The future of grantmaking

Posted on 09 Nov 2018

By Kathy Richardson, Executive Director, Our Community

I want to start by making a confession. I'm a grant nerd. For five years I edited The Australian Best Practice Grantmaking Quarterly, the predecessor to Grants Management Intelligence, which is still devoted to the art and practice of grantmaking.

Our Community's Kathy Richardson.

I helped found the Australian Institute of Grants Management (AIGM) and was part of the team that envisaged and built SmartyGrants.

I apply for grants on behalf of some of the not-for-profit organisations I'm involved with, and I serve on grants assessment panels as well.

I've read auditors' reports that have picked grants practices apart and I've listened to so much grantseeker "grants rage" that my straight hair turned curly. I've listened to grantmakers' "grants rage" too, at countless conferences, events and AIGM Musters.

Before I joined Our Community in 2003 I had no idea that there was such a thing as a grant. But over the years this whole grantmaking thing has gotten under my skin.

As a result, I now care deeply about the work, and I understand how hard it is, and how rewarding it can be. Above all, I understand the enormous difference grants can make to the world when you get it right.

While I accept I'm no grants oracle, I've been able to develop a bird's eye view of the sector during that time. Here's what I've learnt.

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Sharing was high on the agenda at the "hot spot" sessions at the annual Grantmaking in Australia conference.

The grants industry: How far we've come

Grantmakers like to say, "If you've seen one grantmaker, you've seen one grantmaker." Each one tells us that they are unique. But if you take a broader look, you will see that you're more alike than you think.

But before we look to the future, let me make a few observations about the journey here.

A grantmaking community

Fifteen years ago, it was hard to find a community of grantmakers. Philanthropy was a thing, but government grantmakers, by and large, tended to define themselves through other roles, such as community development officers or economic development officers or administrators.

Back then, people were scared of putting themselves out there as people who knew a thing or two about getting money from A to B.

That's changed. And our most recent sold-out conference was evidence of that, where the one thread that drew those delegates together was delivering money via grants.

It may seem a subtle change, but I think it's significant. It's an acknowledgement that grantmaking is a profession, and some would say an art. That there are particular skills involved, and you can be good or bad at it. And that factor - how well you do it - can make an enormous difference to how much value is derived from those precious funds that are offered up to the cause.

Siloes breaking down

The rigid lines that once separated grantmakers are dissolving. Once, philanthropic, corporate and community grantmakers didn't associate with government grantmakers, and vice versa. They just didn't think they had anything in common. But it also meant opportunities for sharing information, lessons and even funding were lost.

We still have a bit of a way to go on that front, but I do think we're making progress.

Higher standards, better governance

The field has largely moved on in terms of governance, with discretionary funds (councillor or MP slush funds) and election war chests becoming harder to find.

Guidelines are becoming clearer - at the AIGM we're now mostly able to draw a line from policy outcome goals to application and assessment forms.

Grant rules are clearer now - people know more about timelines and process. And the outcome of that is - generally - fairer, more transparent, more effective grantmaking.

More respectful relationships

We've also seen an erosion of once widespread "master-servant" relationships between grantmakers and recipients. Grantmakers largely seem to have come around to the view that their grantees also have skin in the game and something valuable to offer.

At the AIGM we often hear from grantmakers asking how to do a better job of working with grantees, and to ease their administrative load.

Grantmakers are also taking note of the clarion call from grantseekers to improve feedback about unsuccessful applications. There's still work to do, but the situation is improving, and I have observed a genuine desire by most grantmakers to improve.

Embracing technology

Technology has played a big role in the changing grantmaking landscape over the past decade and a half. Our annual grants survey noted in 2013 that grantseekers' preferences for application forms had shifted to online forms, and most grantmakers have responded.

Most grantmakers have made the shift away from paper and spreadsheets, and into online systems like SmartyGrants, creating enormous efficiencies. That has led to a greater awareness of, and emphasis on, data governance. We're part of that discussion, given that we hold so much of the data that you and your grantees produce through the SmartyGrants system. We talk about data governance and ethics daily at Our Community, and we are working hard to stay well within the lines of what grantmakers and grantees rightly expect.

Top trends in the sector: how the AIGM is involved

Outcomes the big move in grantmaking

My top pick on this front is the sharp reorientation towards outcomes-focused grantmaking.

Nobody knows precisely how much money is given away in grants each year in Australia, though by pulling together figures from various sources, we've come up with an estimate of about $80 billion.

We all have an obligation to make sure that that money is going to the right places, for the right projects, and to know if we are creating the outcomes we're aiming for.

That's not to say that no one can ever try anything new or risky - I'm a big fan of innovation - but I think that people are growing intolerant of programs that just throw money at the wall to see what'll stick.

And with better and better evaluation models and data collection and analysis tools coming online all the time, we're really running out of excuses.

We are working on a system to help grantmakers and grantees to learn more about outcomes, and to use that knowledge to make better funding decisions.

We've called that tool the Outcomes Engine and we plan to have have something pretty exciting to show you next year. Obviously, we're taking our time with this one, because it's very easy to stuff it up. Contact us if you'd like to know more. Part of the project involves mapping, which I'll discuss later in this article.

