Drivers of participatory grant making

Participatory grant making [PGM] seems to be one of the next big things to emerge in the funding scene in the UK. There is however a danger that it could become a flash in the pan or a bit of a buzzword. It is important to understand that, although funders up and down the country are beginning to trial PGM approaches, they are not coming from a radical place, with many still using quite traditional funding models. Usually, they put out a call for proposals, then receive written applications which the funding staff read and assess and put forward for decision. Where a grant is awarded, the grantee is then expected to report on proposed indicators/outcomes. This is a process that has existed for years so, why are funders who have worked in much the same way for decades, now starting to explore alternative approaches?

I think is a combination of external and internal drivers which have helped to catalyse PGM. A changing world and societal pressures are coming up against the traditional working models of many foundations.

However, before undertaking PGM, it is important to acknowledge and be honest about the drivers that are involved. This is necessary because there are so many models and ways of approaching PGM, and a good understanding of the drivers will help foundations to make informed choices regarding appropriate models, methodologies and evaluation techniques. It will also help to get buy-in from Boards and Senior Managers.

Some of the drivers that should be considered are listed below — I don’t believe the list is exhaustive but is a starter for 10.

External Drivers

The societal context within which foundations are working — public pressure and perceptions of wealth distribution — are pushing foundations to explore alternative funding approaches.

Disenfranchisement — Communities feel locked out of decision making and ignored by those in power. Within the UK we can’t escape the fact that large swathes of the population voted for Brexit because they perceived (rightly or wrongly) that decisions about them, their community and their country were being made behind closed doors and in a different country. There are several approaches that might counter the impacts of feeling disenfranchised.

• Community votes/participatory budgeting events. Having PGM methodologies that make the process as open and transparent as possible might help to alleviate these tensions. Community votes/participatory budgeting events where communities can see who has applied, how much they are asking for, what they want to do with the money and to also have an input into the decisions that are made
• Crowdfunding approaches is a more circular approach to philanthropy, where people can choose directly who they want to give their money to. This can be match-funded by foundations to support the sorts of projects, ideas and organisations that are able to speak to and encourage donations from a community

Responding to critics of philanthropy — Philanthropy can be criticised for a range of things — one of these being the accumulation of wealth through investment in morally dubious activities both within historic and current practice. Exploitation of resources and wealth inequality are often perpetuated through these practices and this has been a prevalent conversation in the USA — particularly with the release of the book ‘Decolonising Wealth’ by Edgar Villanueva. This is a conversation which is beginning to bubble here in the UK. Some examples of how funders could respond to these criticisms:

• This isn’t PGM but Foundations should be honest and open about how they accrue their wealth and seek to re-align investments with the values of the communities they are looking to serve.
• North Star Fund uses an interesting model that devolves power to communities whilst at the same time tackling entrenched wealth inequality. This approach isn’t necessarily about funding new organisations but instead is about the learning and change that comes from being involved in the process. Their giving circles bring together high net worth individuals with activists to learn about systemic inequality and to challenge and learn about how and where wealth is distributed.

Transparency of philanthropy — There is a lack of transparency as to where and how money is spent in philanthropy. PGM models that enable communities and the public to see where money has been spent, and on what, can help to build this transparency and trust. PGM can be used to increase a foundations transparency by:

• Ensuring that through PGM approaches there is a feedback loop. We are informing communities who we have funded and how we have done it.
• Community votes/participatory budgeting events — allow communities to see everyone who had applied and for how much. The process of a public vote is open to scrutiny and allows people to understand and engage in the decision-making process
• Crowdfunding approaches — enable community to see online in real time how money is being distributed. Foundations can provide funding support to ideas that communities are willing to fund out of their own pockets.

Increasing diversity — Discussions regarding the lack of diversity among decision makers and leaders across civil society is ongoing as a result the sector is becoming more aware of biases in decision making processes and there is also a recognition that with a variety of people around the table, we are more likely to develop diverse solutions. Movements in the UK such as #CharitySoWhite have applied pressure to recognise and act on this issue.

