Intermediaries
/In simplest terms, an intermediary in the philanthropic sector is any organization that receives funds from multiple sources and redistributes money to other independent nonprofits. But most do a whole lot more than provide a transactional link between donors and grantees, and that’s why intermediaries are growing in number, prominence and influence.
Intermediaries take on a multitude of forms and functions. Community foundations are some of the oldest and most recognized intermediaries. But when people talk about grantmaking intermediaries, they are usually talking about organizations that host collaborative funds, assemble large special funds from the wider public and/or facilitate giving circles. Some intermediaries do those things and also fiscally sponsor nonprofit entities that don’t yet have their own 501(c)(3) status or are designed as short-term operations. Many intermediaries offer a combination of these things.
Basic types of intermediaries
The basic types described below are somewhat porous and overlapping; these are helpful categories to understand some of the lingo donors encounter.
Mission-driven generalist intermediaries. The Tides Foundation, an intermediary that moves resources to social justice movements, hosts donor-advised funds, “pooled” or “collaborative” funds, and offers grants management services to both individuals and foundations. Other examples are NEO Philanthropy, Proteus Fund, Solidaire Network and Borealis Philanthropy. Many of these examples are dedicated to progressive concerns, but mission-driven generalist intermediaries also exist for conservative donors, such as the National Christian Foundation and Donors Trust.
Subject-specific funds. While generalist intermediaries, community foundations and grantmaking public charities host or fiscally sponsor subject-specific funds, an increasing number of independent intermediaries are being established to focus on fairly specific issues. Examples include Southern Power Fund, Energy Foundation, Global Fund for Women, Restaurant Workers’ Community Foundation and American Journalism Project. Some of the newer, high-profile funds you might think fit in this category, like the Movement for Black Lives Fund, are actually hosted by generalist intermediaries (M4BL is hosted by Common Counsel Foundation).
Donor advisory services. These have a lot of overlap with generalist intermediaries but generally have a history of providing giving assistance to high-net-worth donors. Organizations like Rockefeller Philanthropy Advisors and Arabella Advisors have their core operations in facilitating the work of donors but have also taken on a lot of intermediary functions. For example, RPA hosts the Collaborative Fund for Women's Safety and Dignity. Arabella is the fiscal sponsor for the widely recognized New Venture Fund, as well as the Windward Fund, Sixteen Thirty Fund and Hopewell Fund.
Community foundations. Geographically focused community foundations are among the oldest publicly recognized intermediaries. Stalwarts like New York Community Trust not only have endowed funds from which they provide discretionary funding, they also manage donor-advised funds and frequently serve as hosts for specialty funds, like disaster relief funds or donor collaborative funds. Demographics-focused community foundations also fit in this category and include women’s foundations, Jewish funds, LGBTQ foundations and the like.
Other grantmaking public charities. These types have a lot in common with (and little technically different from) subject-specific funds, but are more commonly associated with longstanding social change work that do a lot of public fundraising. Examples include the Michael J. Fox Foundation for Parkinson’s Research, Living Cities, the Brain Behavior Research Foundation and United Way organizations. All of these collect funds from a variety of donor types and distribute grants to other nonprofits doing the kind of work those donors want to support but don’t necessarily have the time or expertise to seek out themselves.
Donor-advised fund managers. Donor-advised fund managers like Fidelity, Vanguard, Schwab and the National Philanthropic Trust have their giving entities set up as grantmaking public charities, but they are pretty hands-off compared to the intermediary types outlined above. Nonetheless, many in the sector refer to them as intermediaries and they do function as a midpoint between donors and nonprofits.
Why work with an intermediary?
A philanthropic intermediary links funders to the groups they fund. Intermediaries are usually more than just collectors of funds that they regrant. Many of them also offer services like administrative or capacity-building support to funders, nonprofits and/or the larger field. Philanthropic intermediaries can help donors easily and strategically move resources to small or new groups doing important work, organizations outside the United States, grassroots groups, and underfunded sectors. There are a lot of good reasons for a funder to work with an intermediary, including:
To maximize your impact by combining resources with other funders. Collaborative funds and giving circles are common functions of intermediaries. Individual funders can have a bigger impact by pooling resources with other funders who want to move the needle on the same issue. Even big funders often work together through collaborative funds to maximize the impact of their giving on an issue of shared concern. Collaborative funds and the like can be excellent opportunities for smaller donors to connect with and tap into the experiences of larger funders.
