AI Philanthropy Is Coming. Are You Legibly Excellent?

This transcript was generated by AI and may contain typos and inaccuracies.

Welcome to High Impact Growth, a podcast from Dimagi for people committed to creating a world where everyone has access to the services they need to thrive. We bring you candid conversations with leaders across global health and development about raising the bar on what’s possible with technology and human creativity

I’m Amy Vaccaro, VP of CommCare Growth and Strategy at Dimagi and your co-host, along with Jonathan Jackson, Dimagi CEO and co-founder. Today, we get into what’s actually going to happen when the money from the AI boom reaches philanthropy in twenty twenty-seven and beyond, and what it means for organizations doing the work.

Our guest is Jack Lewers, founder of Ultra Philanthropy, an independent advisory that helps major donors give for maximum impact. He advises donors giving up to nine figures a year, and he’s chair of trustees at High Impact Athletes. He also manages Ultra Philanthropy’s mid-stage global health fund, which pairs grants with hands-on technical and management support to help global health projects reach scale.

And he writes the Funding Anthropellips newsletter. Jack makes the case that two big funders are better than one twice the size. He explains why the real bottleneck to scaling isn’t money, it’s managing directors and chiefs of staff, and he has no patience for scaling plans that end in quote-unquote dot government adoption.

If you run an implementing organization, raise money for one or give money away, Jack is direct about what’s coming and what to do about it. Enjoy

Amie Vaccaro: All right. Welcome to High Impact Growth. I am so excited for today’s conversation. So, I’m joined today by Jonathan Jackson, as always. Jon, nice to see you.

Jonathan Jackson: Nice to see you, Amy. Welcome back

Amie Vaccaro: Yeah. Thank you. I was out of the studio for a while. I took a European-style, summer vacation. And today we are joined by Jack Lewers,

Jack Lewars: Thanks for having me

Jonathan Jackson: for being here.

So I, came across your work, Jack on the Substack that we’ll add a link to and we’ve had the chance to talk offline, and I really appreciated your insight. You’ve done quite a varied things that have led you to the point that you’re at now doing this advisement work and trying to really advocate for your point of view and how impact can be made in the world in today’s day and age.

So I’d kinda love to just hear your quick backstory and how did you arrive at choosing to focus on, this specific part of the ecosystem?

Jack Lewars: Yes. Well, I did a degree in two dead languages at Cambridge University. I guess the upside of which is it forces you to think creatively about what you’re gonna do for a job, because there’s just no direct application of Latin and ancient Greek to day-to-day life. And perhaps unsurprisingly, I struggled to get a job when I graduated, particularly because I wanted to work in something that was mission-driven.

So I think there are quite well-established pipelines from that sort of degree into large consultancies or I think just about all of my friends from university are lawyers at this point. But I found it very hard to get a job for an established charity, and so I actually ended up founding a charity with someone else.

So it wasn’t my idea. They had already been running a social impact program that used rugby to help unemployed young men to find a job. But when I met them, they were looking to set up a charity, and so I was the first member of staff there. And that charity, The School of Hard Knocks, is still running now.

Predominantly now working with children who have some reason why they might not complete their high school, so often behavioral issues or special educational needs. And they use rugby still and also boxing and then a suite of behavioral therapies and assistance and cognitive behavioral therapy and so on to help them complete their exams at 16.

And there’s evidence that suggests if you successfully do that, your life chances improve significantly . And so I did that for years. About eight years I was at School of Hard Knocks growing that from just Ken Cowan, the founder, and and me to have, I think when I left, maybe about 20 staff and another, double that number in coaches and consultants and so on.

And after that, I really wanted to do something different, and so I moved to a charity called One for the World as their first full-time executive director, which asks graduates of elite universities, mainly in the US but also in the UK and Australia and Canada, to give 1% of their income to highly cost-effective global health causes.

And all the way through working for School of Hard Knocks, I’d always donated my own money to very cost-effective stuff in global health, things like the Against Malaria Foundation or the Schistosomiasis Control Initiative, which is now Unlimit Health. And so that was appealing to me because I know that a dollar goes a long way when it’s deployed in these very cost-effective programs. But after doing that for four years, I realized that although the job was to try to get thousands of people to make this small commitment of 1% of their income, actually a really large chunk of the revenue of the organization was coming from a small handful of donors that I had sort of accidentally cultivated on the side.

