I’ve spent the better part of eighteen months fundraising for different impact philanthropy initiatives. First around new animal models for complex disease, then for chronic pain. I’ve tried to unload as much tacit knowledge as I can, albeit mostly in person, over drinks.
Due to popular demand, I’ll expand on last year’s initial list of unintuitive things, and once again, distill ten more things I’ve learned about philanthropic fundraising. I hope this can be a resource for similarly ambitious, technical, and expensive philanthropic initiatives of the future :)
You can speed-run philanthropic fundraising at the seed stage
In this world today, there are likely <10 people/foundations who will:
give you 30min for a meeting
align with your mission/approach
write the desired checksize
AND match your desired timeline
If you do it well, it will only take 3wks-3mo to get to the 80-90% saturation point of all funders interested in your area. At that point, you can make a judgement call for whether or not there is appetite for your thing right now. There’s always a chance you’ll meet the last 10-20% of people in a few months/years, but do you really wanna be around for that? I generally think no.
3wks-3mo is enough time to check the temperature of the room for your work. If there isn’t great feedback, it’s okay to move on to the next thing.
Philanthropy doesn’t move at the speed of trust
Trust is of course the first step, but there’s much more that comes after. I think a lot of us have forgotten just how difficult it is to make people give away their money. In the private sector, we’ve artificially engineered ways to make people give away their money faster with FOMO, term sheets, valuations, chart patterns and Nancy Pelosi investment trackers.
We’ve gotten used to this cadence, which is why most private sector founders who move into philanthropy get vicious whiplash when they see the slower pace of philanthropic giving. In my experience, the most frustrating bottleneck in philanthropic fundraising is when the donor is not “ready”. Not because there’s not enough trust, but for simple reasons like they have not:
hired their Program Officer
set up their bank account
finished deciding their giving strategy
had their bi-annual/ennial board meeting
In these cases, philanthropy does not move at the speed of trust, but simply unavoidable org logistics. So don’t beat yourself up too much when these things get in the way of your success.
You can “buy trust”, sort of
Organisations like Science Philanthropy Alliance and Bridgespan work closely with philanthropists to help give away their money. They are like a consultant or advisor that helps donors think through what and where to give.
On the other side, they also work with prospective grantees and fundraisers to introduce them to these philanthropists looking to give away their wealth, for a fee. I don’t know these orgs personally, but they are relatively easy to get in touch with, as well as many other “philanthropic advisors” and “connectors” who you can contract to help you find donors. It’s a sort of strange thing quite unique to philanthropy.
There are also other “high trust” environments that quickly and automatically make you a “trusted” person. This could be like attending a Milken Conference or Skoll Forum, where being in the room itself is expensive, difficult, etc. This is not too different though from other sectors, where there’s always a high signal curated conference or two. The hardest part, beyond getting the invitation, is figuring out which gathering is truly high signal.
You should always raise as much money as you possibly can
Unlike in venture, where you want to price your rounds and watch out for overdilution, etc., in philanthropy you should just raise as much as you possibly can each time. Arguably, in philanthropy you’re fundraising all the time. In philanthropy, there is no term sheet or valuation. You have your mission, scale, and the timeline to success.
If you raise more money than you expected, great! You can expand your mission, hire one extra person, and do more, better work.
But this also creates a unique problem: you don’t know how much money to ask for. $10k? $100k? $10m? This is a common and universally tricky question. There are a few strategies for this:
Do your research on ProPublica, check the 990s, ask the models.
Ask donors directly about previous/recent gifts to gauge their “sweetspot” relative to their interests.
Just wing it and go off vibes.
None of these methods are objectively “wrong”. If anything, I’d argue any one of these options is great compared to the alternative: not asking.
Whatever the case, not asking is the worst thing you can possibly do. Both you and the donor might’ve talked for hours to weeks about your shared passion, vision, and mission. They want you to ask them for a gift. They want to consider it, because it matters to them.
It’s indeed kind of like asking that cute barista out on a date. Do everything to find that courage to ask. The world won’t change if we all stay silent.
You need to be able to answer: “Why not VC? Academia/government? Or China?”
Capitalism works. Government grants and innovation agencies continue to fund ambitious work. China is increasingly visibly ahead in several technological areas from neurotechnology to synthetic biology. These are not all bad things, but we must have short, descriptive answers when asked about the alternative routes.
Your philanthropic program cannot be an unprofitable startup, or a more expensive version of what you could create/buy in China. There must be a real reason and edge to why it uniquely has to be done with philanthropic capital, for how long, and what the go-to-market would be afterwards.
If you’ve met one donor, you’ve met exactly one donor.