Visualisation changing the way we see data

Visualisations are reshaping how we perceive the world and helping us make more sense of the data we're all producing mounds of, every minute of every day.

This includes infographics, short and often animated videos, and "scrollers" such as those used on news sites.

Grantmakers, too, are starting to benefit from the growing ubiquity of data visualisation tools.

New dashboard-style data tools help grantmakers see more clearly and quickly where their money is being distributed.

One of our first efforts was to release a dashboard into SmartyGrants last year showing insights about application submission numbers, application approval and submission rates, which focus areas money is flowing to, and which population groups are benefitting. We're expecting to add more "widgets" as we can.

Our newest tool is SmartyGrants Maps, part of the Outcome Engine project, which lets grantmakers see their grants geographically, whether across a region or a particular point. We expect the tool will enable grantmakers to learn about over- and under-funded areas, or areas with unusual application levels.


Many grantmakers are natural connectors and collaborators. But this impulse appears to be growing, with more openness to initiatives to share resources, contacts and knowledge.

Our sold-out conference was a strong indication that people want to learn from their peers, while our networking events and Grantmaker Musters across Australia and New Zealand are well attended.

There has also been a spike in activity on our online grantmaking forum. AIGM members and SmartyGrants users have free access to the many good discussions about issues such as speeding up processes, tracking KPIs and many more.

Data and technology: Come up to the lab

Much of our most interesting work involves data science initiatives, driven by members of our Innovation Lab. You can read more about their activities elsewhere in this edition, and by visiting The Innovation Lab

A common language: CLASSIE

Grantmakers have shown a strong interest in the social sector taxonomy that we developed, CLASSIE, which is designed to get us all talking the same language.

Our existing lists classify subjects, populations and organisations, but future lists will also classify grantmakers (by size, sector, subject and population areas) and funding types, and we're adapting the system for our New Zealand cousins.

We're using CLASSIE to create dashboards to show at a glance what funding practices look like. And importantly, if we're all using the same basic system of classification, we can start charting cross-sector and intra-sector trends.

Data from recent CLASSIE trials - particularly those involving local government grantmakers, who often lead the way - is starting to paint a picture about funding trends. We now know that children and youth are the most commonly targeted beneficiary populations for local government grantmakers who use CLASSIE standard fields.

And we know that the sectors that are most commonly funded by those councils are arts and culture; sport and recreation; and community and economic development.

Of course, there remain many gaps in the data which we hope to close as more organisations get involved.

CLASSIEfier: A helping hand for grantmakers

A related project, CLASSIEfier, is in the hands of Innovation Lab data scientist and former astrophysicist Paola Oliva-Altamirano.

CLASSIEfier is an algorithm being developed to teach a computer to "read" a grant application to tell the grantmaker what subject and population group the applicant is targeting.

This automatic classification system has multiple applications, one of which is sorting historical records to uncover funding trends.

This challenging project has seen Paola recognised in an international fellowship which is helping push this effort.

Tessa the Assessor: Assessing grants quickly

Through this project we're hoping to use machine learning to speed up the assessment process, automating the parts of that task that lend themselves to algorithmic sorting.

The project reminds me of a quote that an American grantmaking peak body used in a training session: "Can something do my work, so I can do my job?"

That sums up what we're trying to achieve with Tessa: getting a machine to do some of the drudge work, so you can concentrate on the parts of your job that add value.

Chasing the evidence for impact

This year, we've been working with The Channel, a giving circle that focuses on the LGBTIQ+ community. And it's a project we believe will have applications across the social sector.

The Channel has been working with data scientist Joost van der Linden to interrogate the LGBTIQ+ landscape. The hunch is that this community is being under-funded, and if that's the case, The Channel will have the evidence it needs to lobby for change.

A side-benefit is that we have developed a system for combining data from multiple sources - the ACNC, GiveNow, SmartyGrants, and our own Funding Centre database - to paint a really interesting picture of the funding landscape, using CLASSIE classifications, of course. We hope to apply those tools to other subjects and population groupings over the next year or so.

Gender analysis

We're strong supporters of gender equality at Our Community, and our work has included adding gender lens questions and a gender lens widget to SmartyGrants, as well as providing supporting materials for grantmakers and grantseekers.

This year we also analysed SmartyGrants grant application data in terms of potential gender bias in the awarding of grants. Among our key findings, we found that women submitted far more grant applications than men, but men were more likely to lodge $1 million+ applications. Success rates were about equal. To read more about the study, click here.

Grants in Australia research study

Another project we've been working on is the Grants in Australia research study, which featured heavily in the August 2018 edition of Grants Management Intelligence. Read more at

Why we've got to do this together

Finally, as we continue to improve our tools, we hope AIGM members will take a keen interest and help us to achieve our goals by using our tools and telling us what you really think about them.

And I really do believe that being collegiate will serve us well. Turn up, share your pain and your triumphs, and contribute to the conversation and to the development of the field.

In that way, we'll find the sweet spot between respecting grantseekers' capacities and needs and serving the requirements of grantmakers themselves, including as we make that tricky shift to outcomes-focused grantmaking.

This is an edited version of a presentation made to the 2018 Grants in Australia conference. Delegates are able to download presentations from most of the speakers. Contact [email protected] if you haven't received the appropriate web link.