Through an agreement with the Stanford Social Innovation Review, PND is pleased to be able to offer a series of articles and profiles related to the "business" of improving society.

Against "Big Bets"

Against "Big Bets"

I do not think it controversial to say that philanthropy is infatuated with the idea of novelty. What matters these days is to be "transformative," to show how you are "innovating" and being "disruptive." The latest craze is "big bet philanthropy," described in a December 2016 Forbes article as "an eight-figure-or-more attempt to create systematic social change."

Citing research from the Bridgespan Group that formed the basis of Stanford Social Innovation Review's Winter 2016 cover story, "Making Big Bets for Social Change," Forbes acknowledges that past philanthropists occasionally sought social change but maintains that today's big bettors differ in their greater willingness to use "disruptive try to actually solve problems rather than salve wounds." Forbes being Forbes, the article naturally concludes with a list: a ranking of the ten "most promising big bets" of 2015, accompanied by a further inventory of forty-eight other contenders. (In the interests of full disclosure, a grant of $33 million made by the William and Flora Hewlett Foundation to the European Climate Foundation is included among these "other big bets.")

While talk about "big bets" seems everywhere, it is not entirely clear what the phrase means, beyond committing to spend a lot of money on something. Every writer on the subject seems to use different criteria. The idea must entail more than a concerted effort to accomplish something beneficial to society, since that would encompass pretty much everything every major foundation has been doing for decades.

Sometimes, putting money into solving a specific problem seems to be a defining feature. But not always, as evidenced by the inclusion of support for scholarship funds, university endowments, open-ended research, and even the maintenance of a single park. Other times the important thing seems to be offering major support to a particular organization, though a number of bets singled out for recognition are broader than this. Near-term results often seem likewise to matter, though it is not clear whether big bets must be strategic or designed to achieve a specific measurable impact, and a number of them plainly are not.

Ultimately, this imprecision reflects the fact that "big bet philanthropy" is more of a sensibility than a defined technique. This is, as I will explain below, a major cause for concern, because it invites sloppy thinking and bad practice. Broadly speaking, though, what most proponents have in mind when referring to a big bet is an announced intention to invest a large number of philanthropic dollars — both Forbes and Bridgespan use eight figures as their minimum benchmark — to solve a significant problem in short order, often by supporting a single organization. That description does not capture all the examples, but these features pervade the discussion and, more important, accurately reflect how the expression "big bet" is being absorbed by the field.

An Insidious Tool

Before laying out my misgivings about this sort of philanthropy, I should be clear that I do not believe it is always bad or wrongheaded to give a lot of money all at once to solve a complex social problem quickly. On the contrary, there surely are problems that can be addressed this way.

Still, to say that it might make sense, in rare instances, to do this is a far cry from saying that it is the best way to do philanthropy or even a very good one, much less an approach that ought to be pursued as the norm. And make no mistake, whether they mean to or not, this is what the proponents of big bet philanthropy are peddling. Their writings are rife with laments about the rareness of big bets while celebrating the audacity and vision of the bold few who pursue the tactic. The message is unmistakable: If you want to be a leader in philanthropy, if you want to "solve problems rather than salve wounds," this is the way to go.

The Forbes list is an especially insidious tool for promoting big bets over other forms of philanthropy. Having been a law school dean, I have firsthand experience with the tyranny of rankings, which ineluctably generate competition to make the grade and so cause everyone to fetishize whatever the ranker values. In the case of law schools, this has led to overemphasis on standardized test scores and on spending money even when it does not benefit students (thus raising tuition and debt). In philanthropy, it will just as surely induce philanthropists to favor huge investments, often to single organizations, on risky strategies that seek quick, early payoffs.

The new generation of young philanthropists, many intensely eager for public recognition and approval, are particularly susceptible to this siren song. How awesome to be singled out as a leader in philanthropy, to be written up in Forbes, maybe even in the New York Times! How maddening to remain unnoticed while one's friends and peers get all the attention!