And I felt like that probably said something about my comparative advantages and also you know, skill set and interest. And so I was already thinking about going into ultra high net worth donating and advising, and then I met a very large donor who wanted help with their donations and so thought, “Well, the stars are aligning here.

I can’t afford to pass on this opportunity.” And so that’s when I set up Ultra Philanthropy in 2024.

Jonathan Jackson: that’s great. And you’ve now through that work, obviously found yourself in a position where we’re in a very interesting time. People think a huge amount of wealth and capital is about to be unlocked through some of the tech and AI IPOs. Within the effective giving community, there’s been many articles over the last several months yours included talking about this, this big what’s typically called the third wave of funding is coming.

And so I’d like you to just set the stage for our listeners, where are we at? But how are you thinking about this moment in time? You mentioned your comparative advantage, so I’m curious to really dig into like, you as a person specifically. When you wake up in the morning and we realize like, man, a lot of stuff’s about to change and how how much capital there is out there.

Maybe some stuff isn’t gonna change. Like how do you think about what changes you’re trying to advocate for, what you wanna see? But let’s start with just what is the stage? What is the state of the world that we find ourselves in right now?

Jack Lewars: Yes. I think something I hear a lot when I talk about this is, “Well, it may never happen.” And I think we need to be really cautious about operating on that basis because it is possible. So most of this giving is predicted if OpenAI and Anthropic have initial public offerings, and those are not certain, and there are lots of examples of companies that could have had an IPO and didn’t, and then for whatever reason, the circumstances changed and they didn’t end up ever going through with an IPO.

And also there, there are some risks of these companies losing value very rapidly if a much better competitor emerges or even if there’s some move to nationalize them, for example, for national security reasons. So there are some reasons why this may not happen, but I think we should be clear that a large proportion of the equity in these companies is already committed to charity in ways that are legally very difficult to undo.

So in the case of OpenAI, 26% of their stock is in the OpenAI Foundation, so that implies around 260 billion if they’re valued at a trillion dollars.That dwarfs the size of the Gates Foundation endowment. More than double, I think.

I don’t precisely know how much Gates has on hand at the moment, but just enormous foundation. And cynical listeners may say, “Well, you can do a lot with a foundation’s money that’s above board in the U.S.” And that is true, but that money is not getting drawn out to be spent on a yacht for Sam Altman.

That money is basically committed to some form of charitable giving. And then on the Anthropic side, each of the co-founders has publicly committed 80% of their wealth to charity. Now, that’s not a legal lock, but that is a public commitment they’ve made. Now, again, your more cynical listeners may say, “Well, these billionaires will just go off and do whatever they want.”

But the other part of this is the employees themselves have committed large amounts into donor-advised funds. So again, that money only has two options if their shares are sold. One is that it can sit on the balance sheet of the donor-advised fund provider indefinitely, and the other one is that it can be given to charity.

But it’s not something that they can pull out in order to buy themselves a fifth house private jet. And so I think an unusual thing about this is the numbers are just staggering. This is such a large amount of money, but also there’s, there are strong reasons, even if you hold deep cynicism about ultra-high net wealth giving, there are strong reasons to think that this money will eventually be deployed to charities.

And actually, I’m gonna release a model on my Substack o-a-around the 22nd of September that will allow people to play around with their own assumptions. So if you are very skeptical, you can reduce the number of founders who follow through on their commitment to zero, and what you’ll find is there’s still probably gonna be about $130 billion available for charity in the central case.

So I think almost everything is about to change because , that money will do two things. It will fund a lot of stuff, but it will also displace a lot of existing philanthropy. So at the moment, the effective giving space, the sort of effective giving space, probably about $2 billion a year in giving.

Well, many of those recommendations will be snapped up by these donors, and so almost everybody who’s giving to those things at the moment is probably gonna need to find something else that they can donate to. So even if you are completely disconnected from any AI wealth holders or the charities that are likely to receive it, I think there is gonna be a knock-on effect in the areas where these people want to donate.

