitments, we couldn’t promise what the financial picture would look like in year two or three. At some point, you just have to move forward with incomplete information. Choose a merger partner whose values align closely enough that you trust you’ll handle unexpected issues responsibly together.

What the Field Must Change

Funders need to step up with money for merger costs.

If the sector is serious about sustainability and impact at scale, we need a financing infrastructure for nonprofit M&A. $50,000 planning grants and pro bono legal support (which only the more well-connected nonprofits can access) are useful but they don’t move the needle on their own. We need flexible grants—in the range of $1-3 million for complex mergers—to cover legal costs, integration planning, communications, staff transitions, and operational continuity.

This is investment in long-term impact. According to La Piana Consulting, 92 percent of organizations that pursue strategic partnerships with intention consider them a success. The ROI is there, but the capital isn’t. This is a huge missed opportunity.

Recent developments suggest the landscape may be shifting. In March 2026, the Sorenson Impact Institute launched a Collaboration Fund backed by the Ford Foundation and MacArthur Foundation—$1 million specifically for mergers, acquisitions, and strategic collaboration among impact investing nonprofits. The fund covers integration costs, legal fees, and staff transitions—exactly what's needed. But $1 million pooled across an ecosystem is still a fraction of what complex mergers require.

Foundations that fund capacity building should view merger financing as core to that work. Trust-based donors who believe in organizational sustainability should treat merger costs as a legitimate use of unrestricted funds. Intermediaries should create dedicated funds specifically for M&A in the social sector—and size those funds to match the actual complexity and cost of doing this work well.

We need new mental models about what consolidation means.

The sector treats mergers as signs of failure—organizations that couldn’t make it on their own, forced into shotgun marriages to avoid collapse. That narrative serves no one.

Yes, some mergers are crisis-driven. But others are strategic bets on greater impact. Some solve leadership transitions that would otherwise leave strong organizations adrift. Some create the infrastructure smaller organizations need to attract larger grants and sustain long-term programming.

It’s also very hard work to launch and build organizations. Founders don’t have infinite reserves of energy. The sector and funders lionize founders, but one of the best ways to honor their hard-earned impact is to support pathways that can give them a break and bring them back to the sector again.

We need to normalize merger exploration as a tool in the strategic toolkit—a proactive choice leaders make when the conditions are right. That means talking openly about the benefits (stronger organizations, better funding cases, expanded programmatic reach) and the costs (staff turnover, donor anxiety, the emotional toll of organizational change).

It also means being honest about what mergers require: mission alignment, complementary assets, leadership humility, board champions, adequate financing, and a tolerance for uncertainty that most nonprofits aren’t structured to handle.

Tolerance for uncertainty has to increase—on all sides.

Merger timelines are long. Resolution Project’s deal took 18 months from term sheet to closure. Girl Rising and She’s the First’s took seven months from public announcement to closure. During that time, staff are anxious. Donors are watching. Stakeholders are waiting for clarity you can't yet provide.

The sector—funders, board members, staff, beneficiaries—needs to accept that this is part of the process. You can’t answer every question up front. You can't eliminate every risk. You can build trust, communicate transparently about what you know and what you don’t, and create structures to navigate uncertainty together.

A Different Story

Twenty-one months after Resolution Project and Enactus signed their term sheet, the merged organization is operating at scale with greater programmatic reach and a more diversified funding base. Eleven months after Girl Rising and She’s the First announced their merger, the joint entity is impacting more girls’ lives across the globe and meeting needs in more innovative ways. Our integrated programming has drawn attention and support from catalytic new funders.

The nonprofit sector is facing an increasingly uncertain future—political volatility, funding constraints, rising operational costs, leadership transitions in organizations built around charismatic founders. Mergers won’t solve all of those problems. But for organizations with genuine mission alignment, complementary assets, and leaders willing to put ego aside, they offer a path forward.

What develops a student’s capacity for systems leadership?

In 2023, a team of Wesleyan University first-year students placed first out of nine hundred entries worldwide in the University of Oxford’s Map the System (an international competition that asks students to research a complex social or environmental issue). The following year, another team of Wesleyan first-years won again, against more than 130 teams from 17 countries. Wesleyan is the first institution in the competition’s history to win twice, both times through the Patricelli Center for Entrepreneurship, which I direct.

Universities have often measured entrepreneurial success by the number of venture-backed companies their students create. PitchBook’s annual university rankings, for example, measure programs by the number of venture-backed founders they produce (which tends to favor schools like UC Berkeley, Stanford, MIT, and Harvard, with large graduate programs and proximity to venture capital). But none of the Wesleyan students I advised pitched a startup. None of them raised capital. None of them built an app. They produced systems analyses and were judged by panels of practitioners and academics to have done it better than teams from hundreds of other universities worldwide, many competing at the graduate level.

There is, of course, nothing wrong with a venture-backed startup. Many of our students will build companies, some at significant scale, and the Center invests seriously in those who do. The Patricelli Center for Entrepreneurship changed its name from the Patricelli Center for Social Entrepreneurship, an expansion of our mandate, because, as Bob Patricelli put it at our rededication, “The scale of change on all fronts now demands that we prepare constructive leaders and institution builders in all sectors—business, nonprofits, government, and beyond.”

We believe, however, that if the measure of success for an undergraduate entrepreneurship center is the production of unicorns, then it will be an ecosystem optimized for that specific output, not primarily an undergraduate entrepreneurship program. Instead, we seek to form leaders who can examine their own positionality, deeply understand the systems they want to change, and engage with power (and not just critique it). By the unicorn measure, a student who never starts a company but goes on to reshape a public agency, lead a community organization, or change how a corporation treats its workers is invisible. The frame we use to measure entrepreneurial success must be broader.

Teaching Power

As one of the highest expressions of personal agency, entrepreneurship is inextricable from power. It has always been about power. The work is to teach our students to engage it. In Power for All, Julie Battilana and Tiziana Casciaro argue that power is not under the unique ownership of a few, but rather a dynamic that anyone can learn to identify, navigate, and build. But while entrepreneurship education teaches students to generate ideas, test them, and pitch the results, it has rarely prepared them to understand the distribution of power that may impact the ventures they hope to build (much less how they define their relationship to it).

That is a core deficit. Students receiving an entrepreneurial education should be well versed in how power manifests, persists, who holds it, and how it evolves. They must be equally capable of defining their own relationship to it: whether engaging it from the outside, building it from within, or both at once.

Three practices make that possible: exposure, experimentation, and activation. Exposure features direct, sustained encounters with leaders who have engaged power across sectors, disciplines, and life circumstances, often beyond the conventional entrepreneurial path. Then, students must have real resources and structured space to experiment with their leadership capacity, asking tough questions like, how does power manifest in my daily life? My career plan? Finally, students can choose how or whether they want to activate this capacity. In this way, the pitch deck and business plan become tools for this process, rather than the goal from the beginning.

Three years ago, we launched a course around this process, with a simple premise: 18 case studies—built for the course from tens of hours of interviews—paired with weekly exercises around power, storytelling, and leadership. Each week students study a leader’s lived experience, and then they interview that leader as a collective.