Then again, so what? Why not encourage philanthropists and foundations to seek out and make these sorts of bets? Because social problems — at least the big ones that really need and can benefit from philanthropy — are difficult, complex things. Physical diseases can be cured by inventing a drug or vaccine, but social problems are seldom susceptible to one-shot solutions. There are no silver bullets, no shortcuts, when dealing with poverty, racism, climate change, education, women's rights, or income inequality, to name only a few of the significant problems that philanthropy addresses; working seriously on these requires a different mindset altogether.

Social problems are bred and live inside obdurate systems of clashing interests; both causes and solutions alike depend on people, with all the unpredictability and confounding behavior they entail. Progress is slow, not from lack of imagination or willingness to take chances or to invest enough money, but because the problems are just plain hard.

The sort of philanthropy required to make progress on challenges like these is very nearly the opposite of that being pushed by big bet enthusiasts. It takes money, to be sure. But it also takes time and patience — a great deal of both, in fact — and a commitment of human as much as financial resources. It takes willingness to learn from others and to develop real partnerships with grantees, while hearing from (and listening to) intended beneficiaries.

It is not about pushing lots of cash out the door while looking for speedy results, but about becoming part of and helping to nurture an ecosystem of grantees, beneficiaries, and other funders whose efforts, cumulatively and over time, help make progress. It is about coming to understand a problem deeply, developing a thoughtful approach to address it, observing what happens, changing one's understanding based on evidence and experience, and — most important — being willing, if need be, to take these same steps over and over again.

Patience Over Posturing

This gets to the nub of my reservations about big bet philanthropy. To me, it feels too much about making bold statements, too much about posture and attitude and fanfare. It feels too much about philanthropists showing the world who they are and too little about the philanthropy itself. I know this is not what big bet promoters intend, but it is nevertheless how they sound and (intentionally or not) what they encourage. A true big bet in my book is a commitment to work on and stick with a problem long enough to make a difference, which ordinarily means making strategically placed grants to many grantees over time, most too small to rise to the level of a big bet in Forbes' or Bridgespan's terms.

I am proud of the Hewlett Foundation's very large grants, but I am as or more proud of the work it has done in areas such as conservation — a focus of grantmaking since 1969. The foundation has, in the years since then, spent upwards of $350 million conserving land and improving rivers in the American West, learning along the way from and with its grantees and fellow funders how to build coalitions and balance conflicting interests to achieve consensus around our goals.

Spending quietly but steadily, progress has come in fits and starts. There have been gains but also losses, as we made mistakes from which we learned and endeavored to adapt to a constantly changing political and cultural landscape. But gradually, by dint of persistence and steadfast attention, our grantees have achieved significant results.

We facilitated their work by spending approximately $20 million per year in recent years (less in earlier years), spread across many grantees. No single one of these grants was large enough to capture the attention of Forbes journalists, but together they represent the patient, steady work and purposeful, sustained focus required for progress.

The same can be said for our efforts in other areas, such as conflict resolution, women's reproductive health, open educational resources, arts education, and more. In all these fields, the foundation made decades-long commitments and achieved meaningful impact not by virtue of flashy big grants, but through the conscientious, sustained, strategic support of countless organizations working on different aspects of the problem.

Nor is Hewlett the least bit unique in this regard. Every major foundation has made and is presently making similar bets in its various programs, and each could provide similar examples of long commitments to difficult problems worked on steadily to achieve laudable results.

Have all these grants been successful? Of course not — though there is exactly zero evidence that big bet philanthropy has been any more successful. These are, remember, enormously difficult, intractable problems. Strategic philanthropy entails risk no less than big bets. And we should acknowledge its importance and effectiveness — and encourage more of it. This is how wars are won: by infantry, grinding it out on the ground. These are serious times, and they call for steadfast commitment and perseverance, not quick fixes or attention-grabbing novelties.

Larry Kramer is president of the William and Flora Hewlett Foundation. He is grateful for thoughtful comments from Jeff Bradach, Paul Brest, Ruth Levine, and Fay Twersky.