To more effectively fund a cause. Many intermediaries have specific focus areas and have done extensive research, built relationships with nonprofits and created informed strategies to make an impact on those issues. Instead of reinventing the wheel, you can give to an intermediary with a track record and a strategic approach to funding in an area you care about. For example, CLIMA Fund supports grassroots groups around the world advancing solutions to the climate crisis. An individual donor concerned about climate change can give to CLIMA Fund and know that their gift will be distributed to vetted organizations working effectively on this issue.
To fund groups outside the United States. There are technical, tax and other complications to giving internationally. Plus, it can be hard to know which organizations are doing the most effective work or are most trusted by local communities in an area far away from you. A U.S.-based funder who wants to support organizations working in another part of the world can donate to a U.S.-based intermediary that regrants to a particular region or to groups around the world. An experienced regional or global intermediary will have deep knowledge of and relationships with organizations working in the area you want to support. And they will make the process easier for you. You give to the U.S.-based intermediary like you would to any other U.S.-based nonprofit and they handle the administrative and other technical aspects of international grantmaking.
To know that your funds are quickly directed to the right place during a crisis. For instance, during and after climate disasters like floods or wildfires, a local community foundation may have the best information and existing relationships with on-the-ground organizations to move resources to address a local emergency quickly. Or in a moment like the overturning of Roe v. Wade, intermediaries that already have grantmaking strategies to fund groups working on reproductive healthcare access can move your gift quickly to vetted organizations serving the people most affected.
To give anonymously. Unlike private foundations, 501(c)(3) charities don’t have to disclose their donors. Giving through a pooled fund managed by a c3 thus allows donors to make gifts anonymously, which you may want to do for different reasons, including to avoid being publicly associated with a controversial cause.
Pros and Cons
Intermediaries can add a lot of value to your limited donor dollars, but there are issues to be aware of:
Donor distance from grantee. This could be a plus or a minus for the donor, but it is usually the intermediary that will form and nurture relationships with the grantee organizations, removing the donors one step from the nonprofits.
Added layer of institutionalization. Many intermediaries have close relationships with the communities they fund, do a lot of work to learn from their grantees, and form mutually supportive networks. However, intermediaries can be just as hard to access as some of the most notorious private foundations, and just as opaque and controlling. On the other hand, a nonprofit might get more money from a large collaborative fund than they would going to a bunch of separate donors and enduring multiple screening processes.
Big donor dominance. Depending on the intermediary, there are sometimes problematic dynamics with the largest contributors having overwhelming influence in how grantmaking and other networking services are executed. Sometimes, no donors have any direct say in the operations of the intermediary — all donors just give their funds and let the intermediary do its work. Donors should be clear on what level of interaction their donation to an intermediary will afford them.
Association with “dark money.” Donors can give anonymously to intermediaries, and that can be a plus for many. But it also contributes to the public’s increasing concern about big donors anonymously influencing all kinds of social change from the left and the right. Intermediaries are often at the center of media coverage of 501(c)(4) political activity, for better or worse.
Taking Action
These are some ways to find an intermediary working on the issues you care about:
Check out Inside Philanthropy’s Grant Giver page on the issue and linked intermediary profiles.
Read IP coverage of intermediaries you’re interested in using the IP search tool.
To go deeper, read our State of American Philanthropy report on the issue. Each report contains a section on intermediaries that highlights key organizations in the field.
Do a web search for “intermediary,” “pooled fund” or “donor collaborative” plus the issue you’re interested in funding.
Check out the Issue Funds and Intermediaries search page provided by Giving Compass.
Ask your local community foundation or DAF host if they know of any intermediaries working on this issue.
Look at the websites or annual reports of nonprofits whose work you admire. Check the funder lists for any intermediaries who support them — there’s a good chance intermediaries listed there fund that group as part of a grantmaking strategy or pooled fund focused on the issue you care about.
If you’re looking for a place to house your donor-advised fund or to provide philanthropic guidance, you might consider your local community foundation. There are also identity-based community foundations that could be a good fit, such as Jewish community foundations or LGBTQ+ community foundations.
If you’re looking to maximize your impact on a specific issue by collaborating with other funders or giving to a regrantor that has an informed grantmaking strategy on a particular issue, look for intermediaries that have pooled funds dedicated to that issue, such as the Racial Equity in Journalism fund at Borealis Philanthropy.
If you’re looking to support organizations outside the United States, look for regional regrantors or global regrantors that focus on your causes of interest. For example, Partners Asia connects funders from around the world to local organizations in Thailand and Myanmar that are working on issues including migrant education and gender equality.