Nearly half of the 27 leaders who have visited the course are Wesleyan alumni, creating a multigenerational network of practitioners, who have led in unconventional ways, brought into direct contact with students still figuring out what their own leadership might look like. I have worked to connect students with visionaries in a variety of sectors like UN global communications, network television, refugee resettlement, venture capital, climate investing, hip-hop and ballet, museum curation, and diplomacy, among others. Power operates across all these spaces, and learning to engage with it requires encounters across contexts. The leaders are a constellation of the many ways a person can identify a problem and wield and mobilize power to find its solution. For example, Rashida Jones, former president of MSNBC and the first Black woman to lead a major cable news network, modeled what it looks like to build trust inside a complex system, and to set records doing it. Melissa Fleming, the UN’s Under-Secretary-General for Global Communications, showed students what it means to shape public narrative around the largest refugee crisis since World War II. The late Marc Pachter, former director of the National Portrait Gallery, shared how he saved one of the most important artworks in American history—the Lansdowne Portrait of George Washington—from being sold. Each case study is a different roadmap for students to engage with power, push back against it, or incorporate it into their lives.

The exposure, experimentation, and activation doesn’t always offer a clear route to attracting venture funding. But at their best, they produce something harder to measure: a student who knows which problem is theirs, why it is theirs, and what they are prepared to do about it.

The Path Forward

When the 2025 team began their project on the water crisis in Jakarta, the obvious frame was scarcity: a megacity sinking, millions without clean water. Through months of conversation with residents, researchers, and policy leaders, they discovered that it was a dual crisis: subsidence driven by groundwater extraction (by those who could afford private wells) was experienced simultaneously with infrastructural failure that left poorer residents dependent on that same extraction. That insight only emerged from sustained engagement with a problem that, from a distance, looked like one thing, but was in fact two things in tension and contradiction.

The problem was never water scarcity as a single challenge; it was all about how water was distributed and produced, and the power structures which kept the inequality in place across centuries.

The 2023 team’s analysis of child marriage did the same kind of entrepreneurial work: the kind that requires deep systems understanding, honest engagement with power, and the standing to make a claim about what is actually happening.

Priyanshu Pokhrel ’26 arrived at Wesleyan, for example, already knowing which problem was hers—menstrual stigma in Nepal, where cultural restrictions on women during menstruation shape daily life. The most extreme form of those restrictions, chaupadi, confines girls to outdoor huts during their periods.

In the summer of 2023, Pokhrel and her co-founder spent more than a week conducting field interviews with teachers, local health workers, and government officials in the Syangja district. They found that the Nepalese government had already mandated free menstrual pads for every public school in the country, but also that the policy lacked proper implementation, such that pads sat in back rooms, unused and deteriorating. Years earlier, the national curriculum had been stripped of health education entirely.

Pyari, the company Pokhrel built from that experience—works to address this gap, designed from the specific context of the community it enters: from the language and the relationships that already exist to the local power dynamics. These dynamics are often complicated by competing stakeholders, so Pokhrel and her team studied power structures in place, building trust by incorporating local expertise into programming.

Pokhrel often speaks of a boy in one of her workshops who wrote a poem about his mother and about the worry he carried every time her period meant she had to leave the house. In its first seven months, Pyari reached more than 1,700 people directly and 60 million online. Pokhrel received a $10,000 Davis Projects for Peace Prize and a $6,000 New Venture Award from the Patricelli Center. She graduated this year.

Last year, Hatch Africa’s chickens produced 4.5 billion eggs across six countries. What began in 2010 as a single poultry farm in northern Ethiopia has since put supplemental income in the pockets of thousands of smallholder farmers, improved nutrition for children, and built a new market for affordable protein. And it did all of this as a profitable company.

By any measure of what impact investing exists to do, Hatch is a remarkable success. But the simple rubric of “is it a unicorn?”—a company with a $1 billion valuation—misses all of the above. For Hatch was designed to be something we don’t yet have a name for but that matters greatly if we are to build a world that puts people and planet, not just profit, at the center.

I started Acumen 25 years ago, before the impact investing sector had a name, on the conviction that markets and capital, used with patience and moral imagination, could solve some of the hardest problems of poverty. Over the years, my colleagues and I have been asked repeatedly how many unicorns we’ve produced—at investor conferences, in due diligence meetings, by journalists looking for a hook. Fund managers increasingly get benchmarked against venture-style return multiples, even when their mandates are built around patient, concessionary capital. The honest answer is humbling. Of more than 240 companies we’ve backed, exactly one—Esusu, which is dismantling barriers to housing and helping close the racial wealth gap—has reached a billion-dollar valuation. We are deeply proud of Esusu. But the prevalence of the question itself points to how much the impact sector has given way to Silicon Valley’s definition of what it means to succeed.

The Unicorn and Its Discontents

By borrowing the unicorn, the impact world also inherited much of the incentive architecture of Silicon Valley. As impact investing matured and went looking for legitimacy, a billion-dollar valuation became shorthand for ambition, proof of scale—the sector’s evidence that it belonged at the grown-ups’ table.

But with the unicorn, it imported more than a metric. It imported scale thinking and a culture. Move fast and break things. Burn capital to capture market share. Treat your earliest customers as experiments. That operating philosophy can work well enough when you’re building software in a developed market with consumer protections and customers who can absorb the cost of your mistakes. It can do real harm when you’re building off-grid solar or delivering agricultural inputs to people living on $3 a day. This is not hypothetical: The Andhra Pradesh microfinance crisis of 2010 and the collapse of several off-grid solar companies in the 2020s offer cautionary lessons in what happens when growth-at-all-costs logic meets fragile communities.

A billion-dollar valuation is a single metric. It is forward-looking, purely financial, and blind to almost everything else a company—or a society—might value. Valuation tells us a great deal about what investors expect to gain. It tells us nothing about whether the world is meaningfully different because that company exists. The economist Mariana Mazzucato argues that we've lost sight of what value really means; a price is not the same as worth.

Consider what the unicorn metric renders invisible. Acumen’s portfolio has reached nearly 800 million low-income people, created hundreds of thousands of jobs, built entirely new markets, and reshaped systems for people the global economy had long overlooked. None of that registers if your scoreboard only counts valuation.

Our sector has felt this dissonance for some time and has reached for alternatives. “Impact unicorn” tried to marry mission to valuation. The zebra, too, emerged as a counterframe—a company that is both profitable and purpose-driven, mutualistic rather than winner-take-all. These were thoughtful attempts to solve a real problem. None has yet given the field what it most needs: a rigorous and resonant way to recognize the organizations that actually change the world, and to connect them with the investors who would back them.

What a Better Framework Might Look Like

If valuation is the wrong measure, what’s the right one? I’d start with a single question: Is the world meaningfully different because this organization exists?

From there, I can imagine at least five dimensions worth measuring. Reach—how many lives are touched. Depth—how fundamentally those lives are changed. Durability—whether the model can sustain itself without permanent subsidy. System effects—whether norms, markets, or structures have shifted in ways that outlast and outrun the organization itself. And financial resilience—whether the enterprise can endure and grow on its own terms.

I’ve also been thinking about what we might call an organization that meets those criteria. A butterfly. Not a mythical creature in an enchanted forest, but a real-world process of change. The best social impact work looks like a chrysalis: slow, unglamorous, often invisible—and then suddenly the world looks different. In chaos theory, the butterfly effect describes how a small change in one part of a system can produce enormous consequences far away, which is precisely what happens when an organization shifts a norm, rewrites a law, or rebuilds a market. The change travels far beyond the reach of the organization’s own wingspan. Think of Sun King and d.light, the solar pioneers who together have brought electricity to more than 300 million people. Or Hatch, and Esusu, and BURN, a clean cookstove company that has saved millions of trees and improved the health of millions of people who relied on dirty cooking fuel. Each, by this measure, is a butterfly.

