Personally, I do not think we have swung too far on this. Even in the AIM/āCE cohorts (from which both of the recent public shutdown posts came), I still think people err too much on the side of keeping projects running when they are not performing.
I think how to think about shutting down projects comes down a lot to counterfactuals. Itās not that a project could not work or definitely will fail; itās about how good a marginal bet it is. Every dollar and high-talent hour going into the project could, in theory, be going somewhere elseāoften somewhere with pretty high impact. When I think about a cohort of 6 charities founded out of AIM, after 2 years, I would expect shutting down the bottom 2 and having the staff/āfunding join the top 2 would result in far more impact for the world. That would result in a ~33% shutdown rate, which is way above what happens in the charity world and about double what happens in AIM right now.
Thanks for the inputāyou are certainly in a great position to judge this and I love this framework. I also agree shutting down earlier can be far easier, because if you are 3 years in with increasing funding, while realizing you arenāt up to much it could be difficult socially and status wise to pull out at that point.
A slight caveat I would have is that it might depend on where follow-on funding was coming from. In a closed system with limited EA resources, then yes the only important Factor might be how good a marginal bet the org is.
If an organisation with a lower marginal chance of of success managed to get decent funding from NON- EA sources then it might be worth continuing with a worse bet. For example if maternal health initiative got a big foundation grant or if the recently closed policy org for funded through a thinktank or government grant. One issue here is that often orgs need 3-4 years of operation before people will grant them much money (outside of EA ecosystem)
But I would imagine getting big outside funding isnāt super common for marginal bet CE orgs, if it has happened at all. Iām also not sure to what extent the source of funding should change our bet (this has been discussed on the forum but would love to see some math doneāmine isnāt good enough)
Another even less important caveat might be if talented people were so passionate about what they their initial org did, that they might not be able to easily maximize on their talent in another role.
I would be interested to get a vague idea of what CE founders usually end up doing after closing their orgs. Have many joined other higher performing CE orgs? This might be sensitive info though.
From the little I know of CE peeps I would imagine they are mostly doing pretty great stuff.
Joining another CE charity is pretty common, as is working at EA meta-orgs (AIM, GiveWell, etc.). I would guess that around 75% do something most people would regard as very high impact.
Agree regarding external marginal funding, but I would say, at least in AIMās case, this correlates with early-stage success.
Thanks for your thoughtful response, Joey. I had originally approached this issue more from the perspective of founders and leaders being less āsoldieryā for their projects, but I see that the funderās viewpoint, especially regarding the counterfactual uses of money, is quite different and valid.
One key difference is that the counterfactual reallocation of talent from failed AIM charities may not be as impactful as the reallocation of funds by AIM-adjacent funders. As you mentioned, many people who worked at a failed AIM charity are likely to join another CE charity or work for an EA meta org, but these roles are in high demand and often attract top-tier talent regardless. Itās not clear that the movement of talent between these organizations would have as large an impact as reallocating funds to more successful initiatives.
This is where the dynamic between founders and funders diverges. From the leaderās perspective, it might make more sense to continue to pivot, seek out other funding sources, and keep the project alive, particularly if they still believe in the long-term potential. On the other hand, from the funderās perspective, cutting their losses and focusing on capitalizing on wins may provide a much clearer path to maximizing impact. It seems that the optimal decisions for founders and funders could diverge, depending on their roles in the ecosystem.
I appreciate your insight into how marginal bets play into these decisions and how AIMās cohort-based structure could actually benefit from higher shutdown rates. It seems like thereās a balance between empowering founders to pursue potential breakthroughs while ensuring funders can make optimal reallocation decisions for broader impact.
Personally, I do not think we have swung too far on this. Even in the AIM/āCE cohorts (from which both of the recent public shutdown posts came), I still think people err too much on the side of keeping projects running when they are not performing.
I think how to think about shutting down projects comes down a lot to counterfactuals. Itās not that a project could not work or definitely will fail; itās about how good a marginal bet it is. Every dollar and high-talent hour going into the project could, in theory, be going somewhere elseāoften somewhere with pretty high impact. When I think about a cohort of 6 charities founded out of AIM, after 2 years, I would expect shutting down the bottom 2 and having the staff/āfunding join the top 2 would result in far more impact for the world. That would result in a ~33% shutdown rate, which is way above what happens in the charity world and about double what happens in AIM right now.
Thanks for the inputāyou are certainly in a great position to judge this and I love this framework. I also agree shutting down earlier can be far easier, because if you are 3 years in with increasing funding, while realizing you arenāt up to much it could be difficult socially and status wise to pull out at that point.
A slight caveat I would have is that it might depend on where follow-on funding was coming from. In a closed system with limited EA resources, then yes the only important Factor might be how good a marginal bet the org is.
If an organisation with a lower marginal chance of of success managed to get decent funding from NON- EA sources then it might be worth continuing with a worse bet. For example if maternal health initiative got a big foundation grant or if the recently closed policy org for funded through a thinktank or government grant. One issue here is that often orgs need 3-4 years of operation before people will grant them much money (outside of EA ecosystem)
But I would imagine getting big outside funding isnāt super common for marginal bet CE orgs, if it has happened at all. Iām also not sure to what extent the source of funding should change our bet (this has been discussed on the forum but would love to see some math doneāmine isnāt good enough)
Another even less important caveat might be if talented people were so passionate about what they their initial org did, that they might not be able to easily maximize on their talent in another role.
I would be interested to get a vague idea of what CE founders usually end up doing after closing their orgs. Have many joined other higher performing CE orgs? This might be sensitive info though.
From the little I know of CE peeps I would imagine they are mostly doing pretty great stuff.
Joining another CE charity is pretty common, as is working at EA meta-orgs (AIM, GiveWell, etc.). I would guess that around 75% do something most people would regard as very high impact.
Agree regarding external marginal funding, but I would say, at least in AIMās case, this correlates with early-stage success.
Thanks for your thoughtful response, Joey. I had originally approached this issue more from the perspective of founders and leaders being less āsoldieryā for their projects, but I see that the funderās viewpoint, especially regarding the counterfactual uses of money, is quite different and valid.
One key difference is that the counterfactual reallocation of talent from failed AIM charities may not be as impactful as the reallocation of funds by AIM-adjacent funders. As you mentioned, many people who worked at a failed AIM charity are likely to join another CE charity or work for an EA meta org, but these roles are in high demand and often attract top-tier talent regardless. Itās not clear that the movement of talent between these organizations would have as large an impact as reallocating funds to more successful initiatives.
This is where the dynamic between founders and funders diverges. From the leaderās perspective, it might make more sense to continue to pivot, seek out other funding sources, and keep the project alive, particularly if they still believe in the long-term potential. On the other hand, from the funderās perspective, cutting their losses and focusing on capitalizing on wins may provide a much clearer path to maximizing impact. It seems that the optimal decisions for founders and funders could diverge, depending on their roles in the ecosystem.
I appreciate your insight into how marginal bets play into these decisions and how AIMās cohort-based structure could actually benefit from higher shutdown rates. It seems like thereās a balance between empowering founders to pursue potential breakthroughs while ensuring funders can make optimal reallocation decisions for broader impact.