How the New Education Funders Are Different: A Scholar's View

Much contemporary education philanthropy follows an approach known as "venture philanthropy," in which funders seek to maximize returns on their investments, measured in social and educational change. Under this approach, such funders generally steer dollars toward policy advocacy groups and charter school operators that describe themselves as disruptors that force changes in the education status quo.

Is it possible that the funders who favor these types of players in the education landscape—foundations such as Walton, Gates, and Broad—are themselves disruptive forces that have changed the face of K-12 funding, forcing older, long-established funders such as Ford and Carnegie to alter their grantmaking activities? Jeffrey Snyder, an education poicy scholar at Michigan State University, raised this question and examined grantmaking patterns by "old" and "new" funders in a paper presented at an American Enterprise Institute conference on education philanthropy.

Snyder compared funding activities by 10 foundations between 2000 and 2010, dividing the funders into "old" and "new" foundations. For Snyder, "new" funders are those foundations that were established in the 1990s and began making their marks on K-12 funding in the 2000s. Gates, Broad, Walton, Dell, and Robertson are the new funders in Snyder's study, while Annenberg, Ford, Carnegie, Kellogg, and Wallace are the "old" funders. 

Snyder found that "old" and "new" funders differ in the types of organizations they fund, as well as the range of activities and priorities supported. Older, more established funders were more likely to focus on building capacity in traditional education systems, directing their grants toward universities and nonprofits that work directly with school districts.

New funders, in contrast, were more concentrated in their grantmaking, funding similar issues and often supporting the same sets of recipients that pursue these priorities. Teach For America is a good example of an organization favored by these "new" funders. TFA has established an alternative to university-based teacher preparation programs by providing a new pipeline for teachers. Many charter school teachers and administrators, as well as an increasing number of teachers in traditional K-12 systems, TFA interns and alumni. TFA's supporters include many of the "new" funders in Snyder's study. Walton, Broad and the Laura and John Arnold Foundation (another "new" funder, by Snyder's standard) are especially enthusiastic in their support of this organization.

To be fair, however, so-called "old" foundations have taken notice of TFA and other disruptive forces in K-12 education. Carnegie in particular has been a strong supporter of TFA, making some $7 million in grants going back to 1990. Kellogg has also given substantial funds. Prominent charter school operators such as Green Dot and KIPP list older foundations such as Wallace, Kellogg, and Carnegie as supporters—albeit at lower levels than the amounts given by Walton or Broad.

Snyder's study examines grantmaking activities only through 2010 and thus does not address any trends or patterns in funding beyond that period. However, his larger points are important. The broader giving by older foundations contrasts with the more concentrated grantmaking of the newer foundations, which also command greater financial resources than their more established counterparts. Newer foundations also concentrate their funding among a smaller group of players.

Snyder's findings help illustrate the challenges faced by nonprofits seeking to make their own impact on the education landscape. The concentrated grantmaking networks that exist among "new" foundations and their favored recipients can make it difficult for new nonprofits to get noticed. However, the broader grantmaking strategies of older funders pose separate challenges. In either case, the key for grantseekers is to employ a strategic approach that demonstrates small successes in their fields to funders.