• Using models of PGM to fund specific issues or areas that would usually come up against barriers in more traditional funding models. There are lots of examples of where PGM programmes have concentrated on a specific demographic, issue or community. For example, The Other Foundation focuses on LGBT rights, The Disability Rights Fund, With and For Girls, Novo’s Girls First Fund, Boston Foundation’s Equality Fund, Pawanka Fund for indigenous communities — the list goes on.
• There are a range of PGM models that can be used to support these programmes e.g. representative models, community boards, rolling collective models, open collective models, direct transfers or crowdfunding. All of these directs money into communities and provide funders with the opportunity to learn and to improve their knowledge, understanding and practice.

Internal Drivers

As well as the above drivers from outside a foundation it is likely that there are also drivers from within (board, senior management team, donors or strategy) that could encourage a move towards PGM. These could include but are not limited to:

Supporting the good stuff not the good bid writers — Doing the same thing, in the same way for decades has not brought about long-term systemic changes for some of the most entrenched social problems. If we want to find new solutions closest to communities, we need to find ways to move resources into their hands. Funders are starting to recognise that people and organisations that are good at improving the lives of others may not necessarily be good at completing funding applications. So, finding new ways of moving resources to these people is necessary.

• Nearly all PGM models can offer this opportunity but in order to achieve this they need to be designed with the community they are seeking to support.
• These models allow the communities who experience the issue to feed in their expertise in order to provide money to the most impactful organisations and projects.
• RSF Social Finance uses a gifting circle model where a group of nominated organisations share a pot of funding to deliver their work. The organisations all write applications detailing how much of the pot they want. This collective then work together to decide the breakdown of the grants. Applicants write their applications for their peers rather than for a funder. This allows them to negotiate, and in some cases drop their asks, so that others in the group can also be funded.
• Using simple and flexible options to apply, including video, conversations, recycling of applications etc, can be a way to fund organisations doing good work rather, than funding good bids.

Devolving power to communities — some foundations recognise that communities can have the answers to the challenges they face and providing them with the decision-making power over the solutions to these problems is an important step towards making good and strong grant making decisions.

• All PGM approaches provide opportunities for this but, if devolving power is the key driver, then as you design the approach you must always ask: ‘Why am I doing it this way? How does it remove barriers?’ ‘Where does the power lie and how can I give it up?’
• This is particularly important when it comes to things like: Who makes the decisions? Who decides who makes the decisions — does the foundation choose or is it an open process? Who can and can’t apply and who chooses who decides this?

The awakening of Funders to movements — The world is changing, we are facing some of the biggest challenges and as we look towards people-power and movements to find solutions, we are recognising that traditional ways of funding will not allow us to support and move with them. Movements are often un-constituted and non-hierarchical.

• Direct transfer enables them to get on and do the work. A community or an individual can use the money as and when they see fit, with no need for application, monitoring or reporting.
• The Edge Fund in the UK use a collective decision-making model. All applicants are invited to present to each other through short pitches, short written overviews and talking to each other over the course of a day. At the end of the day all applicants then vote on which organisations they feel should be in receipt of the funding.

Improving practice — Learn from different approaches/models in order to understand the barriers in our funding processes, and what would help to remove these barriers. We can apply learning from PGM to help inform our funding decisions across the whole organisation.

• All PGM models provide the opportunity to learn about communities. We just need to ensure we are building in evaluation approaches that capture learning from all the conversations, decisions and grants. Together with the ability and resources to share this learning in a way that can impact change.

Improve Funder knowledge — Help staff understand the main concerns of a geographical area or an issue, what they would want to fund, what they deem important or not, to help strengthen foundation staffs understanding of their experiences. This can then help us improve decision making across an organisation. It can help us test an area of work to understand if this is something we want to explore further.

• All PGM models provide the opportunity to learn about communities. By thinking about learning as a driver for this work we can embed processes that allow us to do this from the outset. We can use participatory approaches with communities to understand what is important for funders, grant holders and applicants to know and use this order design our evaluations around this.

