Changing Philanthropy to Change the World: What Can Intermediaries Bring to This Moment?
A growing cohort of new and existing intermediaries focusing on movement building are on the cutting edge of the philanthropic sector, delivering resources and expertise to groups like only they can.
In this issue, we explore the benefits intermediaries can bring to larger funders and how they can shift the entire sector.
We spoke with Dr. Elisha Smith Arrillaga of the Center for Effective Philanthropy and Santana Moreno of the Emergent Fund to better understand intermediaries and their strategies.
What are philanthropic intermediaries?
Philanthropic intermediaries come in many forms, a reflection of how this part of the sector has grown and diversified over the past decade.
As Nonprofit Quarterly describes them, intermediaries “fit no single description other than that they are typically employed to fulfill a mission-critical role ‘in between’ the foundation and its intended beneficiaries. [Intermediaries] can be utilized for regranting, hosting pooled funds, program design and management, fiscal sponsorship, and a variety of efforts to build organizational and personal capacity.”
The term at its broadest contains organizations that have granted billions of dollars combined, including community foundations, collaborative and pooled funds, giving circles, philanthropy servicing organizations, and donor-advised funds.
For the purposes of our discussion today, we are focusing on a growing cohort of new and existing intermediaries. Rooted in social and racial justice movements over the past 10-15 years, they are on the cutting edge of the philanthropic sector, delivering resources and expertise to groups in ways that only they can. A recent report by the Bridgespan Group found that the number of philanthropic collaboratives, which are a kind of intermediary, have more than tripled since 2000, with their growth accelerating in the 2010s. Bridgespan found that many focus explicitly on pressing issues of gender equity, racial equity, civic participation, and climate change.
But why are intermediaries needed, and what benefits can they bring to the sector?
Intermediaries Shift Funds — and Power
First and foremost, intermediaries are “closer to the ground”: they tend to have closer relationships to local communities, greater awareness of emerging grassroots and movements, and deep knowledge of the political and social terrain. These intermediaries often have staff and board members with longstanding and direct experience in the social movements they serve.
The philanthropic sector, its existence a product of wealth stratification, is itself stratified, with relatively few large foundations and individuals holding the bulk of resources and power. The relationships and knowledge that intermediaries hold are what separate them from larger funders that, often simply due to matters of scale, simply cannot do the same.
Intermediaries, as institutions that both receive and make grants, provide an indispensable conduit for larger funders to make the impact that many of them seek. As a group of intermediary leaders wrote in an SSIR essay last year:
“A critical mission element of movement-accountable intermediaries is to circumvent the unjust design of institutional philanthropy. Although replication in a system can be important for building resilience, in a system with such power imbalances, we try to minimize duplicative efforts and build symbiotically…
They manage the administration, scoping, vetting, planning, and evaluation of thousands of grants. Larger funders, which often do not have the infrastructure and relationships to reach grassroots organizations, can invest in intermediary funds to learn from and partner with local, regional, and global movements.”
Intermediaries Bring Connections and Relationships
Elisha Smith Arrillaga, CEP’s Vice President of Research and co-author of a recent report examining grantee perspectives on intermediaries, said in an interview with Philos that the relationship between intermediaries and their grantees can bring a host of unique benefits. “In the best cases, the intermediary is an ally to the grantee,” Arrillaga said. “Some are closer to the communities that nonprofits seek to serve and can therefore have greater insight into the true needs of the nonprofit and the community. There are great supportive roles that intermediaries can provide.”
That kind of practical assistance is crucial for new and small groups, many of whom start out as either all-volunteer or with just a single part-time staffer to guide the work. Those organizations do what legendary civil rights organizer Ella Baker called the “spadework” of democracy: the difficult, patient, and often unseen work that lays the foundation for transformative change. Such groups are not only invisible to much of philanthropy, but their more informal organizational structure would make it impossible for many large institutions to fund them.
Supporting this spadework is where intermediaries can excel, and larger foundations can rely on intermediaries to see that work supported. Intermediaries are often on the leading edge of trust-based and participatory grantmaking practices, which give them more flexibility in both the kinds of groups they grant to and the reporting requirements (if any) attached to the grants.
