*This is part 2 in a three part series. Part 1 in case you missed it. *
We need to be more specific with what we call grant programs
A grant is “an amount of money given especially by the government to a person or organization for a special purpose” as per the Cambridge dictionary. The examples cited in the dictionary are “a student/research grant” or “a local authority/government grant”.
This brings up an interesting question on the nature of the giving, namely, is something specific expected in return? Especially with the two examples outlined above it would seem that yes, there is a clear expectation of something happening (though one can argue on the specifics of what is gotten in return vs making sure a specific activity happens as a result).
Someone gets a research grant to perform research, not to invest it for personal (loss or) gain. Likewise, a government grant is meant to go towards specific activities, such as small business grants to promote growth in small business.
So let’s take a step back and break down what I mean by a grant program. The components of a grant program as I see it are:
A funding entity (the granting organization)
Clarification of who qualifies for funding (frequently builders but can also be non-technical community members)
Clarification of the activities that qualified individuals/groups able to use the funds for (this really varies in prospective vs RFP based grant programs)
Clarification of purpose and why they fund what they fund (while some transparency is offered in specific programs, I would argue that theories of change pertaining to grant spend are lacking in the space)
To define these things, grant programs should have a specific goal in mind and should operate in the context of a larger mission.
It’s also helpful to think about two things that grant programs are NOT:
Bounties (giving funds for a clearly defined scope of work)
Marketing spend (aka fast money out of the door with no quality infrastructure or thoughts on impact measurement, purely for the sake of gaining publicity)
Let’s look at a few examples to make all of this more specific.
National Institutes of Health (NIH) in the US
The “NIH’s mission is to seek fundamental knowledge about the nature and behavior of living systems and the application of that knowledge to enhance health, lengthen life, and reduce illness and disability.” They have 4 clearly articulated goals and recognize that in order to achieve those goals, “the NIH provides leadership and direction to programs designed to improve the health of the Nation by conducting and supporting research”. They proceed to outline 5 areas of research that are most relevant to help them achieve their goal.
It seems as though NIH mainly has groups that coordinate on grant issuance and research, as well as policy and administrative functions that enable such work. Feel free to check out their organizational chart if you want some more color on how they’re structured.
Given that giving grants is a fundamental aspect of their operations, they do not seem to have a separate mission for their grant program.
To give a sense of size, the NIH gives out $32 billion a year “to enhance life, and reduce illness and disability”. Imagine having to effectively administer the issuance of that much capital on a regular basis. For comparison, the largest programs that we could find in web3 gave out hundreds of millions over multiple years.
The bureaucracy that exists starts becoming more understandable, especially if the administering organization wants to minimize the amount of fraud that takes place (we’ll be hearing more and more about the quantity of Paycheck Protection Program loans that went to personal gain and not to their mission. It’s also important to note that a goal with COVID funds was to get grants out quickly and moving quickly almost always leads to some people getting funds that shouldn’t have by the logic of the program, an issue that DAOs themselves are quite familiar with after the last bull run).
Let’s recap NIH:
A funding entity- NIH
Clarification of who - researchers
Clarification of the activities - research on health related matters
Clarification of purpose - “to enhance life, and reduce illness and disability”
Bill and Melinda Gates Foundation (BMGF)
The BMGF has a stated mission “to create a world where every person has the opportunity to live a healthy, productive life.” The organization 8 areas where their funds go, with Global Development and Global Health making up almost half of the $7bn the foundation issued in 2022. Within each of these areas, they outline program strategies and concrete areas of impact.
Let’s zoom into Global Health, specifically exploring their work around Malaria. They outline a clear goal: a world free of malaria. Related to this goal, they outline a goal-specific strategy, concrete areas of focus, an explanation of why they chose to focus on this domain, the specific individuals tasked with advancing on this goal within the foundation, and the partners they work with on this goal.
In total, the BMGF has issued over $58 billion in funding since 2000. To help them achieve this, they have developed a four step process developing grants to give out:
Concept development, which involves identifying ideas to support the organization's priorities,
Pre-proposal, which includes direct solicitation, discussions, and issuing Requests for Proposal (RFPs),
Investment development, which ranges from developing materials to make it easier for relevant individuals/groups to apply to pulling in the right experts to help review applications, and
Management and close, which entails working with the grantees while they work on their grant through the time they conclude the funded activities.
Let’s recap BMGF:
A funding entity- Bill and Melinda Gates Foundation (which runs programs across different impact domains of their choosing)
Clarification of who - specific to the project, a mix of researchers, builders, educators, and others as needed (they mostly clarify on the program level)
Clarification of the activities - defined on the program level
Clarification of purpose - defined on the program level
There are many grant programs out there, some of which have been around for decades and issued many millions or billions of dollars. I hope to get a follow-on project funded to do a more thorough exploration of non-web3 grant programs to learn more about what has and hasn’t worked there. But in lieu of that, let’s at least delve a little deeper into impact measurement and program evaluation.
If you want to read on, Part 3: Impact Measurement and Program Evaluations.
You can follow me on twitter for more grants related discussion.
Cover photo by Pixabay: https://www.pexels.com/photo/bills-capital-cash-cent-210679/