I cannot emphasize enough how different each donor is. Several months ago, I would’ve said there are only a few donor archetypes. Now, I’m not so sure. Some donor types I’ve met:
Eccentric billionaire
Deeply technical person in your domain
Intelligent financier who knows nothing about your niche science/tech.
Social activist in your cause/area
Social activist in your cause/area who disagrees with your approach
Still learning about themselves
Donors are people. They aren’t walking checkbooks, and they certainly aren’t VCs that can be archetyped as “Generalist” or “Deeptech” or “Founder friendly”. They don’t have set remits or expectations from LPs to deploy capital fast. The types of donors can vary widely, so don’t be upset if a donor, or three dozen donors, says no.
Keep going. Keep looking.
Impact philanthropy is still largely a policy-first problem
America is still one of the leading examples of successful philanthropy. Yes, there are many more centimillionaires and billionaires in America than in other countries. But being wealthy doesn’t automatically make someone give.
Wealthy people want to do good work, but they also want tax breaks. America has very flexible giving rules that allow gifts across many sectors to be a tax break. This includes arts and music of course, but also science research and even think tanks.
In contrast, in the UK and Japan, there are more rigid rules around giving and less or no tax breaks for giving in science research or modern philanthropic orgs, making impact philanthropic giving not only unfavorable but largely absent in the culture.
For example in the UK, you cannot get a tax break from directly giving money to a research lab. Let’s say you want to support an academic lab doing cancer research. In the US, you can give your money straight to the lab and get a deduction. But in the UK, you have to pass that money through a registered charity, through its own governance and processes, to distinguish the gift as charitable rather than personal. This friction creates real blockers to effective, fast giving.
In Japan, donations are only deductible if they go to a government-certified nonprofit. To be certified, orgs must pass a “public support test” that requires them to have 100+ people each giving a few thousand yen a year, rewarding popularity that encourages traditional charity creation. Arts groups, welfare charities, and disaster relief orgs pass these criteria, but many frontier science orgs like Focused Research Organisations (FROs) are supported by just 1-3 individual donors. This makes it impossible for one donor to receive a tax break from creating a new FRO in Japan.
Therefore, if countries want to unlock domestic philanthropic giving for sovereign growth, the highest leverage intervention point may be policy entrepreneurship.
Philanthropy and capitalism has always been, and will always be, synergistic
Throughout American history, the best philanthropy has historically been done by the best capitalists. JD Rockefeller and Andrew Carnegie for example were very successful in their businesses, and they ran their philanthropy with similar rigour.
21st century philanthropy is not, and cannot be, “soft”. It should focus on the hardest problems “orphaned” not only by the markets, but technologically and culturally too. If philanthropy is done very well, it can create new technologies to be commercialised later, help people, even creating new fields of science & technology along the way. If anything, philanthropy is exactly for the “uber freemarket capitalists” who can recognise that many civilisation-scale technologies from vaccines to neurotechnology face a market failure with high CapEx that make private financing difficult.
Venture philanthropy was v1 of this, and what we see in the next decade will be v2.
>90% of your conversations won’t be with donors, especially if they’re IRL
Fundraising, at least in my experience, is like solving a massive, 97-dimensional puzzle. You’re trying to draw the web of human connections and relationships to figure out who knows who and how well to ask for what intro. Oftentimes, a non-donor who instead knows many donors is more helpful than just meeting one donor. When you’ve met one donor, you’ve met exactly one donor.
IRL, donors also usually won’t step out for conferences or events you’ll attend. Let’s face it, if you’re really rich, wouldn’t you also rather be making flying cars on your private island instead of going to a meeting to talk about spending/giving money? I personally would be at a Charli XCX concert or maybe Slowboat in Hokkaido.
None of this may apply to you
Philanthropy is still an incredibly inefficient, idiosyncratic marketplace. YMMV (your mileage may vary) is an understatement. Some have found success with niche math orgs that took a long time to fundraise for, all the way to highly technical drug delivery orgs.
I would not personally have thought these projects would succeed to fundraise so quickly, but I hope this speaks exactly to how unpredictable this all is. As you go through your own philanthropic fundraising journey, you’ll meet many different kinds of people — allies, donors — face many challenges, or none at all.
If you’ve read this far and are still interested or even inspired, then it’s probably worth doing. It’s hard, it doesn’t make sense, but what does nowadays?
Some final notes about what I do know:
There’s a lot of money in this world, sitting idly.
There are many ambitious founders and funders waiting to meet each other.
Rich people don’t like to be courted.
Most people want to do good things, they just don’t know how.
Get after it.
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