There are other measures worth considering: Replication fidelity—does the model travel without its founder? Generativity—does it create conditions that independent actors can build on without the original organization in the room? And balance over extraction—does it take only what it needs, the way a butterfly feeds on nectar without harming the flower?

The organizations that create the most durable social impact often grow deliberately, rebuild rather than disrupt, and serve markets that don’t scale at the same rate as software. That’s a feature. Maybe social enterprises in general are fated to be smaller. So the question isn’t why the impact sector has so few unicorns; it’s whether unicorn was ever the right measure. Companies that prove it’s possible to deliver audacious social change and long-term financial sustainability deserve a language, a metric, and a measure of success worthy of what they’ve built.

Labels Matter

When I entered business school in the late 1980s, Bill Drayton of Ashoka had begun to popularize “social entrepreneurship,” but terms like impact investing and patient capital didn’t yet exist as things a young person might aspire to. If you wanted to pursue that path of using business in service of social change, you needed to walk on uncharted territory. There were no guideposts, and there was no language for what some of us dreamed of doing.

Names matter more than we think. They give shape and legibility to ideas, and help direct society’s talent and ambition toward what we’ve decided is worth labeling and pursuing.

“Entrepreneur” spent centuries as a specialized economic term, but it wasn’t until the 1980s that it became a global cultural identity that millions now aspire to. Microcredit and microfinance described a practice that had existed in various forms for generations before Muhammad Yunus systematized it and carried the name across the world—and in doing so helped create a global financial inclusion movement. Closer to home, “impact investing” was coined in 2007. Within a decade it had an industry association, university curricula, and billions of dollars in dedicated capital flowing toward it. “Patient capital”—a term we at Acumen helped popularize—gave funders permission to think differently about time horizons and return. In 2007, Thomas Friedman devoted a New York Times column to patient capital, helping carry the idea beyond our sector and into the mainstream.

Each of these naming moments did more than describe something that already existed. They made the thing easier to see, easier to fund, easier to pursue. (In some cases, the definitions of terms like social entrepreneurship and impact investing became so popular and inclusive as to lose some meaning.)

What We Celebrate Shapes What Gets Built

There is a logic here that we ignore at our peril. Metrics shape incentives. Incentives shape funding. Funding shapes what gets built, and who gets to build it. If the next generation of entrepreneurs and investors takes its cues from the success stories our field chooses to hold up, then we had better make sure those are the right stories.

For as long as I can remember, the world has held up a damaging binary, one that lingers even within the impact world: Maximize returns over here, give money away over there. Charity on one side, capitalism on the other. Under that framework, the poor remain permanently dependent on someone else’s goodwill. But our experience shows another way forward, one of impact-driven enterprises delivering both audacious social change and long-term financial sustainability. We don’t have to choose between the two. The companies that prove it’s possible deserve a language worthy of what they’ve built.

The performing arts sector is paradoxical: deeply innovative yet structurally resistant to change. While endlessly inventive onstage and behind the curtain, the organizational structures that support the creative work are notoriously slow to adapt, relying on legacy models ill-suited for today’s complex funding challenges.

According to the 2022 Arts and Economic Prosperity report, over 80 percent of Americans believe the arts to be important to their local economy and their community’s livability. But in May 2025, calls by the Trump Administration to close the National Endowment for the Arts (NEA) led the agency to abruptly withdraw or cancel hundreds of grants awarded to arts organizations across the United States. Organizations of all sizes reacted by cutting expenses and seeking more earned and contributed revenue, with some dipping into their endowments and using working capital to fill the gaps. This response illustrates what the field has known but not fully addressed: Years of persistent underfunding have made for deeper, structural frailties in the financial well-being of the performing arts.

As current and former performing artists, leaders, and consultants in the nonprofit performing arts industry—and as people who care deeply about coming together to reimagine the future of the field—we believe there is an underexplored economic lever available to the industry: the intentional building of strategic partnerships. Those who can take advantage of the range of possibilities partnerships offer will set the stage for more agile organizations and greater innovation across the field.

Challenges in the Performing Arts Industry

Performing arts organizations face two significant barriers to long-term sustainability. First, the cost of doing business has rapidly grown beyond what can be reliably covered by contributed and earned revenue. This phenomenon, known as the Baumol effect, was documented by economists William J. Baumol and William G. Bowen in their 1965 article, “The Performing Arts: The Anatomy of their Economic Problems.” They observed that the performing arts, like other labor-intensive sectors such as healthcare and education, will see cost growth that consistently outpaces sectors that can be automated. Translation: A week of symphonic music cannot become “more efficient.” Not only is it more expensive to produce art today than it was a decade ago, but the cost is rising faster than before.

Exacerbating the Baumol effect is “institutional exceptionalism.” Performing arts organizations often take a “go it alone” approach, positioning themselves as incomparably unique while simultaneously competing with their peers at the regional and national level. Rather than galvanizing public interest and demand for their art form, they focus on boosting their own brand. This exceptionalism reinforces competition for limited resources at the expense of the sector as a whole.

In this article, we discuss two antidotes to these historical stressors and then a mix of strategic partnerships to pursue to strengthen organizations. While the Baumol effect cannot be fully eliminated, its economic impact and the field’s entrenched institutional exceptionalism can be mitigated with new and strategic approaches to scaling. Capturing economic and organizational efficiencies requires two critical conditions: clarity of organizational purpose and a well-defined business model.

Antidote #1: Clarify Organizational Purpose

To partner with others, an organization must first understand what makes it special and, second, the role it plays in the larger ecosystem. Most performing arts organizations can articulate clear missions, visions, and values, yet many lack a clear purpose statement, which we define as the unique combination of an organization’s identity and its desired impact.

In her 2021 SSIR article, “The Four Principles of Purpose-Driven Board Leadership,” former BoardSource CEO and President Anne Wallestad urged boards to think about “purpose before organization” when considering how to allocate resources in service of their intended impact.

AXIS Dance Company offers a compelling example. Dedicated to creating a “radically inclusive dance sector and world by removing barriers and showcasing the beauty of difference,” AXIS has long collaborated with renowned choreographers to create works for its company of disabled and non-disabled dancers. Recognizing that it could not achieve its mission through performance alone, AXIS developed a comprehensive accessibility resource for the industry. Its Access Guide for Presenting and Touring the Performing Arts helps venues move beyond basic ADA compliance to design truly welcoming and accessible spaces. By leveraging its identity, AXIS expanded its impact beyond the stage to advance its purpose.

Performing arts organizations that clearly define their purpose are better positioned to make strategic decisions about how to operate within the field. This foundational work allows them to leverage their unique strengths, maximizing their impact both individually and collectively.

Antidote #2: Map the Business Model

If purpose defines identity and impact, the business model shows how that purpose is put into practice. Opera Philadelphia offers a tangible illustration. When Anthony Roth Costanzo assumed the role of general director and president, he did so with a commitment to “bring opera to more people, and bring more people to the opera.” He also inherited a company in deep financial crisis with a looming $4 million debt and an upcoming season with only 30 percent of tickets sold.

Understanding that earned revenue alone would not fully sustain Opera Philadelphia, Costanzo implemented a radical pay-what-you-can pricing strategy designed to create audience accessibility while building community relevance. Starting at $11, the “Pick Your Price” initiative was an immediate success, selling out the entire season in a few weeks.

Yet Costanzo knew financial sustainability would also depend on cultivating partners, generating philanthropic support, and increasing the company’s civic value. To achieve this, Opera Philadelphia launched partnerships across the city’s civic and cultural sectors, including with the Rodin Museum, Temple University, Jean-Georges Philadelphia, and the famed Wanamaker Building.