Improve staff skills — PGM involves a different skills-set to that of traditional grant making. This includes events management, facilitation, active listening, user design and relationship building — all things that help us become better grant makers across the board

• All PGM models provide learning and development opportunities. This might vary depending on the model being used e.g. a community vote with hundreds of attendees might require more event management skills. Whereas, a PGM model with more collective deliberation might require more developed facilitation skills to keep it on track. Developing a PGM approach gives staff the opportunity to learn these skills.

Strengthen the sector — By providing an opportunity for organisations to see how grant discussions and decisions are made, the knowledge and insight gained can help improve both their relationships with funders and the quality of future applications as they are more aware and understanding of what is needed in order to make a good decision. PGM models that involve some form of collective discussion and deliberation are more likely to provide insights to those involved about what makes a good or bad funding application.

• The Other Foundation use a community board model where LGBTQI peer reviewers assess and make decisions on the grants being made.
• Camden Giving also uses a peer reviewer process and provides follow up training for the reviewers so that they can reflect on and learn from the experience they’ve had. They support them to understand how they can communicate what they have learnt and achieved through the process so that they can reflect this on their CV.

Fund areas and communities we have struggled to fund in the past — We can use participatory approaches to raise our profile in areas where we have struggled to fund. PGM enables us to build relationships which could lead to communities moving from micro-grants to applying for larger grants by allowing them to demonstrate they can manage a grant and to build their confidence.

• Community votes or community panels are a good way to enable people to access funding without an arduous process. If you can deliver micro-grants to un-constituted groups, it is a good way to help communities to build relationships with funders and to go on to apply for larger pots of funding.
• This has been particularly impactful at the National Lottery Community Fund. Jaywick was an area that was missing out on funding opportunities but through a community panel and micro-grants, the Fund was able to support good work in the local community and then develop relationships in the area which then allowed groups to apply for our smaller funding pots.

Achieve some of the sectors diversity, equality & inclusion ambitions — We can use PGM to support increasing our funding for communities of identity as well as improving our understanding of the issues impacting them.

• By devolving decision making out to the communities we are aiming to fund, we remove a layer of bias that might exist in our own organisations
• It provides a closer connection to marginalised communities. PGM becomes an opportunity to not only learn and understand the issues of importance, best practice and the barriers to best practice, but it also helps to put money into communities that might otherwise be overlooked or missed out. It helps to develop networks to create well informed approaches, decisions and solutions.
• PGM models such as rolling collective, open collective, closed collective and community boards can all help in providing useful insights and understanding.
• There are many examples of funders working in this way — The Other Foundation supports LGBTQI communities, With and For Girls, Disability Rights Fund and Pawanka which supports indigenous communities.

Build trust, relationship and transparency — PGM is a great way to build trust with communities, as they are able to understand how we make decisions and can see who else is asking for funding. It also gives them the chance to get to know us as an organisation (and people) better.

• All PGM approaches build this trust and transparency. Community votes are perhaps the most transparent as everything is open and observable
• Other approaches that use collective decision making also ask that you are honest about what you can and can’t do and what’s on the table. But this information is often only available to those in the room (unless you actively publish discussion and decisions and an individual actively seeks it out). Wikimedia publish their online funding discussions and decisions which are conducted through wiki and so they are accessible to those who want to view them

Increase a foundations profile and reputation — doing PGM gets your name out there. It can enable a fund to increase its presence and profile within a community and can link their name to the good work they are doing. PGM can also be help more people access funding as it offers funders the opportunity to start developing relationships and advertising other funding opportunities they might have.

• Community votes are a great way to increase the profile of a foundation
• The National Lottery Community Fund runs the People’s Projects a collaborative project with ITV news. The project enables the public to vote on which project they would like to see receive money from the Fund and this helps to increase awareness of the Fund, the good causes it supports and enables other organisations to know that we are open to funding groups that are doing a range of activities.

Being clear about what is driving your use of PGM enables you to design and utilise an approach to support your objective. It enables you to understand what good looks like and can help you evaluate whether you are achieving your objectives. When working in this way, being aware of the true drivers behind your work can also help in getting the buy-in of your board and senior management.