The GiveWell Blog

DonorsChoose vs. Kiva

This Tactical Philanthropy post implies that the salient difference between DonorsChoose and Kiva is that DonorsChoose is more “authentic” in terms of connecting donors to projects. (Update: Sean points out in the comment below that most of the post I cited was a quote from a former DonorsChoose employee and doesn’t necessarily reflect TacticalPhilanthropy’s opinion.)

We think there’s another important difference. Kiva and DonorsChoose work on very different types of problems, that offer donors vastly different opportunities to cause significant impact. And if we had to pick one, we’d bet on Kiva as the better option if you want to change lives.

The problem of improving children’s education is far, far more difficult than most people suspect – for our most recent coverage, see our multi-part series on the recent Harlem Children’s Zone study, and how excited the academic community has been over a one-time and modest improvement. And DonorsChoose does not offer the chance to support any of the most promising and tested educational interventions, such as the creation of intensive charter schools. Funding DonorsChoose is making a bet that classroom materials are where it’s at, even when the teachers, school systems and children’s outside environments remain the same. As far as we know, there is zero evidence that improved school supplies have resulted in any measurable improvements in the U.S., and even in the developing world the proposition seems iffy.

Funding Kiva, even if it doesn’t mean funding individuals, means funding microfinance charities. We are very ambivalent about microfinance; recent posts on this topic include questions about whether there’s any empirical support for microfinance charities’ claims and an interview with David Roodman about microfinance charity in which many unresolved questions come up. But the bottom line is that when you fund microfinance charities, your money ends up in the poorest parts of the world, and often (though we don’t know how often or how much) helps people there manage their volatile financial lives with credit, savings and other assistance.

(In fact, the way in which your money is most helpful may be by doing exactly what it has been criticized for doing – effectively funding partners’ other projects, such as savings vehicles, rather than the loans you see on your screen.)

Fund financial services in the poorest parts of the world, or fund an untested and low-intensity approach to a problem that higher-intensity programs have struggled with for decades. $900 can be five digital cameras for a classroom or a year’s income for 3 people.

That’s the decision as it looks to us, as we ask not “How can I make sure that I can see the exact person who’s getting my money?” but “How can my money accomplish as much good as possible?”

And on that note, we feel that our top-rated charities offer far better opportunities to improve lives than either, even if they can’t deliver the same emotional experience. As a donor, which would you rather have?


  • Sean Stannard-Stockton on October 14, 2009 at 5:19 pm said:

    Holden, the post you link to is mostly made up of a comment made by an ex-employee of DonorsChoose. The text that I wrote in the post just referenced what other people were saying. So I certainly didn’t mean to imply that the salient difference between DonorsChoose and Kiva is how they connect donors and projects.

    For the most part in the Kiva debate I’ve been 1) reporting on the debate, 2) agreeing that Kiva’s communications about their process has been misleading and 3) commenting on the debate itself and how Twitter is changing the dynamics of the debate.

    Personally, I generally believe that funding high performing nonprofits is the best way to create impact. I agree with you that it is likely that Kiva does more to change lives than DonorsChoose. I highlighted the comment form the DonorsChoose ex-employee because it offered a perspective that post-funding dispersal was viable.

  • Mike Everett-Lane on October 21, 2009 at 10:20 pm said:

    Hello Holden,

    As the author of the post in question on Tactical Philanthropy, I thought I’d respond. The recent debate about Kiva has centered not around their effectiveness, but about their honesty in portraying how an individual donor’s dollars are spent. Kiva implies that a donor’s actions help determine which individuals receive loans. This is not the case.

    I of course applaud the work that Kiva has done for poor people around the world, and its transparency relative to others in international development, as you point out. I’m concerned that when some donors find that they have been misled, they may stop giving to an excellent charity.

    A purely rational donor would, as you point out, want her donations to go to the most effective and efficient use. But donors aren’t purely rational beings, because donors are human. One might decry the use of emotional appeals based on “tracing dollars to a specific individual,” but it’s Kiva that has used this as a marketing strategy.

  • Holden on October 22, 2009 at 5:12 pm said:

    Hello Mike,

    Thanks for the thoughts. We agree that it is important for charities not to mislead donors, and we understand your wish to clarify that DonorsChoose does not have the same issue that people are concerned about with Kiva. However, we hoped that the question of impact was not lost in the focus on the narrower point.

Comments are closed.