Hi everyone. Quick reminder: The second part of the Philanthropic Reforms town halls is today, 10/5, at 11am PT, where several prominent sector leaders will be exploring policies and strategies on foundations and Donor-Advised Funds to prevent wealth hoarding and tax evasion. This is the follow-up from the first town hall, which I moderated. Here’s the recording.
Durfee Foundation President Carrie Avery and I were discussing over email the power dynamics between funders and nonprofits. While there is much to talk about, Carrie brought up a really good point that I had not considered before—the term “Foundation Program Officer” is weird:
“Why an officer? An officer makes me think of a police officer, a probation officer, someone in a position of power whose judgment can have a devastating and decisive effect. If foundations want to work with their ‘nonprofit partners’ then why is the person on the foundation side of that relationship called an officer? Language matters. Let’s start a movement to rename this role!”
I agree, and while we’re thinking about new titles, let’s completely reimagine what the role entails. It should be less micromanagey—like a boss who constantly watches over you to make sure you don’t steal office supplies—and more expansive, like a favorite colleague that you can commiserate with and occasionally play pranks on.
Today’s topic, however, is about Funding-Chicken. Funding-Chicken, which is not nearly as fun as it sounds, is when a foundation refuses to be the first to fund a project or organization. Instead it waits for another funder to formally commit, and then might join in. It’s also known as “Fear of being First Syndrome,” aka FFS.
Truly this is one of the most annoying and baffling of funder behaviors. When we get back to “normal” and I can work on my sketch comedy show, there will be a nature-documentary skit called “Funders in the Wild.” Imagine the soothing voice of Sir David Attenborough narrating:
“Funders, though they have no natural predators, have nonetheless developed an evolutionary instinct based in fear. Here we see three funding organisations, frozen in equal measure at the thought of being the first to commit financial support for a project. Let us observe this fascinating ritual as the group uses various herd-based mentality and communications tactics to avoid taking initiative.”
This is, unfortunately, all too common. I’ve experienced it several times, the latest being trying to find funding to launch the Community-Centric Fundraising movement. (And before that, when I sought foundation sponsors for my one-man show, “Point of Vu: An Exploration of Organizational Capacity Building in Twelve Acts.”) I am not saying all funders engage in Funding-Chicken, but enough do, so we need to examine how harmful and inequitable this practice is:
It stifles innovation: Nonprofits are told all the time that we need to be “innovative.” Often this manifests in many funders refusing to support anything but the newest, shiniest programs, often at the neglect of ones that have been proven to work. The irony comes when, after constantly extolling nonprofits to be innovative (and punishing them for not), foundations refuse to be the first to fund a new project. If you want nonprofits to be innovative, then you need to take risks.
It furthers the “Track Record Paradox:” On the other hand, many funders won’t fund stuff until there’s track record of success. But how the hell are leaders, orgs, and movements supposed to get a track record if there’s no funding in the first place? This paradox stacks on top of other ones, including the Capacity Paradox, where funders won’t fund an organization unless it has strong capacity, but it can’t build strong capacity unless it has resources; and the Data-Resource Paradox, where an organization can’t get funding unless it has strong data, but it can’t get strong data unless it has funding.
It wastes time that we don’t have: So much nonprofit time is wasted waiting on a foundation to be the first to commit so that we can “leverage” their support for other grants. It’s like a really bad romantic comedy where two characters will wait on the other one to make the first move, then two years pass, and everyone around them is exasperated. Unlike “Love Actually,” though, as we wait for funders to be the first to pitch in a few bucks, real people are dying, forests are burning, and our democracy is crumbling.
It causes burnout: It is really exhausting doing the community needs assessment, researching effective models, designing a program, developing a fundraising plan, approaching funders to be told they need to see who else is committed before committing themselves, and then having to play annoying psychological games to get someone to make the first move: “We heard from the XYZ Foundation, and they said they might be interested in matching ABC Foundation, but ABC will only hop on board if your foundation commits.” As I have mentioned many times, so much of our burnout in this sector is not necessarily due running our programs, it is because of having to deal with aggravation like this again and again.
It disproportionately affects BIPOC-led orgs: All of these negative effects are not equally distributed. Like with everything else, they are more harmful organizations and movements led by and serving BIPOC communities, disabled people, LGBTQIA, and other marginalized folks who do not have the same access to time and money to sustain themselves while funders figure things out. When you play the game of Funding-Chicken, just remember that the people you hurt most will be the folks who are already the most affected by systemic injustice.
A while ago, I was complaining about Funding Chicken, aka FFS, to a funder colleague when she said something that has stuck with me: “Foundations often move in packs. Like wolves. Or lemmings. We will not do anything until we see other foundations doing it first.” Well, this is ridiculous. No one has time or energy for this. The sector has put up with it long enough. You are stymying progress and harming communities with your indecisiveness and risk-aversion. If you care about communities, do not play Funding-Chicken. Here are some things funders can do, with thanks to Carrie and the Durfee Foundation for contributions to these thoughts:
Analyze to see if/when you are doing this. Look at your grant processes. Do you require organizations to have a track record? Do you have an unspoken rule about not funding a leader, organization, or movement unless it has a “seal of approval” from another funder whose opinion you trust? Look through your past and current grantees. Were you among the First Funders for these orgs, or were you more a Bandwagon Funder?
Intentionally be the first to support projects: You can do this by having grant programs such as Durfee’s Springboard Fund. And/or ensure that all your grantmaking is deliberate about jumping on board even when organizations do not have other supporters committed. Take it as a point of pride to the first to back something, as this takes way more guts than to wait until it’s more “safe” to do so. (Although don’t turn this into a thing where you don’t support something unless you’re among the first funders, either.)
Assess what risks you’re trying to avoid: Figure out why you play Funding-Chicken. Is it because you’re afraid other foundations won’t join in, and your foundation will look like a fool, like someone who got pranked into wearing a costume to a non-costume party? Is it because you fear that if you invest in an “unproven” or “unvetted” organization, there might be financial malfeasance? Reflect on whether these are valid reasons to delay supporting important projects, especially ones proposed by communities most affected by injustice.
Reexamine and redefine what success looks like: As Carrie says, “we don’t define success simply as ‘scaling up.’ Not all community groups are meant to become multi-million dollar nonprofits. Certainly we’ve had Springboard groups that haven’t reached as many people as we would have hoped, or embarked on a strategy that we didn’t love. But good things still happened for the community, so we believe our grant dollars were well spent.” Embrace failure and learning as part of success.
The era of funders playing Funding-Chicken needs to end. If you think an organization, leader, or movement is important, then fund it, regardless of who else is on board. Accept failure as part of doing this work. And understand that your decisions disproportionately affect marginalized communities.
Let me know your thoughts in the comment section. Now, if you will excuse me, I have to go practice my Sir David Attenborough impersonation.