Should You Rethink Philanthropy? A Case Against S-Process Giving

Key Insight

How you give matters as much as what you give—your approach to philanthropy shapes its impact. The nuanced debate between "foundation-style" and "s-process" models isn’t just theoretical; it transforms how strategy, flexibility, and influence play out in practice.

Two Approaches to Giving

1. Foundation Style

   • What It Is: Delegate decisions to a trusted foundation or advising organization, while offering high-level guidance and oversight.
   • How It Works: Fund the organization, maintain transparency into its decisions, and intervene only if critical misalignment arises.

2. S-Process Style

   • What It Is: Open competition between recommenders who propose detailed spending plans across budget scenarios.
   • How It Works: Recommenders persuade you to fund their ideas based on merit, with funds allocated iteratively to the most compelling case.

The Case Against S-Process Philanthropy

While the iterative nature of s-process giving seems democratic and merit-driven, it faces significant hurdles in practice. Here are three foundational critiques:

1. Flexibility is Compromised

S-process locks donors into rigid structures requiring time-intensive rounds of proposal reviews and competitions. Foundations, by contrast, enable agile decision-making, unexpected pledges, and swift responses to crises.

• Mental Model: OODA Loop (Observe, Orient, Decide, Act)

  • Foundation-style giving keeps philanthropy in an adaptive decision-making cycle, while s-process risks paralysis via overanalysis.

• Key Takeaway: Flexibility isn't just a virtue—it’s a necessity in addressing dynamic, complex problems.

• Thought-Provoking Question: Are your giving cycles nimble enough to meet urgent needs or capitalize on unexpected opportunities?

2. Privacy and Sensitivity Are Better Managed in Foundations

S-process inherently involves public competition and transparency, which can conflict with certain philanthropic goals. Sensitive grants, classified research, or initiatives with reputational risks may require discretion unavailable in the s-process framework.

• Example: A foundation quietly funding de-escalation research in high-tension geopolitical conflicts can avoid counterproductive public scrutiny.

• Key Takeaway: Some impactful work relies on privacy—a dimension where s-process philanthropy stumbles.

• Thought-Provoking Question: Is visibility in your giving strategy enhancing or undermining your mission?

3. Steering Power is Weakened

Foundations excel at aligning incentives with grantees by using levers like conditional funding or strategic direction-setting. S-process reliance on loosely affiliated recommenders dilutes this ability, offering, at best, purpose-restricted funding.

• Analogy: Steering a ship. With foundation-style giving, donors act as navigators, directly adjusting the course. S-process relinquishes control to multiple small rudders pulling in different directions.

• Key Takeaway: Influence over outcomes is often proportional to your direct involvement in steering.

• Thought-Provoking Question: Do you control enough levers to ensure your philanthropy stays on mission?

Challenges for S-Process to Overcome

While s-process has its merits (diverse perspectives, competitive rigor), it must address the following to rival foundation-style giving:

• Building mechanisms for conditional funding and better steering.
• Reducing the inefficiencies of constant competition cycles.
• Crafting provisions for handling sensitive or urgent work.

A Call to Reflect

Philanthropy isn't one-size-fits-all, but understanding the trade-offs between these models sharpens strategic clarity. Foundation-style may appeal to those prioritizing flexibility, discretion, and control, while s-process could fit those who thrive on openness, competition, and diverse input.

Ask yourself: Are your current decisions amplifying or constraining your philanthropic vision?

Sources & Further Reading

• Considerations Against S-Process Philanthropy