<< Needing more than one funder provides a healthy sanity check on if the project is really the best use of funds>> Also to this point… doesn’t it heavily depend on the funder? If the funder isn’t impact driven I’m not sure it’s a great sign they want to fund you?
A funder who isn’t impact driven could be the best funder of all! The “cost” of funding—in terms of good that wasn’t done because the funder didn’t donate to the next organization on their list—may be low, zero, or in rare cases even negative.
I think people model this in theory more often than it happens in practice. Three reasons why:
The total funding pie is pretty fixed; I expect it to be quite rare to grow it.
It could be that the next org on the list is much worse, but normally, if they are funding something effective, there is a non-random reason they came to the top of the list. I think it’s more common that a funder has different values—e.g., they are supporting global health and mental health, and you have a strong view that the one you are working on is significantly better (of course, someone working on the other would say the opposite). But I think that seems a bit immodest/morally presumptuous to then treat this counterfactual as massively different based on a pretty debatable value call.
You could, in fact, recommend your funding to go somewhere else with high EV (thus making the counterfactual higher). E.g., if someone says, “I like AIM, I want to give it $1m,” and I say, “Sorry, we have no room for funding, but have you considered X charity? It is also really good and hits similar ground.” This is not possible in every fundraising situation, but it is doable, and if I know an opportunity that I think is $-for-$ better than AIM, I have been pretty successful at redirecting funding that would go to AIM there.
Oh interesting. I want to dig into this more now, but my impression is that an individual’s giving portfolio—both major donors & retail donors, but more so people who aren’t serious philanthropists and/or haven’t reflected a lot on their giving—is that they are malleable and not as zero-sum.
i think with donors likely to give to ea causes, a lot of them haven’t really been stewarded & cultivated and there probably is a lot of room for them to increase their giving.
Well i think that’s the point of the post to debate this! And i think there are relevant trade offs in regards to maintaining the impact of the organisations which are seeking to diversify funds that aren’t usually considered so maybe “far more counterfactually” seems too strong.
I think there’s an important nuance here regarding what truly constitutes a ‘healthy sanity check’ when it comes to funding. Simply having a non-EA funder interested in your project doesn’t necessarily validate its impact. For instance, if a funder’s motivation is based on personal affinity, like finding the team charming or being impressed by the organization for non-impact reasons, this might not confirm that the project is the best use of resources.
To me, a real sanity check comes from the support of funders who prioritize impact and apply a high bar to their investments. If a highly discerning funder with a strong emphasis on impact independently chooses to support the project, regardless of whether you accept their funding or not, that’s a stronger endorsement than diversification for its own sake.
Yes I would probably agree with all that. I think the endorsement is stronger from an EA donor and that’s great, but the end value of the money itself seems more likely to be far stronger from a non aligned donor.
A funder who isn’t impact driven could be the best funder of all! The “cost” of funding—in terms of good that wasn’t done because the funder didn’t donate to the next organization on their list—may be low, zero, or in rare cases even negative.
I think people model this in theory more often than it happens in practice. Three reasons why:
The total funding pie is pretty fixed; I expect it to be quite rare to grow it.
It could be that the next org on the list is much worse, but normally, if they are funding something effective, there is a non-random reason they came to the top of the list. I think it’s more common that a funder has different values—e.g., they are supporting global health and mental health, and you have a strong view that the one you are working on is significantly better (of course, someone working on the other would say the opposite). But I think that seems a bit immodest/morally presumptuous to then treat this counterfactual as massively different based on a pretty debatable value call.
You could, in fact, recommend your funding to go somewhere else with high EV (thus making the counterfactual higher). E.g., if someone says, “I like AIM, I want to give it $1m,” and I say, “Sorry, we have no room for funding, but have you considered X charity? It is also really good and hits similar ground.” This is not possible in every fundraising situation, but it is doable, and if I know an opportunity that I think is $-for-$ better than AIM, I have been pretty successful at redirecting funding that would go to AIM there.
Could you say more on how you came to this conclusion?
Mostly basing this on the macro data I have seen that seems to suggest giving as a % of GDP has stayed pretty flat year to year (~2%).
Oh interesting. I want to dig into this more now, but my impression is that an individual’s giving portfolio—both major donors & retail donors, but more so people who aren’t serious philanthropists and/or haven’t reflected a lot on their giving—is that they are malleable and not as zero-sum.
i think with donors likely to give to ea causes, a lot of them haven’t really been stewarded & cultivated and there probably is a lot of room for them to increase their giving.
A hundred percent true. Less “impact driven” funders money is likely far more counterfactually valuable than that of an impact driven funder.
Well i think that’s the point of the post to debate this! And i think there are relevant trade offs in regards to maintaining the impact of the organisations which are seeking to diversify funds that aren’t usually considered so maybe “far more counterfactually” seems too strong.
I think there’s an important nuance here regarding what truly constitutes a ‘healthy sanity check’ when it comes to funding. Simply having a non-EA funder interested in your project doesn’t necessarily validate its impact. For instance, if a funder’s motivation is based on personal affinity, like finding the team charming or being impressed by the organization for non-impact reasons, this might not confirm that the project is the best use of resources.
To me, a real sanity check comes from the support of funders who prioritize impact and apply a high bar to their investments. If a highly discerning funder with a strong emphasis on impact independently chooses to support the project, regardless of whether you accept their funding or not, that’s a stronger endorsement than diversification for its own sake.
Yes I would probably agree with all that. I think the endorsement is stronger from an EA donor and that’s great, but the end value of the money itself seems more likely to be far stronger from a non aligned donor.