The results were significant: Costanzo’s first season ended with a $1.5 million surplus, allowing Opera Philadelphia to double the number of performances for its next season. Building on their initial ticketing strategy, the company introduced the Opera Pass program, with an impressive 40 percent of its members subscribing to the entire season. Though often viewed by the field as mere pricing innovation, Costanzo’s business model proved to be the mobilization of a clear purpose built and sustained through the ecosystem of community partnerships.

Building Together What We Can’t Build Alone

Aligning purpose and business model provides the foundation that performing arts organizations need to pursue strategic partnerships successfully. The matrix below illustrates a range of approaches spanning short- and long-term partnerships, from loosely coupled collaborations to tightly integrated alliances.

Organizations pursue partnerships for many reasons: to achieve marketing, artistic, or fundraising goals; amplify common causes; expand geographic reach; leverage resources and capabilities; reduce costs; or merge operations. The appropriate partnership structure depends on the purpose it is intended to serve. This matrix provides a framework for organizations to seek and execute realistic, meaningful, and cost-effective partnerships that align with their capacities and strategic priorities.

Coordinated Partnerships: Short-Term and Loosely Coupled

Coordinated partnerships are typically one-offs or time-bound initiatives designed to promote a shared goal or collaborate around a shared initiative. They capitalize on flashes of innovation that benefit all organizations involved. Coordinated partnerships can also mobilize resources to benefit the field as a whole, whether through a new production with a clear purpose, the generation of emergency funds, or the building of political capital. And even with limited integration, they generate more value than going it alone.

One example is the recent production of “Firebird” presented jointly by Dance Theater of Harlem and Gateways Music Festival, which operates in association with Eastman School of Music. Both organizations are dedicated to empowering multicultural and Black artists, not only showcasing their talent, but helping to redefine the cultural and aesthetic narrative in ballet and symphonic arts. Dance Theater of Harlem, a well-established organization in New York City, helped to elevate the brand of the non-local Gateways Music Festival by broadening its exposure around a shared purpose.

COVID brought many performing arts organizations together for short-term, loosely coupled initiatives. Chicago Acts Together gathered over 100 performing arts organizations for a joint fundraising initiative. Elsewhere, arts organizations banned together for advocacy purposes. In San Diego, 28 local theaters started One Theater, One Story, a collaborative campaign to survey audiences and advocate for artists’ relevance and survival needs. Similarly, more than 200 arts leaders in New York City had a daily “Culture @ 3” call to discuss ways to advocate for government support through collective action.

Interlocking Initiatives: Short-Term and Tightly Held

Interlocking initiatives involve dedicated resource sharing to support a specific goal over a defined period. Co-commissions are an increasingly common form of interlocking initiatives, bringing together geographically dispersed organizations to share the costs, risks, and administrative complexity of creating a shared new work for multiple stages. This is increasingly common in the co-commissioning of new operas, where the cost and complexity of new productions is especially high.

Recently, a first-of-its-kind collaboration between two pillar arts organizations in New York City, the Metropolitan Opera and Museum of Modern Art (MoMA), highlighted the life and art of Frida Kahlo and Diego Riviera. The Met’s production, “El Último Sueño de Frida y Diego” (“The Last Dream of Frida and Diego”), was coupled with MoMA’s exhibition “Frida and Diego: The Last Dream,” which presented their art in an installation designed by Jon Bauser, the opera’s set designer. This interlocking initiative showed that interdisciplinary collaboration not only elevates the audience experience but also generates revenue for both organizations.

Shared Orbits: Long-Term and Loosely Coupled

In shared orbits, organizations partner over a longer time horizon but remain loosely coupled to maintain ownership over programming and other strategic priorities. This allows for ongoing partnership possibilities while retaining organizational autonomy. The benefits of shared orbits are the deduplication of resources and their attendant cost savings, as well as the possibilities of expanded audience reach through cross promotion.

To coordinate this type of partnership, groups might create or designate an umbrella organization to provide back-end operational support for multiple arts organizations. For example, The Woodruff Arts Center (WAC) in Atlanta coordinates venue scheduling and provides centralized human resources and finance functions for its constituent organizations: Atlanta Symphony Orchestra, High Museum of Art, and Alliance Theater. This organizational structure generates significant cost savings while preserving the artistic freedom of each constituent institution.

Mergers and Alliances: Long-Term and Tightly Held

Mergers and alliances are the most complex form of partnership. When successful, however, the payoffs can mean the difference between organizational survival, continuing financial instability, or closure. They demonstrate how economies of scale at both the artistic and administrative levels can help organizations respond to Baumol-driven cost pressures while preserving and strengthening the cultural ecosystem they collectively serve.

In 2019, the Toledo Symphony Orchestra and Toledo Ballet (and, in 2024, the Toledo Jazz Orchestra) merged to form the new multi-disciplinary Toledo Alliance for the Performing Arts (TAPA). In integrating into one organization, the groups combined operations, unified their donor base, and aligned around a shared educational mission, thus leveraging economies of scale. The merger enabled TAPA to open a 56,000-square-foot facility that houses all administrative functions and education programs and expands available performance spaces in Toledo.

Alliances in performing arts are prevalent as smaller theater companies continue to rebound from the pandemic. They help mitigate cost pressures while preserving artistic identities. Philadelphia alone has produced two notable alliances built around shared artistic leadership. KC MacMillan is the artistic director for both the Inis Nua Theatre Company and Tiny Dynamite, while Allison Heishman has the same role across the Azuka Theatre and Simpatico Theatre. The impact of these alliances goes far beyond the cost savings of a split salary. By sharing artistic direction, the theater companies also coordinate artistic planning so that their individual productions draw continuous interest from the Philadelphia audience.

Where Do We Go From Here?

Strategic partnerships across the four archetypes of the matrix offer a pathway to a thriving, mutually reinforcing performing arts ecosystem. Beyond reducing duplication, sharing resources, and expanding reach, these models catalyze knowledge exchange, spur innovation, and fortify the cultural relevance and social impact of the field.

With clarity of purpose and well-defined business models, performing arts organizations can proactively identify and pursue an array of strategic partnerships. But to do this requires intentionality, effort, and organization design. One idea is for organizations to create a formal, cross-functional team that brings together artistic, development, marketing, and operations to identify, evaluate, and implement partnership opportunities. This team can assess potential collaborations, guide integration, and plan for ways to demonstrate impact. It’s important for individual organizations to build their own partnership muscles across silos in order to partner well with others.

While the performing arts will always strive for artistic excellence, the future of the sector increasingly hinges on the field’s capacity for collaborative intelligence, both within and across organizations.

More and more people in the social sector seem to believe that the government is the best or even only way to scale. In arguing that “Scale Really Matters,” for instance, Kevin Starr recently argued that government is “the only realistic doer at exponential scale,” and “the only realistic payer at scale.” But a variety of others take this approach, from “Accompanying Governments to Scale” to “Scale That Lasts” (on moving from government partnership to full country ownership); especially in a time of aid contraction, it’s common to see the argument that NGOs should take a “low-ego, low-logo approach and let the government both lead and shine.”

If government is one very important pathway to scale, however, the private sector—for-profit and not-for-profit alike—is another. And because there is more than one road to scale, it would be unwise to over-index on a single solution. It’s worth remembering, after all, that some of the most consequential anti-poverty technologies of the last thirty years—for example, mobile money, micro-insurance, pay-as-you-go solar, and digitally enabled pest detection—were neither developed nor scaled by a government.

