Leverage: Why This Silicon Valley Funder Is Doubling Down on a Beltway Think Tank

A while back, we described the Center for Global Development as "the premier policy shop working to reduce global poverty." The Washington-based think tank was founded in 2001 by Ed Scott, a tech winner who we once called "Silicon Valley's most effective global giver."

What made Scott so special among the various tech donors who've come into the global anti-poverty space in recent years is that he focused on influencing the actions of national governments and international agencies—entities that have exponentially greater resources for aiding the poor than private philanthropists. Additionally, decisions made in places like Washington and other national capitals on issues like trade and immigration can powerfully shape opportunity in developing countries. All of this means that funders who successfully invest in shaping policy can get much more bang for the buck than funders who focus downstream—and often find themselves dealing with the symptoms of bad policy. 

Since its founding, CGD has sought to pull every possible lever to promote policies that benefit the world's poorest people, and it's had some big wins along the way. Ed Scott gave millions to the organization. And when he retired as board chair in 2014, we wondered if a new sugar daddy would eventually step forward to support CGD at a major level.

Related: More Bang for the Wonk: How the Center for Global Development Leverages Donor Dollars

That's the backstory for the news that the Open Philanthropy Project—a grantmaking organization mainly backed by Good Ventures, the foundation started by Facebook billionaire Dustin Moskovitz and his wife Cari Tuna—recently awarded CGD a $3 million, unrestricted, general operating support grant. Good Ventures has previously supported CGD, but this is its biggest grant yet to the organization.

Good Ventures is a young foundation and very much a work in progress, but its grants have grown bigger and bolder lately, and it's given its largest chunks of money for global work. Meanwhile, the Open Philanthropy Project, which it created with GiveWell, is now emerging as a key funding vehicle for Good Ventures, which doesn't itself have any staff. Keep an eye on this outfit, which Good Ventures President Cari Tuna tells us is scaling up to engage in "increased grantmaking in our areas of focus." Its snazzy new website explains what those areas are, and it's quite a range, including a number of U.S. policy issues.

Last year, we wrote about Good Ventures' $25 million grant to GiveDirectly, which engages in direct cash transfers to Africa's poor, and more recently, we wrote about its several jumbo-sized grants for global health. It's no wonder that the dollar signs are getting bigger, since there is a $10 billion fortune behind Good Ventures, and the foundation has pledged to move larger sums as it gains confidence.

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Think tanks are clearly an interest of Good Ventures. Aside from backing CGD, last year, the foundation gave support for overseas think tank work. 

Related: A New Direction for Good Ventures: Supporting Think Tanks Overseas

If you want to know why Good Ventures and the Open Philanthropy Project are betting so heavily on CGD, you can read the thinking here. The analysis says that “there have been multiple occasions in which CGD’s work had a causal impact on decisions involving billions of dollars aimed at helping the global poor.” It noted that while it’s difficult to measure the impact of “CGD’s involvement through clear humanitarian outcomes,” in the end, the team “guessed that it had a positive impact many times its total spending.”

Note the modest leap of faith required in making a big investment in CGD. In fact, it can often be hard to nail down the direct effects that think tanks have on people's lives, which is why many funders steer away from the more ethereal realm of policy work and give money to groups working in the field. It takes a more sophisticated funder to grasp the crucial importance of swaying high-level policy debates.

All that said, the vast bulk of Good Ventures global funding is still going to front-line efforts to save or improve lives in poor countries. It will be interesting to see just how far it and the Open Philanthropy Project will go in helping CGD and other think tanks sway a range of policies with highly negative effects on the global poor—from ill-designed foreign assistance programs to tariffs on imports like sugar and cotton that deny poor countries opportunities in global markets.

If Good Ventures is as strategic as it seems, our bet is that bigger bucks will flow to the high-leverage sphere of public policy work.