How to Identify the Next $100 Million Program
It’s a question I’m often asked:
How do leaders of one of America’s oldest philanthropies decide which problems, out of the many facing humanity in the 21st century, will receive significant amounts of funding to help uncover solutions or bring them to scale?
Is there a check list we follow? An instinct? Do we pick from random and hope for the best?
The answer is much more rigorous, inspired by the way that venture capitalists source and landscape their own investments, and necessitated by two realities: first, that philanthropy no longer has the resources on our own to solve all of the world’s problems. Second, philanthropy’s dollars are tax exempt in the United States, and can be exercised in ways that others’—from business or government—are not. So there is an added burden and privilege for us to determine where our precious dollars are best spent.
To ensure that I, along with my board and executive team, can reach informed decisions, early in my Foundation presidency, we refreshed our strategy model, and put into place what we call our “scan and search” process. The first step is to listen to our networks and engage partners to identify problems on the horizon, do heavy duty research to understand the facets of the entire problem space, and then analyze the drivers and potential opportunities for intervention.
We use that research and data to answer four primary questions:
Is the problem pressing?
To understand this, we look at a range of characteristics including the problem’s scale, scope, urgency, and implications for poor or vulnerable populations. For example, when we were deciding whether to make a large investment in what became our Digital Jobs Africa initiative, the problem was stark: Africa has the fastest growing youth population, but not the job creation to keep pace. By 2020, Africa’s youth population will have reached 246 million, requiring another 74 million jobs to prevent youth unemployment—which is already staggering—from rising. If we do not, there will massive economic and social consequences, not only for youth, but for their families, communities, and the potential of this emerging market.
Is there dynamism?
The “pressing” criteria alone is not enough to consider intervention. Next, we look at whether the problem is at or near a tipping point. Is there critical mass of interest and support from the right stakeholders? In the case of Digital Jobs Africa, there was a confluence of several factors that created this dynamism, from the growing support of government for the growth of the information technology communications sector to the expansion of businesses, both African and multi-nationals, driving the need for skilled labor and business process outsourcing.
Is there opportunity for significant innovation and impact at scale?
We look for spaces where there is opportunity to create change on a systems level, with the potential of improving many lives or changing entire practices that can be sustained after philanthropic funding has ceased, often by using some of our unique risk capital to foster longer term, market based solutions. And we set ambitious goals. For Digital Jobs Africa, we believe that by working to achieve three outcomes—increasing demand for disadvantaged African youth in the workforce, helping youth acquire prerequisite skills for employment in digital jobs, and creating an enabling environment for digital jobs—we will be able to impact 1 million lives.
Does it fit within our goals and align with our capacities?
Once we’ve established the first three criteria, we ensure that Rockefeller is the right actor to execute this intervention. Can we leverage support from other sources by multiples? Do we have the experts and credibility in the targeted geographies? Is it a direct tie with our issue areas—revalue ecosystems, transform cities, advance health, or secure livelihoods—or our goals to build resilience and promote inclusive economies.
Digital Jobs Africa is directly related to our focus are, Secure Livelihoods, which seeks to expand opportunity and promote inclusive markets in the changing global economy. Our long history and presence in Africa has positioned us to take the lead—and in May 2013 our Digital Jobs Africa initiative was launched with nearly $100 million in funding over seven years.
Of course not all problems can meet all four criteria and move into what we call “execution.” But for us, it’s not just about those initiatives that get the green light—it’s about the journey and the knowledge collected along the way. To read the insights and access the resources we’ve gathered from more than a dozen problem spaces, please visit www.rockefellerfoundation.org/insights. Because this innovative process is not just designed to serve our own funding decisions, but to help others seeking to achieve outsized social or environmental impact.
That’s how we make our decisions—how do you make yours?[ssba]