Converting Funder Collaboration into Collective Impact
A new report shares findings on the impact of funder collaboratives in Northeast Ohio and offers tactical suggestions for other regions interested in sparking economic growth.
The premise of stronger collaboration producing “collective impact” has become a rallying cry for many social sector organizations seeking to address complex economic and civic issues. Funders and nonprofits have increasingly accepted the importance of shared strategies and coordinated actions as conventional wisdom, and the dilemma has shifted from whether to collaborate to how to do so effectively. Though the Stanford Social Innovation Review has profiled the work of the Strive educational initiative and other collaborations, there is scant empirical evidence that demonstrates how collective impact strategies outpace what organizations can accomplish alone. Simply put, collaboration is alluring in theory and messy in practice.
The Fund for Our Economic Future has been working its way through the highs and lows of funder collaboration for nearly a decade as we’ve sought to advance economic opportunity for Northeast Ohio. It hasn’t been an easy process, but our experience and accomplishments have confirmed the value of partnership. Fund-supported networks generated an estimated 14,543 jobs and $518 million in payroll, and raised $2.87 billion in capital. Fund efforts have also created a greater sense of regional identity among residents and institutions in Northeast Ohio. After more than a half-century of decline, our region is on the way back.
While no magical formulas exist for developing an effective funder collaborative, we believe that every collaboration produces constructive lessons. A recent report sums up what we’ve learned during the Fund’s first seven years. Titled “Catalyzing Regional Economic Transformation,” it translates findings from a 2012 assessment of the Fund’s work into tactical suggestions for others. A few important lessons include:
- 1. Harness the power of research. Collaboratives often struggle with forming a consensus around common strategies and approaches; many institutions join collaboratives to have a seat at the table and work alongside other organizations, but they bring a diverse and occasionally competing set of views., Research and data analysis have helped the Fund forge consensus around how to prioritize its efforts, build a common agenda and make a compelling case for action to others.
- 2. Incentivize collaboration through the promise of outside funding. Organizations frequently deepen and sustain relationships by partnering to apply for federal and state funding. The Fund has pursued those opportunities with its grantee partners, leveraging more than $130 million in government support. More importantly, it has fostered new networks and coalitions.
- 3. Capitalize and shape the work of intermediaries (i.e. build frameworks). To develop the collaborations needed to achieve collective impact, philanthropy must engage in roles well beyond grantmaking. It requires a tolerance for funding—and holding accountable—the “overhead” of managing networks.
- 4. Attract private sector partners to execute the strategy. Philanthropy cannot go it alone, and it’s not enough to have the private sector “inform” the strategy. Businesses and private sector interests need to commit to the strategy over the long haul. This includes identifying common interests, formally committing resources and sharing management responsibilities for executing the strategy with social sector organizations.
Perhaps the biggest impact of collaboration comes not from deepening impact, but extending its arc. The Fund began with 28 funders contributing $30 million in 2004; nearly a decade later, more than 100 foundations, organizations, and institutions have participated and deployed more than $90 million in capital. Annual philanthropic giving for economic development in Northeast Ohio in 2011 had increased by more than 150 percent since the Fund’s inception, and, most tellingly, several funders indicated that they never previously invested in economic development; they decided to do so only because of the Fund. That’s real collective impact.