The shift from several small grants to a few big ones could make failure easier to accept

If funders want to make a big impact, they need to make big bets. MacArthur Foundation is putting $100 million on the table.

A single table.

Earlier this month, the foundation announced a competition that will award $100 million to one big idea looking to solve a “critical problem.” Traditionally, foundations and donors have split big sums amongst a number of grantees.

Take the $8.5 million grant Pew made toward 45 Philadelphia organizations fighting childhood poverty earlier this year, or the Knight Cities Challenge, which awarded $5 million to 37 organizations.

That funding paradigm — making several small investments over a few large investments — is beginning to shift. That could lead to more acceptance around the concept of failure in philanthropy, according to a recent report from NPR.

“If you make hundreds of small gifts, they’re all good. Everyone appreciates it. And it’s very hard to see success from failure,” William Foster, a partner at The Bridgespan Group, recently told NPR. “But going out and doing big things with a goal of change, of solving things, you expose yourself to failure.”

In Philadelphia, we’re beginning to see more players in the social impact space accept the idea of failure as a positive and productive learning experience. This trend of funding fewer organizations at larger amounts begs the question: What would the failure of a single big grant project mean for those who rely on services from organizations left unfunded?