In short, the pathway to scale depends on the nature of the problem, the context, and the actors involved.

From Mines to Cell Phones

In 2003, the Aga Khan Fund for Economic Development (AKFED) made a bet that few governments or aid agencies would: that a private national telecommunications network would be foundational to a modern economy, and that the private sector, not Big Aid and not a cash-strapped finance ministry, would be the one to build it.

That bet paid off. An AKFED project company, Roshan, cleared land mines to build cell towers (and rebuilt them repeatedly after insurgents blew them up), in a country where 99 percent of people lacked a phone. In the years that followed, Roshan would become the largest taxpayer in the country, employing 40,000 Afghans directly and indirectly, and providing opportunities to women who had few opportunities to work outside the home. It was a transformative investment by a private company committed to the long-term development of the country. Roshan went on to launch a national payments platform, M-Paisa, Afghanistan’s adaptation of Kenya’s mobile-money breakthrough, M-Pesa, facilitating person-to-person payments, commerce, and micro-insurance. Its Malomat service delivered real-time crop prices to farmers and its telemedicine program linked rural people to Afghan doctors and specialists outside the country.

Within only a decade, more than 90 percent of Afghans had access to a mobile phone. And equally importantly, a reliable and affordable network. None of this required big investments from a cash-strapped government or overstretched donors. What was required was government trust in a responsible private partner that was willing to take risks in a frontier market and use the power of markets to invest in economic, social, and human development.

Crucially, this had to be a private actor willing to deploy patient capital, take on risk, work with government and civil society, and invest in a long-term vision to build a world-class telecommunications network. This enabled thousands of other micro and medium-sized enterprises to build businesses on the network. What emerged were the conditions for broad-based economic development. In the years that followed, millions of Afghans had connectivity and access to health and education services, a payment platform, and multiple forms of media.

Finding the Balance

A responsible private sector can co-create with governments to do what the public sector cannot do alone. For example, government institutions generally do not outperform the private sector in payments, hardware and software development, and innovation at speed and scale. Of course, governments are vital in developing enabling conditions for businesses to start, grow, and scale, and drafting regulations that keep them honest. They must also ensure businesses pay taxes so infrastructure and public goods can serve a broader population.

But the task is to find the right mix between what governments do well directly, how to enable the private sector and civil society to thrive, and how to build institutions that survive regime change. Governments need to develop the muscle to govern, build legitimacy with their own people, and develop a domestic tax base; if they do not, they will over-rely on external assistance and become vulnerable to collapse. Afghanistan, for example, is a cautionary tale of over-reliance on international funding, overreach of foreign actors, and under-investment in the institutions of the state.

I suggest three questions to determine the appropriate role for government and private institutions in solving for large-scale economic and social challenges.

Is the good a public good, or is it rivalrous and excludable? Primary education, immunization, road safety, water, and sanitation have weak private markets because beneficiaries cannot easily pay or be excluded. Government is the natural payer and often the natural doer. When it comes to goods like handsets, solar lanterns, mobile payments, or a crop-insurance policy, each has a willing buyer at the right price. Markets are a powerful engine to create access and enable competition and distribution at scale.

Does the solution depend on a network, a platform, or competition between providers? If the answer is yes, the private sector almost always scales better and faster. Android did not need a state-owned operating system; what it needed was entrepreneurs competing to build cheaper handsets and better apps. The same applies to M-Pesa, micro-leasing, and last-mile logistics. Governments regulate platforms well; they rarely build them efficiently and effectively.

Where does state capacity actually exist, and where does it not? Starr and others press this point vigorously, and with good reason. But it cuts both ways. Where states are weak, fragmented, or hostile to their own people, designing exclusively for a government doer is not pragmatic; it is wishful thinking at best. In Afghanistan in 2002, no plausible reading of the state suggested it would build a national telecoms network in five years or that the government would lead girls’ education or enable women-owned enterprises. AKFED, as a leading private sector actor embedded in the country, believed it could build something transformational, economically and socially. It could and it did. Not-for-profit schools committed to girls education, alongside microfinance institutions supporting entrepreneurship, which created pathways for women to participate in the economy after decades of exclusion.

While we often think of NGOs as depending entirely on philanthropy, many are private, not-for-profit enterprises responding to market needs and generating revenues but not profits. Aravind Eye Care, Jaipur Foot, and the Bangladesh Rural Advancement Committee (BRAC) operate schools and clinics, for example, at massive scale serving segments of the population that neither markets nor the state reliably reach. They often provide essential services at a fraction of what governments spend due to specialized knowledge, technology, access to volunteers, and economies of scope and scale. Aravind performs more than half a million eye surgeries a year, mostly free or heavily subsidized, cross-financed by paying patients. No ministry built that. It was built with relentless emphasis on quality and inclusion, a deliberate design choice and a delivery-model innovation that deserves to be called out.

None of this is an argument against “the Big Shift” away from “Big Aid” and towards strengthening government capacity and efficiency in providing public goods. But before we decide government is the scaler of choice, we need to be clear about the problem we’re trying to solve. In many instances, government is the natural scaler. But where governments are weak, corrupt, or ineffective—or when the nature of the good is better provided by non-governmental, private institutions—we should not force-fit a solution. One size does not fit all: problems, actors, and context all matter.

It is important that we don’t replace one orthodoxy with another. We want to invest in robust governments that can and must do more with the resources they have and create space for private institutions to provide public goods and services when governments cannot or do not. Low-cost private schools in South Asia and Africa emerged to fill a vacuum where public schools were absent or where public education left students unable to read after five years of school. They were not designed to compete with quality public schools; they emerged to fill a void.

Private institutions can be exemplars. They can innovate and develop new business models cost-effectively that stimulate the public sector to do better. They can work as partners to public institutions and develop new ways to build teacher capacity and deploy new technologies to reach more students in less time. They can do this profitably and create new ways of educating girls or reaching rural patients using telehealth or mobile learning. Underserved people are not served by orthodoxies. They are served by whoever can deliver a good or service of value, affordably and durably, at the scale of the need. Sometimes that is a minister. Sometimes it is a business with a cell tower, and sometimes it’s an investor willing to build what a country has not or will not do on its own.

The 20-year-old debate around microfinance is in the spotlight yet again, sparked by a Wall Street Journal article that recycles familiar criticisms of the sector without considering the damaging implications of its oversimplification. For years, critics have raised concerns about customer over-indebtedness and have called into question microfinance’s real impact. But while it’s important to critically examine any intervention, sweeping claims of failure not only unfairly undermine the entire sector, but also miss a fundamental point: Access to capital remains an essential building block of economic mobility.

I recently returned from Malawi, where I spent time with women running small businesses, most of them renting stalls at their local market to sell produce, phone accessories, and clothing. When they described how they survived week to week, they didn’t talk about “capital.” They talked about having enough cash to restock perishable inventory after a slow week, pay a medical bill without shutting their stalls, or keep their children in school when income fell short.

These women, and many of the 3.4 billion people living on the margins, are entrepreneurs out of necessity. Running their own business is the only way for them to earn any income. Without access to responsible finance, a single setback forces impossible tradeoffs, including selling assets and turning to predatory moneylenders. With access, people can absorb shocks and plan ahead. For millions of people, inclusive financial services aren’t only about growing a business; they’re what make stability, and any path to mobility, possible. For them, the value of microfinance isn’t an academic debate, and the field simply cannot afford to reduce the conversation to headlines.

