I do not know this article but here are my thoughts on this problem, having worked at a private foundation myself.
The amount of money awarded per staff lies on a scale. On one end a foundation could just make 1 massive grant a year to one organization. On the other end, make millions of super small grants. As organizations navigate this scale from one extreme to the other, in my experience these are some of their considerations:
Diversifying the portfolio of grants—if one does not succeed, there are still many to possibly have high impact
Limited expertise of staff
Limited responsibility of staff—it seems that more staff are a better system of checks and balances where corruption or poor judgement are discovered easily
Field saturation—in my foundation, there were certain areas that we have kind of already funded to what we believed was their maximum potential. If we suddenly had twice the money, we would not have given it to the same area. We would need to research and justify a new cause area.
Ultimately, I think that there is a sense of “wanting to know something the others do not know” or being original in some way. One could have a foundation that simply funds high quality proposals that were not funded simply due to lack of resources by other funders. Super efficient, just needs a small grants and operations team. Yet, it lacks mission and is generally unappealing to the board and founders.