In his recent book, Strategic Giving: The Art and Science of Philanthropy, Peter Frumkin notes that every foundation employs a repertoire of tactics by which it makes grants that fulfill its mission and obligations. Taken together, the tactical repertoire of a foundation reflects its “theory of change”—its particular framework for creating impact.
Frumkin lists “ten prominent grantmaking tactics that at various times held out great promise for improving the ability of foundations to achieve change and impact. . . . Each of these tactics focuses on the grantmaking process, not the kind of program that is being supported.” The ten grantmaking tactics donors most often employ for exerting leverage are:
- Project grants (as distinct from general operating grants)
- Short-term grants (“get in and get out”)
- Matching or challenge grants
- Loans and program-related investments (not grants)
- Large grants (significant resources for selected initiatives)
- Grants driven by proactive RFPs
- High engagement grantmaking (donor involvement)
- Overseas funding
- Joint funding
- Technical assistance, planning, and capacity building grants
Leveraging tactics influence both the grantee and the grantor. Leveraging tactics, including challenge grants, extend and deepen grantmaking impact by encouraging grant recipients to carry out their business in new or different ways. These tactics can have dual impact. First, they can influence how organizations operate. Second, they can influence the programs grantees offer. In terms of the grantor, leveraging tactics enable foundations to enhance their impact using limited financial resources. (See Frumkin, Chapter 6)