Foundations play a key role in the social-sector ecosystem as they seek to drive long-term social change and mission-aligned impact in the community. An effective approach foundation can adopt to support the success of mission-driven organizations in the community is through unrestricted, multiyear general operating support grants (GOS). Many foundation and non-profit executives report this form of unrestricted funding helps provide stability and increased outcomes due to the consistent focus on and investment in a nonprofit’s programs and staff. The National Committee for Responsive Philanthropy (NCRP), the TrustBased Philanthropy Project (TBPP), and Grantmakers for Effective Organizations (GEO) are just a few examples of organizations that are vocal when it comes to supporting the multiyear GOS approach. These organizations report that this funding:
Fosters grantee stability;
Encourages stronger, trust-based relationships between funders and grantees;
Creates space for innovation and risk-taking; and
Allows nonprofits the time to develop, evaluate, and improve programs that address systemic and complex social issues.
In a recent study from The Center for Effective Philanthropy, New Attitudes, Old Practices: The Provision of Multiyear General Operating Support, The Center for Effective Philanthropy cited Fred Ali, president of Weingart Foundation, and Belen Vargas, Weingart’s former senior vice president of programs as having argued that, “When combined with effective leadership and management, providing unrestricted multiyear core operating support is one of the best ways to build nonprofit capacity and sustainability.” Likewise, Vu Le, former Executive Director of the Seattle-based nonprofit RVC also weighed in with the thinking that “providing multiyear general operating dollars is the best way to strengthen organizations because it pays for staffing, provides stability, allows organizations to focus on the work they are good at, allows for flexibility to adapt to changing contexts, supports strategic risk-taking, and is more culturally responsive.”
Despite all of its positive benefits, the study highlighted that only 12.4% of grants made or received during the decade leading up to the coronavirus pandemic were both multiyear and GOS. So, if this form of funding is so valuable for both foundations and nonprofits, why isn’t it being used more often? A key reason is the lack of visibility into the outcomes and impact achieved with the funding. If foundations are not certain of how a nonprofit grantee is achieving long-term social change with the money they have already received, why would a foundation want to provide unrestricted multiyear core operating support? What foundations need is real-time data visibility into the impact of the different grantees in their portfolio.
Conditions and Criteria for Multiyear GOS
The real-time availability of impact data helps demonstrate how the grantee is aligned with the foundation’s mission and strategy. Not only does this data provide a benchmark prior to making an investment, it offers a slightly different, more objective way of conducting the mission-alignment check between the foundation and grantee. Grantees’ impact data serves to reinforce decisions for multiyear GOS investments solely based on the merit of the social impact they achieve.
How Foundations Can Boost Nonprofit Capacity
Because foundations are in the unique position of helping to build the capacity of their grantees so that they can make operational improvements that influence the effectiveness, outcomes, and ultimately the long-term sustainability of the grantees, it is critical that funding is channeled to solutions that have been vetted and are specifically designed for the social sector. SureImpact is one solution that enables grantees to collect, manage, and share data to demonstrate their impact stories, and gives foundations and other collaborators a real-time view to the insights they need to make important decisions.
SureImpact is a user-friendly case management and reporting platform that connects all members of the social-sector ecosystem. SureImpact simplifies foundations’ processes for determining which grantees are likely to drive the most impact, and aids in retrospectively summarizing the impact of investments. From identifying trends across organizations (and even within specific program areas) to automating a foundation’s ability to measure its total agency impact year over year, SureImpact’s cloud-based platform provides the context needed for large-scale, in-depth analysis. And from a program officer’s perspective, our solution also provides powerful agency-to-agency comparison views within a program officer’s portfolio. All of this data is available in real time, which for program officers means no more waiting until the end of a grant cycle to receive an emailed spreadsheet from each individual grantee. This provides opportunities to provide input, make recommendations, and build stronger relationships with grantees.
If your foundation is seeking to expand its strategic provision of multiyear GOS, contact SureImpact today. We’re eager to share how we can help foundations and nonprofits build out your technological infrastructure that will lead to more and better outcomes for the communities you serve.