Challenges of the Microfinance Model

Part of the answer to why so many people consider microfinance a failure lies in how the sector evolved. As many are aware, Muhammed Yunus pioneered microfinance 50 years ago on the notion that all people have agency to shape their financial futures, and several founders, including FINCA’s, figured out how to sustainably provide capital to people who were excluded from traditional financial systems. The model rapidly gained traction, and there was immediate high demand for microloans.

However, to increase outreach, many providers in the sector prioritized scaling and generating returns over deep customer understanding. While this can be an effective strategy for providers operating in high-density markets or serving customers with existing business, it doesn’t work well for institutions aiming to provide solutions to people living on the margins.

For those focused on serving low-income customers, the issue is structural: Even the best models will struggle to deliver impact if the cost of capital is too high. At its best, microfinance blends philanthropic capital and impact investment to build institutions that responsibly serve marginalized customers. Providers borrow from development finance institutions, social impact lenders, and commercial funders to then on-lend to their customers. But it’s a knife’s edge exercise. A provider that doesn’t make enough money can’t attract and retain commercial funders. A provider that focuses too much on profit can’t generate the impact it set out to deliver in the first place. Subsidy and donor support are essential to meeting the needs of inherently harder to reach—and therefore more expensive to serve—customers.

Over the last 40 years, for example, FINCA has used more than $500 million in donated capital to distribute more than $16 billion in loans. Yet the cost of borrowing still exceeds 20 percent in many markets, as capital flows toward lower-risk opportunities. While concessional funding helps, the field needs broader solutions to deliver affordable capital at meaningful scale.

At the same time, resources are clearly shrinking. Global development assistance has fallen for two consecutive years, including a record 23 percent decline in 2025. The result is fewer safety nets and fewer opportunities for people living in or on the fringes of poverty. This shift is making it even harder for poverty-focused organizations to serve the hundreds of millions of people who already rely on microfinance for their daily survival, let alone to extend their reach.

As with any business, to operate, institutions must at least break even. To grow and improve, they must generate returns. Yet the work is inherently complex; providers must serve clients with volatile incomes, operate in fragile economies, and deliver both financial and social impact, while also safeguarding against over-indebtedness and abuse. The underlying issue isn’t just capital scarcity but the nature of capital and the incentives behind it.

Credit Is Essential to Economic Mobility

Most people living in poverty are self-employed, relying on subsistence farming or small, informal businesses. In Africa alone, nearly 83 percent of employment is estimated to come from informal work. And with growing youth unemployment on the continent, self-employment will only become more important to survival.

Small, well-structured loans—whether to build a business, plant crops, or even for consumption in an emergency—can help people break the cycle of poverty. Data from ATLAS, a financial inclusion data platform referenced in the Wall Street Journal article, confirms that, between 2023 and 2025, 66 percent of the global microfinance portfolio across multiple institutions and geographies went toward income-generating activities, including trade, services, and agriculture. During this same period, the median share of both women and rural borrowers was just over half (54 percent).

In addition, contrary to the critique that microloans are ballooning, inflation-adjusted data shows the opposite. According to ATLAS, while nominal loan sizes increased 64 percent over 5 years, inflation rose 116 percent, meaning real loan sizes have in fact declined. Many FINCA borrowers say their loans are too small, leaving them undercapitalized.

Randomized evaluations show that credit truly works when it’s designed well. More flexible, customer-centered approaches can perform substantially better than traditional one-size-fits-all solutions. Studies have found that giving borrowers greater flexibility in when and how they repay reduces financial stress and, in some cases, increases business investment and household income. Other evidence shows that pairing access to finance with skills training, savings, productive assets, and sustained support can generate more durable gains in livelihoods. These approaches guide FINCA’s work and, each year, FINCA surveys its customers to understand the challenges they face and measure the impact—positive and negative—of microlending services. Earlier this year, FINCA polled nearly 8,000 customers, of whom 73 percent reported that FINCA’s services improved their financial wellbeing, while only 3 percent said they were worse off.

The Real Debate: How to Align Capital and Purpose

Microfinance isn’t a silver bullet, but dismissing it won’t help solve global poverty. Instead, the field needs to adopt better ways of working to align capital and purpose. This means inclusive finance providers need longer-term investments, more flexible financing structures, and greater access to funding at the country level.

Social investors like Acumen and Oikocredit have shown that mission-driven organizations benefit more from funding with longer timelines and higher risk tolerance than they do from funding from lenders who demand quick repayment. Opportunity International has successfully combined donor funding with private investment, demonstrating how philanthropic funding can make it less risky and more attractive for commercial funders to enter markets or sectors they wouldn’t normally serve. And Aceli Africa provides incentives to local lenders to serve agribusinesses, helping banks look beyond the traditional risk perceptions and lack of collateral that often leave agricultural enterprises wanting.

Reaching the most vulnerable populations will always require some level of subsidy, because it costs more to meet the needs of non-traditional borrowers. Philanthropic capital is what allows organizations like FINCA to serve high-risk populations. It enables providers to test new approaches that can permanently change perceptions and to focus on impact.

At the same time, financial institutions need to evolve their business models, design better products, and deliver lower costs to customers. Data analysis and technologies like artificial intelligence—which may help organizations listen to customers at scale, analyze what people need, and adapt solutions in near real time—can help. For example, FINCA recently launched a product innovation lab that uses human-centered design to rapidly design, test, and scale new solutions that address the underlying causes of poverty. Additionally, FINCA is partnering with institutions like Amazon Web Services, Thought Machine, and Ikigai to develop a new technology platform that brings affordable, banking-grade technology to microfinance institutions so that providers can finally tailor loan terms to meet individuals’ unique cash flows, speed up the disbursement process, and increase efficiency to lower costs.

These and other approaches are already supporting economic mobility among people living in poverty, and they have the potential to create even greater impact. Rather than choosing between blind optimism and wholesale dismissal, microfinance providers and funders must recognize the value of responsible financial services, while continuing to refine and improve the model so that it genuinely serves the people who need it.

Consider a number: In 2025, the average American nonprofit retained slightly more than 43 percent of its donors from the previous year.

This figure has hovered near or below 45 percent for more than a decade and has resisted every tactical fix the sector has deployed. That persistence is, itself, diagnostic: When a problem resists tactical solutions across an entire industry, for more than a decade, it is not a tactical problem. It is a philosophical one.

The problem is that the sector keeps asking how we retain more donors, when the more useful question is: What kind of relationship are we trying to build? The former is business as usual; the latter requires actual transformational philanthropy. After all, organizations that genuinely understand transformational philanthropy do not experience the same attrition crisis, because they have not merely acquired donors. They have cultivated partners.

What follows is therefore not a tactics guide. It is an argument, grounded in fundraising science, developmental psychology, behavioral economics, and organizational culture, about what transformational philanthropy requires, and why so few organizations achieve it. The principles are neither new nor complicated. They are simply, persistently, under-implemented.

Putting Identity at the Center

Behavioral science has established that the most reliable predictor of transformational giving is not wealth, not affinity metrics, but identity. For one thing, brain-imaging research shows that when donors contemplate a charitable bequest, the neural reward pathways activated are the same ones associated with personal financial security and transcendence. At sufficient depth, giving and being merge: The donor is not merely supporting a cause; they are becoming something new through that act of support.

