Is it just as hard to give out money as it is to seek it?

[Image description: A squirrel with fluffy ears, peeking out from behind the trunk of an ivy-covered tree, looking inquisitive. Image by mariuszopole on Pixabay]

Hi everyone, if you’re interested in being involved with the Crappy Funding Practices movement, please join a special meeting we’re hosting on May 14th at 10am Pacific Time, where we’ll update you on what’s been going on, and present the different options for you to plug into. Register here. See you then!

A few years ago, I was in Oxford, speaking on a panel at a conference with colleague Jessamyn Shams-Lau, who is the lead author of Unicorns Unite: How Nonprofits and Foundations Can Build Epic Partnerships; we were there to promote the book and discuss how nonprofit leaders and funders could work more effectively together. during the Q&A, a program officer pushed back, hinting that we panelists were unfairly critical of funders, and declaring that giving out funds is just as difficult seeking it. Several funders in room, and a few nonprofit leaders, nodded in agreement.

At another time, in Seattle, a funder said to me “Vu, one day you’ll work for a foundation; I predict you’ll see how challenging it is to make grants. It’s just as difficult as applying for them.” Work for a foundation? I am tempted by the prospect of access to unlimited pistachios, La Croix, and dry-erase markers—trust me, I’ve been to some of y’all’s offices—though at this point, I am not sure any foundation in its right mind would hire me.

If we repeat things often enough, we start to believe them to be true, even when they are not. For example, we say things like “80% of philanthropic dollars come from individual donors” (False!) or “general operating dollars means no accountability” (Ridiculous!) or “you can’t thank someone too much!” (You absolutely can!) or “unlike his online persona, Vu is really awkward in-person; do not invite him to your house parties, he will stand in the corner and rant at your guests about Donor-Advised Funds” (True, but hurtful!)

Over the years, it seems the sentiment “Giving out money is just as difficult as applying for grants” has been proliferated and the sentiment internalized among many funders and even nonprofit leaders, and like many of the philosophies we take for granted, has been very annoying and displays a lack of awareness of privilege and power dynamics and negatively harms the work.

Before my foundation colleagues pelt me with pistachio shells, I am not saying that grantmaking is a piece of cake. I see how hard some of you work. Foundation staff also face burnout, especially those who are trying to do their work thoughtfully and with an equity lens in mind. And there are challenges you’re dealing with that many nonprofit leaders may not encounter with the same frequency, such as appealing to the egos of family members who sit on the board of trustees and who may have the content knowledge and temperament of toddlers.

However, it is disingenuous to say that giving out money is just as hard as seeking it. Unless you’re at a foundation that must annually raise money to give out, funders probably don’t wake up in cold sweat, worrying about whether the next payroll can be run. You probably don’t have as many panic attacks regarding having to lay off one or more of your team members if fundraising goals are not being met. You’re probably not constantly in survival mode because you have few guarantees on which, if any, of your sources of revenues will renew next year. You’re probably not duct-taping your chairs and using computers that are still running on Windows 95. You’re probably not forced to bite your tongue as frequently for fear of having funding rescinded that would jeopardize entire programs and staff teams. At least, not as much as nonprofits.

It is these fear, instability, uncertainty, and power imbalance that make working at a nonprofit difficult. Funders, especially the ones with endowments, don’t have to deal with these things with the same degree of frequency or intensity. Plus, foundation staff are on average better compensated, including having better benefits such as paid-time-off and retirement contributions.

So yeah, to say that giving out money is just as hard as seeking it shows a lack of analysis about the dynamics of our sector, and a kind of naïve cluelessness that makes a lot of nonprofit leaders roll our eyes, and possibly steal a few dry-erase markers whenever you invite them to visit your foundation office.

Besides being annoying and insulting, this philosophy may explain some of the terrible funding practices we keep experiencing. If funders truly believe their work should be as difficult as nonprofit work, they’re likely to gravitate toward creating and maintaining all the bureaucracy, tedium, and malarkey out there, in order to legitimize the sentiment. For every onerous, pointless grant application that a nonprofit professional must fill out, someone or several people from the funding side must spend a great deal of energy reviewing. For every obnoxious, unnecessary report nonprofits have to write, several people have to read and think about it or file it away or whatever.

This may also help to explain why Multi-Year General Operating Dollars (MYGOD) still continue to be so slow to be adopted by so many funders despite endless data showing how effective it is. MYGOD makes funders’ work much easier. Fewer onerous applications to review. Fewer budget line items to dissect. Fewer meaningless reports to peruse. How then could funders justify the sentiment that their work is just as hard as nonprofits’, and also, let’s be honest, justify the higher salaries?

So I don’t buy this idea that giving out money is just as hard as seeking it. Unlike many of the challenges that nonprofit experience, most of the ones funders deal with are self-created. Funders don’t HAVE to come up with ridiculous, time-wasting grant processes when they could just accept a grant proposal that’s already been written. Funders don’t HAVE to come up with energy-sapping reporting requirements, when they can just accept annual reports. No one is forcing funders to spend endless months coming up with strategies or to conduct a community needs assessment or whatever, when they can just review existing research and follow in the leads of communities regarding strategies and priorities. No one is forcing funders to perpetuate the cutthroat hunger games, when they can focus on ensuring resources go to the communities most affected by injustice.

I’m sure there are unique challenges funders face, but I bet those are also caused by funders, who have the resources and power to resolve those challenges individually and collectively if they really want to.

And they need to be resolved, since it’s dragging the whole field down. And it’s forcing us to launch movements like Crappy Funding Practices. Even funding colleagues are getting tired of all the shenanigans. According to preliminary results of the First Draft Funders Survey, “92% of funder staff are unsatisfied with the ways funding is being done today. Funder staff believe their top 2 goals to be moving power to communities (74%) and moving money to communities (72%). In reality, their goals end up being performing diligence on nonprofits (73%) and serving as a liaison between those with resources and those that need resources (64%).” (Join the webinar on June 4th at 11am Pacific time to learn more).

Anyway, if you believe this idea that giving away money is just as challenging as seeking it, take a moment to reflect on it. Is it true? What are the challenges, why do they exist, and who has the power to do something about them? More importantly, think about what we can achieve together as a sector if both funders and nonprofits didn’t have to waste so much time and energy on these challenges, many of which are created by funders when they really don’t need to.