The CEP report also notes that some of relationship and trust work that grantees appreciate most do not need to solely reside in intermediaries, and could be adopted to some extent by larger funders: “though intermediaries may face constraints that are different from those of other funders, certain practices and approaches can contribute to better grantee experiences and be adopted across a variety of organization types and structures.”
There are great supportive roles that intermediaries can provide.
Intermediaries are Nimble
The Emergent Fund is a rapid response fund designed to move resources to frontline organizations that need it most. As Santana Moreno, Director of Philanthropic Partnerships puts it, the establishment of the Fund was itself a rapid response:
“The Emergent Fund was founded in 2016 in the wake of the first Trump election, created by a group of women philanthropists and organizers coming together. It was an immediate response to what became clear at the beginning of that administration, which is that emergent rapid response organizing is necessary, and that it was already happening, but there was a gap in rapid response funding for grassroots work,” Moreno told Philos.
Emergent Fund’s grantmaking is led by an advisory council, comprised entirely of organizers who bring their movement expertise to the Fund’s work. Grants are awarded monthly, and they can move funds within a week of allocation. That kind of nimbleness, which is common among many intermediaries, simply cannot be replicated by the largest foundations in the sector, which are often limited by complex approval systems, minimum budget sizes for grantees, and extensive due diligence work for grantee onboarding.
As is often the case with movement-focused intermediaries, the staff of the Emergent Fund do their work while operating within a political and organizational tension: keeping one foot in the grassroots and another foot in the more rarefied corners of institutional philanthropy, where the funds their grantees need are held. “The role we always play in those spaces is to ensure that there’s a grassroots perspective and strategy incorporated,” Moreno said.
At the Schott Foundation, we were the first in the sector to establish a participatory rapid response fund amid the emergence the COVID-19 pandemic, in response to the sudden and extreme needs of our grantee partners and the communities they work in. With grantmaking led by a team of grassroots advocates doing the work, the Loving Communities Response Fund could pivot later that year and expand its remit to encompass the changing nature and needs of movement groups amid the George Floyd uprising.
This rabble-rouser role is much needed right now in particular, as much of traditional philanthropy is tightening its funding and acting fearful to stand up against the fall of democracy that we're facing right now.
Intermediaries Can Respond to the Crises of Today and Nurture the Movements of Tomorrow
The role of the intermediary extends far beyond the funders that support them and the grantees they in turn support. Intermediaries can also be powerful convenors: trusted groups that can bring groups and movements together in ways that others could not.
For example, the Alliance to Reclaim Our Schools is a national organization that for a decade has brought together community groups, funders, and educators to forge and pursue a common advocacy and policy agenda, navigating political and strategic differences in a space of trust and support.
“AROS’ unique role is the ability to bring many different groups into one space,” says AROS National Coalition Director Moira Kaleida. “We don’t typically have spaces where NEA and AFT organizers can come together — let alone in collaboration with community organizations, faith leaders, parents, and students.”
The Alliance itself emerged from a cross-movement convening that the Schott Foundation joined with partners in 2012: funders, parent organizers, youth leaders, researchers, and unions united around a vision of education justice. The Alliance is fiscally sponsored by Schott.
Intermediaries are a way for program officers to support bold new strategies and grassroots movements for equity and justice without needing to shift their own organization’s strategic plan or the priorities of their board.
Intermediaries, by leading through example and by raising overlooked issues among funders, are fulcrums around which philanthropy can turn.
‘“This rabble-rouser role is much needed right now in particular, as much of traditional philanthropy is tightening its funding and acting fearful to stand up against the fall of democracy that we’re facing right now,” Emergent Fund’s Santana Moreno said.
“Philanthropy needs to fund intermediaries, fund PSOs [philanthropy servicing organizations], fund the organizations that help to organize the philanthropic sector, and help to create a link between movement and movement and philanthropy. And they need to unlock their own coffers significantly. If every large foundation doubled their payout this year from 5% to 10%, they would still hold onto massive wealth, but that doubling of payout could potentially mean we can protect our democracy this year,” Moreno said.
While there is no silver bullet, the growth of intermediaries presents opportunities for both funders and grassroots grantees to move ever more funds to individuals, groups, and communities who need it most and can use it best.
If you would like to see more insights from changemakers in philanthropy and analysis of this changing sector, consider partnering with the Schott Foundation for Public Education. Connect with Sabrina W. Horton, Senior Vice President of Partnership Engagement to learn more.