Moreover, donors who hold a strong philanthropic self-concept—which is to say, they experience generosity as core to who they are, not something they do periodically—give significantly more, give more consistently, and are far more likely to make stretch gifts, multi-year commitments, or estate provisions. They are, in short, the kind of givers whose philanthropy creates true, deep, and lasting change.

Findings like these overturn one of fundraising’s most durable assumptions, which is that gift size is primarily a function of wealth. It is not. It is determined largely by the depth of a donor’s philanthropic identity, and by whether the organizations they support help them see giving as an act of self-expression. When organizations ask donors to “invest in our mission,” they are making identity invitations, whether they know it or not. The question every fundraiser must therefore answer honestly is: Are we inviting genuine self-expression, or a transaction dressed up as one?

Donors know the difference, and the attrition data proves they act on it. Donors do not give to organizations: They give to expressions of their own values—through organizations.

In his research on major donors, Paul Schervish uses the concept of moral biography: the accumulated experiences, losses, and convictions that shape a donor’s deepest motivations. His interviews with high-net-worth donors reveal that the largest gifts are almost never primarily about tax efficiency. They are about completion, about acting on convictions held for decades, honoring a loss, or building something that will outlast the donor. The Indiana University Lilly Family School of Philanthropy’s Generosity for Life research confirms this at scale: donors with a clearly articulated personal philanthropic philosophy give, on average, 4.2 times more than demographically similar donors who lack one.

For this reason, helping donors clarify their own values is itself a transformational act. The most important conversation a major gifts officer can have is not about naming opportunities. It is about what the donor believes, what they have lost, and what they hope to leave behind. The Coutts Million Dollar Donors Report consistently finds that ultra-high-net-worth donors describe their largest gifts in existential rather than financial terms: the gift gave their life meaning, connected them to legacy, or let them act on a long-held conviction

Building Organizational Meaning

No transformational gift is made to an organization a donor does not trust. Why, then, is the sector’s investment in trust-building so chronically underweighted relative to its investment in prospect research and digital acquisition? Nonprofits pour growing budgets into finding and acquiring donors because that spend is easy to measure and defend, but trust-building pays off on a multi-year timeline that no board report can capture. The proof is in the mismatch: acquisition and screening spend keeps climbing while retention sits near 32 percent and only 14 percent of first-time donors ever give a second gift.

However, trust cannot be engineered through communications strategy. It must be earned through organizational character. But this raises an uncomfortable question for nonprofit leaders: Is our organization trustworthy? Not merely transparent by legal standards, but genuinely coherent? Does leadership model the values it asks donors to support? Even more importantly, transformational giving requires meaning: Impact data matters, but alone it does not move a donor to transformational engagement. It must be paired with narrative resonance, the experience of recognizing oneself in the story the organization tells.

For this reason, donors need both the head (evidence of impact, credibility, stewardship) and the heart (connection to purpose, belonging). Organizations that speak to only one register will reliably underperform those that speak to both.

The sector spends five to ten times more to acquire a donor than to retain one—and then wonders why transformation is so rare. But transformational philanthropy cannot be compressed into a campaign cycle. Donors who give consistently for five or more years are exponentially more likely to make a major or planned gift, and each retained year compounds a donor’s lifetime value in ways no acquisition investment can match. Donor retention is therefore the temporal precondition for transformation, the real goal: A donor churned after eighteen months of transactional engagement will never become a transformational partner. And the organization that loses that donor may have foreclosed the largest gift in its history. The sector spends five to ten times more per dollar to acquire a new donor than to retain an existing one: an industry claiming to value long-term impact while undermining the relational conditions that produce it.

In transformational fundraising, the ask is not a campaign event, but the culmination of a relationship already moving the donor toward readiness. Capacity to give and readiness to give are not the same thing; conflating them accounts for many solicitations that damage rather than deepen relationships. Premature solicitations damage relationships and reduce lifetime value. Gift readiness not as a function of wealth screening but of relational maturity, based on the stages of engagement, conviction, and trust a donor has moved through.

Making Culture Is the Precondition

Perhaps the most underappreciated finding in philanthropic research is that transformational fundraising cannot be practiced by a development staff alone. The entire organizational culture—from board leadership to program delivery to how a receptionist answers the phone—shapes whether a major donor deepens their commitment or quietly withdraws.

As Board Source’s 2023 Leading with Intent research documents, prospective major donors regularly conduct informal due diligence on board governance and CEO character before committing to transformational gifts. A development program housed in an organization with a dysfunctional board or a culture of internal mistrust cannot produce transformational philanthropy at scale, regardless of how skilled its frontline fundraisers are. And Penelope Burk’s longitudinal donor survey research, replicated across thousands of respondents over two decades, persistently identifies the same three factors when donors explain both their largest gifts and their most significant departures: organizational trustworthiness, leadership transparency, and the quality of stewardship following a previous gift.

Sargeant and Woodliffe’s research establishes that stewardship quality is the single strongest predictor of donor upgrade and long-term retention, more powerful than mission affinity, recognition programming, or even a donor’s relationship with a specific staff member.¹⁶ The moment of greatest return is not the solicitation. It is everything that happens between gifts.

The word stewardship derives from a tradition of sacred care—the faithful tending of something entrusted by another—but when fundraising practice reduces it to acknowledgment letters and annual reports, it abandons its own most generative possibility. Transformational stewardship communicates something more essential: you are known here; your gift changed something real; you belong to this story.

It is covenantal rather than contractual.

From First Gift to Final Gift

The fullest expression of transformational philanthropy is the planned gift—extending one’s values beyond one’s own life. Planned giving conversations are categorically different from major gift solicitations because they are invitations into life review, not financial transactions.

Giving USA 2026 estimates charitable bequests in the United States reached $54.9 billion in 2025, roughly 10 percent of all US charitable giving. Perhaps the most important finding from bequest research, though, is that the size of a donor's annual gift does not reliably predict planned giving propensity. Bequest donors routinely make modest annual gifts, sometimes under $1,000, yet leave six- or seven-figure estate commitments. The predictors are relational: depth of engagement, shared values, institutional trust, and belonging to something worth perpetuating.

This convergence of research—donor identity, moral biography, trust, stewardship, community belonging, and planned giving motivation—points toward a synthetic understanding of donor engagement. A donor fully engaged across mission alignment, values resonance, personal connection, visionary alignment, community identity, and emotional investment is not merely satisfied. They are transformed: they experience the organization as an extension of who they are. Their giving is not a charitable act. It is an act of self-authorship.

For this reason, emotional engagement and personal agency outperform financial incentives as drivers of giving escalation. The most sophisticated fundraising tools available are not data analytics. They are listening, curiosity, and disciplined cultivation of genuine human connection. Social identity research adds another dimension: donors respond powerfully to knowing that peers who share their identity are giving at a certain level, increasing average gift amounts by as much as 29 percent. Organizations that build genuine communities of belonging do not simply “improve retention.” They create the social conditions in which transformational generosity becomes culturally normative.

The Imperative

The sector faces a choice, and it is not primarily a strategic one. It is philosophical.

One path leads deeper into the logic of acquisition: more data, more segmentation, more optimization of the transaction. This path produces a predictable result—the 43 percent retention rate, the acquisition cost premium, and an industry that perpetually replaces donors it cannot retain while wondering why the largest gifts go elsewhere.

The other path demands something harder: a fundamental reconsideration of what a donor relationship is for. It requires organizations to ask whether their culture deserves the trust of a transformational donor, whether their stewardship communicates belonging or mere compliance, whether their fundraisers understand moral biography as well as they understand wealth screening.

