The OpenGrants Theory of Change
The UN’s 2030 Agenda for Sustainable Development outlines 17 major goals for the world. If you are unfamiliar, you can review the agenda here https://sdgs.un.org/2030agenda.
As a uniquely risk-averse and impact-focused form of capital, grant funding will play a critical role in addressing these challenges.
Over two trillion dollars in grants and aid are deployed around the world every year, many of which are intended to support at least one, if not multiple SDG’s.
It is well documented that about 30% of grant funding and foreign aid https://drive.google.com/drive/folders/1i4m_5QRCo6sp1YqXLVflyKknyqau3KYU?usp=sharing never reaches its intended target. Many other grant programs struggle with similar waste and abuse.
This means that each year, 30% of two trillion ($600B USD) is misused or lost due to fraud, waste and abuse.
Additionally, a lack of equitable access to grant funding often results in poorly developed solutions or, in some cases, communities that never receive any solution at all.
Grant funding is critically important capital within a democratic society that funds humanitarian efforts, science & innovation, and economic development.
We cannot let it continue to flounder under a distribution ecosystem and infrastructure that promotes inefficiency and inequity. We must keep this capital operational and fully optimized at this critical moment in history.
We have seen the catalyzing power of capital when placed in the hands of people who have an effective solution in addition to the love and trust of their communities. We have also witnessed firsthand how no amount of capital can solve a lack of trust and understanding.
Grant giving must no longer be about the grantor. It must become about the work of the recipient.
With all of the aforementioned in mind, our approach to impact runs along the following key points. We believe that by fundamentally transforming the way grant funding is accessed, we can preserve democracy and accelerate progress toward the UN SDGs.
Outcomes driven from this change could look like this:
• Restoring standard levels of confidence in government in five years
• Curing cancer for everyone in a decade
• Solving climate change in the next 20 years
• Solving world hunger in the next 20 years
Making Grant Funding About The Recipient and The Work
Foundations, government, and other grant giving entities were never designed to support grant recipients. Deploying, administering and managing grant funding is something that these groups have learned to do out of necessity.
Foundations were designed as a tax haven and/or means of creating legacy for rich people (once again nothing to do with the grant recipient). Government was created to uphold law and order.
Neither of these entities were developed to deploy grants or support grant recipients with deep subject matter expertise and networks.
On the whole, it's fair to say that the government, foundations and other groups have done a good job deploying grants considering the tools and frameworks they were given. Grant giving itself is an incredibly altruistic act. Grantors should be applauded and lauded.
However, there is a better way to deploy grants and a better way to evaluate how effective, and therefore praiseworthy, any grant program is.
Let's start with an assumption that Grant making is a tool for deploying capital which is focused on creating some proscribed impact. How then should the grant making process be designed?
Assuming the goal is creating a highly proscriptive impact, then any grant making process should support a few things.
• First, as much funding as possible should be available for the creation of impact, with administrative waste minimized.
• Second, the desired impact should be easy to communicate and easy to understand, so that all parties are on the same page.
• Third, we know that diverse teams and ideas drive the best outcomes, so we need the process for connecting people to resources to be as inclusive as possible.
• Fourth, it should be easy for all parties to see how specific capital caused specific impacts.
OpenGrants has crafted purpose-built, modern infrastructure to accomplish this. Our platform acts as a powerful tool for both transactional and logistical efficiency, as well as a social network for unlocking access and resources in a way that has never been done before.
Programs like FastGrants and SBIR have just begun to scratch the surface of what we can achieve when we empower individual leaders and experts. Furthermore, evolving structures around community ownership have created powerful tools to deeply align incentives across stakeholders.
OpenGrants seeks to elevate and incentivize leaders, leveraging the OpenGrants platform to ensure that not only are we working towards the outcomes described, but that everyone creating value in this ecosystem is rewarded.