Taking Risks and Learning From Mistakes

Philanthropy is often described as society’s “risk capital.” Our generosity can support causes and ideas that business and government agencies cannot or will not. We can use our resources to inspire new ideas, challenge existing thinking, or continue supporting an organization when others won’t.

There was a time not too long ago when you rarely heard the word “foundation” and “risk” in the same sentence…or paragraph…or entire document. Risk simply hasn’t been something formally and broadly associated with philanthropy over the past few decades.

As I sit here writing about risk, the date at the bottom of my laptop screen – September 11 – is a jarring reminder that risk analysis is both futile and indispensable. It’s futile if we use risk analysis to predict the future. Or come to believe that the act…

Many of us in family philanthropy are driven by a grand vision of a better world. We are motivated by bold ideas, and finding ways to use our philanthropy to make a difference and leave a lasting impact. And, at the same time, we are too often hamstrung by a…

A sure-fire indicator that we all make mistakes was the capacity crowd at the National Forum on Family Philanthropy workshop in Seattle entitled, “The Best Mistakes We Ever Made.” Using a rapid-fire format, each of ten speakers took three minutes to share a mistake they made in their family philanthropy…

Nonprofit consultant Beth Kanter’s blog features posts about nonprofits, funders, and associations learning from failure.

This document, developed by Fail Forward, is intended to support organizations who are interested in documenting and learning from their failures, and using the process as a launch point for organizational change. It is largely based on the process developed by Engineers Without Borders Canada (EWB), an organization which has…

An annotated framework of the five most common types of risk, adapted from the NCFP Passages Issue Brief, Expanding your comfort zone: A window into risk in family philanthropy.

Five questions about risk that every foundation leader should ask, prepared by the Open Road Alliance.

In April 2011, a group of staff from the NYSHealth Foundation met and considered the topic of risk taking in their grantmaking. This checklist was developed for staff to more systematically assess the potential level of risk when evaluating a proposal or project. To learn more about tht thinking behind…

Those charged with finding or funding solutions to social challenges — philanthropists, government, nonprofits — seem to be moving too slowly and often operating with the same set of tools, concepts and caution of the generations before us. To tackle today's big and ever-changing social challenges, we have to Be Fearless.

A step-by-step guide from the Case Foundation for leaders and organizations that want to be fearless and create transformative change. Inside, you'll find assessment tools, ideas and discussion prompts specially designed for social sector changemakers like you who want to make a greater impact.

On the eve of its 100th anniversary, the Surdna Foundation is stronger, more nimble and more effective as a philanthropic organization than it has ever been. The secret to its success? Stakeholders who encourage failing forward, experimenting with new ideas and collaborating with others

Whatever the catastrophe, Open Road Alliance (ORA) stands ready to help, able to offer grants of up to $100,000—with decisions made within two to six weeks of applying. Their average grant is $76,000 and, since 2012, it has awarded $3.5 million to groups including the Global Press Institute and the…

An abandoned lot, an experimental initial public offering (IPO) and a culture that believes that failure leads to learning inspired the Jacobs Family Foundation to transform its business model from traditional grantmaker to place-based funder to maximize impact without sacrificing its core values and mission. A Be Fearless case study,…

Effective philanthropy is a learning process that develops through experimentation. To be successful, we must take risks, support new ideas, acknowledge our mistakes, share experiences, and learn from one another.

Understanding decision-making patterns is the first step toward improving them. We know that despite best efforts to act rationally, human tendencies to avoid risk and loss while seeking certainty and gain can impact sensible decision-making. Research has demonstrated this phenomenon across many facets of our society—including finance, consumer products, and…

Cognitive traps can hinder any decision a foundation makes about its strategies. This includes how to construct a theory of change to address it, and which grantees are best suited to do the work. It also includes decisions made during implementation, such as whether strategy adjustments are needed or whether…

To help both grantmakers and NGOs better identify, assess, mitigate, and plan for risk in their portfolios, Open Road Alliance offers this framework for evaluating risk. This brief framework is designed to provide grantmakers and NGOs with tools to conceptualize and describe risk and its implications within the scope of…

Scenario and contingency planning help nonprofit leaders plan for and react to opportunities and challenges that may arise over a given time frame. They enable nonprofits to ask and answer the question, "What would we do if…?" for a variety of circumstances, taking time to consider strategic implications, identify and…