The research is unambiguous about which path produces transformation. Donors who experience deep relational engagement, genuine values resonance, and authentic community belonging give more, give longer, and ultimately give in ways that change institutions—and themselves. The fundraiser who understands this does not ask How do I close this gift? They ask How do I help this person become who they most want to be?

That question is not a technique. It is a vocation. And the sector that takes it seriously will discover that transformational philanthropy is available to any organization willing to do the harder, slower, more profoundly human work of building a relationship worthy of trust.

When I was a child, like many children, the street was where I learned how to live in the world. Playing was not just playing. We gathered every evening, first to decide what to play, then making our way through intense debates about how: the rules to follow, the boundary conditions to honor, the alliances that would dictate team formation, and heated discussions over strategies to win. In that one hour, we practiced negotiating, disagreeing, and finding a middle ground. We learned how power shifted, all while retaining our sense of play and wonder. In this shifting social drama, everyone was simultaneously an actor, an audience, a rule-maker, and a student.

When was the last time you saw children playing on the streets? When was the last time this was how you learned?

Today, for children and adults alike, learning can often begin somewhere very different: in search bars, recommendation feeds, and AI-generated summaries. But while conversations about artificial intelligence increasingly revolve around productivity and efficiency, what is lost when the environments that once cultivated social and embodied learning get replaced by systems optimized for speed, convenience, and certainty? Who do we become when our theaters of social learning are outsourced, and when imagination is supplied on demand instead of cultivated through practice? How do these new technological changes reshape the conditions through which people learn, connect, and participate in the world? How do they make meaning of the various social developments happening around them? Are there capacities and skills that must stay stubbornly human even when AI can automate them and do them more efficiently?

Finally: What might this mean for a social sector whose work depends upon precisely these capacities?

For much of human history, what can be called the “developmental commons” were the streets, forests, playgrounds, libraries, and classrooms, shared social spaces where attention was exercised, imagination was stretched, relationships were formed, and, most importantly, knowledge was situated within lived experience. Today, as digital platforms are becoming some of the primary environments in which young people (and many others) learn to relate to themselves and others, we need to explore how the environments in which we spend our time shape the capacities we develop. A growing body of research shows that cognition does not occur solely within the brain, but emerges through interactions with bodies, physical environments, movement, objects, and other people. More than just receiving information, learning is also about the conditions in which knowledge is encountered and made meaningful.

So: What kind of world of learning are we creating?

1. A frictionless world has a cost.

In conservation and environment-related work, restoring the connection between humans and nature is central to a people- and planet-friendly society. Much depends on encountering the living world directly, exploring the wild, and holding its many contradictions and uncertainties. Sometimes this means rigorous scientific observations; other times, using anecdotal insights to bridge the gap between knowledge and practice. In both cases, it means experiencing friction as a feature through real-world engagement.

Can technology deepen connection with nature without becoming a substitute for it, or do we lose our sense of play and wonder when learning becomes frictionless?

Nature is part of the cognitive environment through which learning happens, not outside of it. And this insight has important implications for how we think about technology in the social sector. A community practitioner reviewing an AI-generated summary may gain access to information, but a practitioner spending time in a village, listening to stories and observing relationships, develops contextual judgement and holds local nuance that grounds that information. In many cases, the process through which knowledge is acquired is inseparable from the quality of the knowledge itself.

The challenge, therefore, is how technology can be designed and deployed in ways that strengthen, rather than displace, embodied forms of learning and engagement. Even when technology can create efficiencies and quick wins, sometimes choosing not to use it can help retain productive friction and be the more helpful choice.

For example, the Nature Conservation Foundation programs connecting people to birds have expanded from field-based learning and printed resources to include online courses, digital platforms, and tools that make bird identification more accessible to the public. These efforts have broadened participation significantly, but NCF remains guided by a simple principle: The value of technology lies in its ability to draw people back into a relationship with the natural world. There are innovations that have been able to do this successfully: Tools like Merlin, an AI-powered bird identification app developed by the Cornell Lab of Ornithology, demonstrate a different possibility for technology. But the key is that rather than replacing the experience of being outdoors, Merlin helps people identify birds they see or hear in real time, turning a moment of curiosity into a deeper encounter with the natural world.

2. AI slop is an attention problem before it is an information problem.

We are entering an era where information can be generated faster than it can be verified or meaningfully interpreted. This information abundance obviously magnifies challenges around misinformation, but also around how our attention can be used as a currency. And while the distortion of facts is an important challenge, we also need to look at which facts are being made visible to begin with.

Cognitive neuroscientist Maryanne Wolf argues that the shift toward digitally mediated reading environments may be reshaping cognitive processes associated with what she calls "deep reading," typically associated with the capacity for reflection, for cultivating empathy and critical analysis, and for encouraging inference and imaginative engagement. As information arrives in rapid, broken streams, attention itself becomes fragmented. The consequence is a diminished capacity to stay with complexity long enough for understanding to emerge.

We see the consequences of this shift emerging in different forms. Organizations working on gender equity are dealing with the growing influence of the manosphere, a loose ecosystem of influencers and online communities that rigidly frame masculinity and often promote hostile ideas about it. Generative AI and recommendation systems can accelerate the spread of such narratives, creating feedback loops in which misinformation and polarization travel faster than nuance and dialogue.

A different but equally significant concern is invisibility. Large language models learn from what is documented, digitized, and visible online, focusing on places that receive extensive media coverage, have well-documented institutional histories, and digital footprints. Information on smaller cities, local citizen movements, oral histories, and everyday governance realities often remain underrepresented. This representation inequality makes entire places, communities, and forms of knowledge invisible and absent from the systems through which people learn and make sense of the world.

This is particularly relevant for the social sector. What happens to public trust when attention, not accuracy or representation, becomes the primary currency of the digital age?

3. Social change depends on situational intelligence.

We also need to talk about recovering judgment: Once information is visible, the harder task is deciding what it means, where it belongs, and how it should shape action.

AI's power is its ability to identify patterns across enormous volumes of information. But social change sometimes requires the opposite move. For example, a conservation practitioner deciding how to restore a watershed must understand the particular history of that landscape, the relationships between communities, the local political economy, and forms of ecological knowledge that may never appear in a dataset. Beyond commonalities, it is equally important to stay with the differences.

To this end, Tech4good Community anchors a conservation coalition program that is working with several NGOs to build shared infrastructure for ecological intelligence. They highlight that while interest in AI, analytics, and digital tools is growing rapidly across the social sector, the work they have done with many grassroots conservation organizations demonstrates that organizations today are not just demanding better technology but using that technology in a place-based and locally intelligent manner.

Generalized intelligence needs to be made useful through situational and grounded judgement, with the ability to interpret signals within specific social, ecological, and cultural realities, and to understand when a recommendation should be adapted or ignored. Most importantly, it is important to recognize what is absent from the data as much as what is present.

Learning Capacity to Be Human

This is the paradox of the moment: As intelligence becomes increasingly available on demand, the capacities that may matter are deeply human, not computational. In that sense, the vanishing developmental commons is a story about the environment and experiences we choose to lean into as a society. AI will become more capable. But can we remain intentional about preserving conditions through which people learn to pay attention, make sense of complexity, remain open to wonder, and build coherence between different ways of knowing?

For philanthropy, this may require thinking beyond technology adoption and toward capacity preservation. Supporting institutions, spaces, and practices that cultivate civic trust and value the process as much as the outcome. Perhaps choosing to preserve this inner theater could be one of the most important acts of stewardship we could undertake at this time.