In 2017, the MacArthur Foundation launched 100&Change, a philanthropic competition awarding $100 million to a single proposal that “promises real and measurable progress in solving a critical problem of our time.”
As the year came to a close, MacArthur announced the initiative’s inaugural winners — the Sesame Workshop and International Rescue Committee for joint work to educate Syrian refugee children. It was around this time that Cecilia Conrad, MacArthur’s senior advisor for collaborative philanthropy and fellows, began to reflect on the initiative’s inaugural year.
“There was always a concern that if a project wasn’t funded, there would be a stigma attached to it, but we found that wasn’t the case,” she said, noting that high-net-worth donors, many of whom were operating through family foundations, supported the competitions’ applicants. She and the team also recognized that many projects could have significant impact with multiyear grants in the $10 million to $20 million range — a lot of money, but far less than the 100&Change prize.
In response, MacArthur rolled out Lever for Change in 2019. It’s a nonprofit affiliated with the foundation that holds open competitions funded and conceived by outside donors, with prizes ranging from $10 million to $100 million. Backed by MacArthur, MacKenzie Scott, the Bill & Melinda Gates Foundation and LinkedIn cofounder Reid Hoffman, it has built up the infrastructure to support 11 donor challenges, rolled out a database of promising proposals called the Bold Solutions Network, and helped move over $1 billion out the door.
While there was already an abundance of high-dollar philanthropic competitions out there, Lever for Change has systematically worked to scale up the practice in a way that would draw in more donors and lift up more ideas. It’s also sought to assuage common concerns about such prizes — that they feed into power imbalances and waste the time of the vast majority who do not win. Key to the platform’s approach is a more collaborative process and the idea that even those that don’t take home a prize can still find funding.
For Conrad, who also serves as Lever for Change’s CEO, the initiative’s data-centric approach has encouraged foundations, government funders and wealthy donors — known for being risk-averse when it comes to giving out their money — to open their checkbooks and accelerate social change. “Donors will go through a rigorous process where they feel fairly confident that there’s going to be an impact that makes a big difference in people’s lives,” Conrad told me.
That said, she’s also learned that when you’re trying to tackle problems like racial equity, gender equality and climate change, some things still can’t be neatly plugged into a spreadsheet. “We encourage donors to be comfortable with some of the fuzziness of the nonprofit sector,” she said. “It’s necessary if you want to address some of the problems that we’re facing.”
How Lever for Change works
Conrad and her staff kickstart the process by sitting down with donors to determine their interest areas. In many instances, the donor may have only a broad idea in mind, like economic opportunity or global health, prompting the Lever for Change team to ask more probing questions. “Are they interested in direct service? Are they interested in systems change?” Conrad said. “Projects that will have long-term sustainability? Something that’s innovative or something that’s well-tested?”
Next, they flesh out the project and lay out its application parameters, drawing inspiration from 100&Change’s application process, which, according to an applicant survey, had the proper level of documentation and provided valuable feedback.
Once the challenge is announced, applications move through a review process that includes an evaluation panel made up of individuals from academia and the nonprofit world, and a participatory review conducted by individuals at organizations working in similar sectors and locations. Applicants “enjoy getting to hear what other organizations engaged in a similar space are doing, and it sometimes has led them to reach out later to talk about collaborations,” Conrad said.
The Lever for Change team provides feedback gleaned from these panels to applicants and to the donor(s), who choose anywhere between five to 10 finalists, who, in turn, work with coaches to revise their proposals. This stage usually takes three to four weeks, although the W. K. Kellogg Foundation gave finalist organizations a one-year, $1 million planning grant to spend revising their proposals for its Racial Equity 2030 challenge. Upon reviewing the revised proposals, the donor(s) picks the winners. (Click here for a more thorough description of the challenge process.)
The most recent challenge was the LEGO Foundation’s “Build a World of Play Challenge” aimed at funding solutions focused on early childhood development. Last December, the foundation announced $117 million in funding to five awardees.
Building out a “secondary market” for funding
Critics of philanthropic competitions sometimes point to a “Hunger Games”-like dynamic that pits organizations against each other. Others lament the fact that in some competitions, only one organization receives funding at the end of a long and resource-intensive process. Conrad said her experience with 100&Change and Lever for Change runs counter to these arguments.
