Trust between funders and nonprofits is hard to establish.
Power dynamics frequently get in the way. That’s why Social Venture Partners gives multi-year grants. Building trust takes time, and change doesn’t occur without trust.
We ask a lot of the nonprofits we partner with. We ask them to show us where they’re weak – where they need help. It’s not usually the side you show a funder. But when we finally have that conversation – that’s when we all know we’re getting somewhere.
Trust also allows us to get out of the way when we’re not needed. SVP is not in the business of telling nonprofits what their mission should be, or what their programs should focus on. They’re the experts. Likewise, they know where they need to spend their money.
Most grants nonprofits receive are restricted. Nonprofits have to spend the funds on specific programs (e.g. providing backpacks for students in need). They can only use a small percentage (if any) to cover their “overhead,” which can include anything from rent to the administrative assistant’s salary.
We believe that this distinction is unnecessary and hamstrings nonprofits. (And we’re not alone on this.)
What impact is the organization having on our community? Can they demonstrate it? Have we built a relationship on a foundation of mutual trust? These are the questions we focus on. If the answers are solid, where they spend their grant dollars is irrelevant.