Investing Together

Promising Strategies from a Donor Collaborative

| Aurelia De La Rosa Aceves, David M. Greenberg

This is the final brief in a five-part series documenting the implementation of an economic mobility initiative supported by New York City’s Change Capital Fund (CCF). CCF is a consortium of New York City donors formed to invest in local community development corporations that undertake data-driven anti­poverty strategies integrating housing, education, and employment services. CCF has focused on building the capacity of these organizations to deliver coordinated and comprehensive services to program participants and to use data to inform program implementation. This brief draws on interviews with CCF funders and grantees to offer insights on the effective operation of an innovative “democratic” donor collaborative.

Two distinct characteristics make CCF worthy of study. First, CCF is a formal donor collaborative involving an extensive group of cross-sector funders. Such an alliance involves “pool[ing] money, time, and talent to advance a shared vision with multiyear goals,” or what is known in the philanthropy literature as “high-stakes donor collaboration.” Second, CCF is engaged both in capacity-building and in setting high standards for performance. This brief therefore highlights promising strategies that may promote effective donor collaboration and help donors manage the dual objective of building organizational capacity while setting ambitious program outcome goals with their grantees.

This brief comes at an opportune moment. There is growing interest in more formal collaboration among donors, given emerging discussions in the philanthropic sector about shared measurement, concerns about shrinking federal and state funding to nonprofits, and acknowledgment that a single donor organization may not be sufficient to help a service provider meet increasing demand or make headway in solving complex social issues. It is an important time, therefore, to discuss what it takes to develop a well-functioning funding collaborative — one that retains donors over the course of the initiative, promotes thoughtful yet streamlined decision making, and defines goals and tracks progress toward their achievement.