First, she found that large multiyear grants can promote collaboration between organizations since their leaders have peace of mind knowing that funding won’t be cut off after a year. Meanwhile, the LEGO Foundation challenge, which supported five awardees, showed that Lever for Change funders will happily cut checks to multiple organizations. The two previous challenges — the multifunder Stronger Democracy Award and W.K. Kellogg Foundation’s Racial Equity 2030 challenge — gave grants to three and five awardees, respectively.
But a big part of Lever for Change’s rationale is that competitions invite additional support for those that do not win — the Bold Solutions Network allows donors to easily fund organizations that didn’t come away with a prize. Of the $1 billion Lever for Change has helped to disburse over the last four years, 58% was characterized as “secondary market” funding, coming from donors outside of the challenge cycle, versus 42% from the donors overseeing the challenges.
Potential donors looking for new grantees can even ring up Conrad for a recommendation. “A donor can come to us and say, ‘I’m interested in what you have on early childhood intervention in the U.S.,’ so we go through our database,” she said. “Donors or their representatives can self-serve, or we can give them more information and find good fits for them if they need it.”
At the organizational level, leaders will often take feedback from competition panelists to craft more effective pitches to donors. “They’ll sometimes credit us with funding that they have gotten, even if we didn’t directly make the connection,” Conrad said.
When I asked Conrad what the organization has learned over the past four years, she mentioned two challenges: educating donors about Lever for Change’s unique model and overcoming the perception that competitions are not equitable.
Conrad noted that Lever for Change issues an open call for applications — unlike most foundations, which do not accept unsolicited proposals — and has “built challenges where there’s a specific focus on community-led organizations, with a particular focus on equity and inclusion,” citing W.K. Kellogg’s Racial Equity 2030 initiative. (Back when the Kellogg initiative launched, Edward W. Hazen Foundation CEO Lori Bezahler wrote an opinion piece criticizing the competition. Conrad later penned a guest post for IP in defense of prize philanthropy.)
She’s also accumulated some powerful insights into what makes Lever for Change’s high-net-worth donors tick. These individuals, many of whom are overworked and accumulating their wealth in real time, have a tendency to be risk-averse out of fear that they’ll “make a mistake.” Her observation may sound familiar. In 2021, I spoke with Alexa Cortés Culwell, cofounder of the of San Mateo-based strategic advisory firm Open Impact, and she mentioned the many Silicon Valley donors who hit the pause button on their giving so they could get a handle on their burgeoning wealth and develop an impactful philanthropic strategy.
When donors do open the checkbook, it’s often for their old standbys, like gifts to colleges and universities earmarked for new buildings and scholarships. “I think there is an appeal for things that are tangible or easily quantifiable in a fairly short time frame,” Conrad said. “But some of the important problems require bigger, long-term investments.”
This is where Lever for Change’s outcomes-driven approach has resonated with empirically minded donors, she said. Applicants must lay out specific milestones and explain how they’re going to measure them and report back to donors accordingly. If the organization’s leaders hit a roadblock, Lever for Change staff will step in to get them back on track. In that sense, Lever for Change is more like a philanthropy consultant, using the enticing hook of a prize to bring in donors and a bunch of data to ease their concerns.
At the same time, Conrad and her team are careful not to inundate time-constrained donors with mountains of data. “We’re constantly finding ways to communicate with them effectively and concisely,” she said, while noting that many donors “want to engage and figure out ways they can help beyond their financing alone,” such as providing in-kind services or networking connections.
The Lever for Change team is currently managing the evaluation process for the $10 million Maternal & Infant Health Award. Launched in March of 2022, the award, which is sponsored by the Patchwork Collective, aims to improve maternal and infant health outcomes around the world. Finalists will be announced in the Spring of 2023.
Around that time, Lever for Change will launch an open call for a new challenge. (“I can’t say a lot about it, but stay tuned,” Conrad said.) Beyond that, she and her team are combing through Lever for Change’s robust and ever-growing database to identify issue gaps and determine whether subsequent challenges can address them. “Those sorts of ideas will be coming forth,” she said, “and we’ll be more proactive about finding donors who might be interested in them.”