Note: Steve Daetz of the Sandler Foundation reviewed a draft of this post prior to publication.
Previously, we wrote about the tradeoff between expertise and breadth in philanthropy. We noted the traditional “program officer” model of philanthropy, in which staff specialize in particular causes, and we contrasted it with some other possible models that sacrifice true cause-level expertise, while allowing a philanthropist to work in more areas at once.
We cited the Sandler Foundation as an example of a foundation that appears to have a strong track record despite not following the traditional “program officer” model. Since then, we’ve had a couple of extended conversations with the Sandler Foundation’s Herb Sandler and Steve Daetz. We’ve tried to understand better how its approach differs from more traditional approaches, and what the pros and cons are. We’ve come out thinking that:
- The Sandler Foundation appears to have an impressive track record; it has played major roles in the development of multiple impressive organizations. More
- The Sandler Foundation does seem to have noticeable differences with the more traditional approach. Its staff are not subject matter experts specializing in particular causes, and they do not operate with fixed budgets for the amount of time and money spent on a cause. Rather, the Sandler Foundation is highly flexible and opportunistic, ready to put a lot of time and money into an idea when they find the right leadership, or stay out of a cause of interest entirely when they don’t. They often put a lot of time and energy into investigating and refining a grant early on, to the point where working on a single grant becomes a major part of their agenda; this is temporary, however, as they have a preference for reliable, recurring, flexible support (rather than continuously revisiting and revising the terms of grants). More
- In many of the ways that the Sandler Foundation differs from traditional foundations, we think the Sandler model may be preferable. More
- In 2003, the Sandler Foundation provided the initial funding (then about $2.5 million) for the Center for American Progress, a major progressive think tank with current expenses around $40 million per year. We know fairly little in the way of specific claims about the Center for American Progress’s impact, but it appears to be one of the larger and better-known parts of today’s progressive political infrastructure.
- In 2007, the Sandler Foundation played a major role in conceiving, assembling and funding ProPublica, an independent, non-profit newsroom that aims to produce investigative journalism in the public interest. ProPublica publishes lists of cases in which it believes its investigative reporting to have had tangible impact and has won many awards.
- The Sandler Foundation also played a significant role in the creation of two other organizations that we know less about, but perceive as generally well-regarded: Center for Responsible Lending (which fights predatory lending practices) and the newer Washington Center for Equitable Growth.
- We were also impressed with the Sandler Foundation’s account of its role in helping the Center on Budget and Policy Priorities (CBPP) improve its communications capabilities. Our understanding is that the Sandler Foundation hired a communications consultant for the organization, and has been funding CBPP since then to help it build out its communications department as well as expand its capacity for state fiscal work. We see CBPP as being a highly impactful organization, and we plan to learn more about its work through our History of Philanthropy project. (See our conversation with Robert Greenstein of CBPP for more on their track record.)
I’m generally interested in cases where a foundation played a major role in the development of a strong and important institution, and at this point we’ve spoken with the heads of many major foundations and asked them about their major success stories. I think the above list compares favorably with comparable lists I’d be able to put together for other foundations’ work over the last decade (based in many cases on off-the-record conversations). This isn’t necessarily a fully appropriate comparison, since the Sandler Foundation explicitly prioritizes making large grants and helping to start organizations; it’s possible that other foundations have had equal or greater impact with larger numbers of smaller grants, and that it’s simply hard to put together comparable lists of highly tangible “success stories.” Still, my impression is that the Sandler Foundation has been quite successful in helping to build strong organizations, despite having a much smaller staff – and less subject-matter expertise – than traditional foundations.
1. The priority placed on funding strong leadership. The Sandler Foundation emphasized its preference for flexible, long-term support rather than constantly picking and prescribing projects. This sort of support is likely especially valuable to grantees, and even more so for new organizations trying to attract outstanding talent. At the same time, giving flexible and long-term support is a major “bet,” and seems most appropriate when one has very high confidence in the leadership one is supporting. The Sandler Foundation emphasized its extensive due diligence on leadership (for example, Sandler Foundation staff had over 30 conversations about John Podesta before supporting him to start Center for American Progress), and its high expectations for leaders: it aims to support people who are highly strategic, highly receptive to criticism and interested in self-improvement, and highly aligned with the Sandler Foundation on values and communication (“good chemistry” was emphasized).
2. A high level of “opportunism”: being ready to put major funding or no funding behind an idea, depending on the quality of the specific opportunity. The Sandler Foundation emphasized its lack of well-defined “budgets” for either money or time: its staff are often exploring several ideas at once with a low level of time commitment, and ready to substantially raise their involvement when a good opportunity presents itself. In the case of ProPublica, the Sandler Foundation first developed the basic idea for a nonprofit newsroom in 2006, and had 15-20 conversations with potential leaders; in May of 2007, when they met Paul Steiger, they quickly became interested in funding him and started putting much more time into the idea. At the same time, there are some cases in which the Sandler Foundation has explored an idea or an issue for a considerable period of time, and ultimately decided not to make any major grants. The general pattern seems to be that the Sandler Foundation puts a great deal of “front-end energy” into promising grant opportunities they’ve identified, and spends relatively less time on (a) pursuing ideas for which strong leaders haven’t yet been identified; (b) following up on a given existing grant (though it still spends substantial time on those as well).
The Sandler Foundation believes that cause-specific “program officers” are a poor fit for this model. The Sandler model relies on strong assessment of organizational leadership, with relatively few, large grants to trusted leaders. Program officers tend to have incentives to make more, smaller grants, and tend not to be well positioned for the funders to defer to their judgments about organizational leadership. Program officers also typically want pre-specified budgets, which the foundation leadership worries would make them insufficiently opportunistic.
- We aren’t fully aligned with the Sandler Foundation’s values and priorities, and we believe that our set of policy priorities doesn’t map very well to today’s most common political platforms. Because of this, it could be particularly hard for us to find leaders whom we feel fully aligned with.
- We believe the “expert philanthropy” model has much to recommend it (more), and we plan to experiment with it.
- We believe there can be a good deal of value in relatively small, low-confidence, low-due-diligence grants that give a person/team a chance to “get an idea off the ground.” We’ve made multiple such grants to date and we plan on continuing to do so.
- We have a favorable impression of the Sandler Foundation’s track record, but we don’t have enough information to be highly confident in this.
With that said, we see the Sandler Foundation as something of a proof of concept that high-impact grants can come from opportunistic generalists.
For reasons outlined previously, we’re highly interested in trying out a philanthropic model that looks across multiple issue areas for the very most outstanding opportunities, and we think that taking a highly opportunistic approach – scanning multiple areas, waiting for outstanding leadership, keeping the bar high, and being ready to get very involved when an opportunity comes up – makes a great deal of sense for this goal. By taking this attitude toward many of our focus areas, we might be able to make the most of our generalist staff, and be able to keep our bar high for the opportunities we get most involved in (something that would be more difficult to do if we pre-committed to a smaller number of particular issues and ideas).
Note: another perspective on the Sandler Foundation is available in a January piece from Inside Philanthropy.