Maybe if you’re doing something that’s just completely disconnected like, l- local soup kitchens in the US, which was probably quite a long way from the effective giving space. Maybe you won’t feel any effects of it there, but I think in a lot of places you are gonna see some effect from this, this philanthropy

Jonathan Jackson: And you mentioned that skepticism, which obviously is highly salient in the United States right now given public opinion on a variety of things. But I think it’s also important to remember the founding reasons for some of these companies in the first place was also fairly pro-social.

A lot of the employees, Jack, that you’re referring to, the founders the reason these foundations got started the corporate bylaws, they were, related to AI safety, related to, you know, improving humanity. So I think it’s also more likely than not than like an oil company, for example, that they do follow through on these pledges and do take their giving seriously.

And so I think that is a baseline too, of just like when you remember like why Anthropic started itself, why OpenAI started itself, why OpenAI has a foundation that has 26% of its equity. Anthropic’s owned by their own benefit corporation as a board of trustees. So there’s like, there is a lot of legal stuff here.

There’s a lot of non-legally binding things that are commitments, but I think there’s probably gonna be an above average follow through than a typical massively growing, capitalistic company. And reason to think that might play out that way, as you said, Jack.

Jack Lewars: Yeah I completely agree with this. And m-most of the people who were prepared to take a big risk by going and working for an AI company in the early days were very committed effective altruists, because the effective altruism space thought about AI, probably still thinks about AI more than most people.

Maybe not now when it’s very mainstream, but for years it was a sort of lone voice on this. And effective altruism has a mixed reputation, but I think something that does define people in that community is their willingness to give money away. One of the first things that effective altruism ever did was set up a pledge organization for people to give at least 10% of their income away, and thousands of people have done that.

They set up something called Earning to Give, which is where people went and took very high paying jobs with the aim of giving enormous amounts of their money away. I know people personally who give 80% of what they earn away, so they live a relatively modest life in comparison to what they could have on their salary.

And I do think that’s quite admirable and quite unusual. They really are truly materially sacrificing things that they could have in their life for moral reasons in a way that’s actually quite rare. And then the other thing that we should say is behavior is already changing even if this money never arrives.

So Coefficient Giving gave GiveWell a billion dollar commitment a couple of months ago. GiveWell just made the largest grant in its history to the Against Malaria Foundation . And so , the landscape is already changing in response to this money, anticipating this money even if it never arrives.

I have also personally worked with people who work at these companies to give away tens of millions of dollars, and that’s before any IPO has happened. So, so there is going to be some effect from this, even if it turns out to be a bit anticlimactic.

Jonathan Jackson: Well, let’s take the scenario where it’s climactic as the path we’re on now. So you specifically started, as Amy, Amy talked about in the opening, a mid-stage fund to fill a gap that you’re seeing. And so could you talk a bit about what that mid-stage fund is targeting and then why you think that gap currently exists and how and what you’re doing to try to figure out, what role that plays?

Jack Lewars: Yes. We often describe ourselves as providing Series A funding in global health, which is a phrase borrowed from the kind of venture capital world of supporting startups. I think There were two things that we thought were gaps that we could help to address when we set this up. One is, if you think about the route from going from having a successful pilot, so you have a program in global health that you’ve tried that has good looking results on a fairly rudimentary evaluation that’s been running for a couple of years, and maybe you’re able to spend a couple of hundred thousand dollars on it per year.

If you think about the journey from there to being an at-scale organization, and as a shorthand, let’s just assume that means that you’re able to absorb and deploy $10 million a year in funding. One thing that’s really difficult is finding funders who can walk that road with you, because when you’re raising a few hundred thousand dollars, you’re dealing with one set of funders, and then the kind of funder that could give you $7 million to help you scale up is a completely different sort of funder.

So we believed, and still believe, that there’s a gap between those two things, that you can raise your early money from even from sort of modestly wealthy individuals that you might know or from some institutions that take an early stage bet on things, and then at 10 million plus there might be a GiveWell or a Gates Foundation or a Ford Foundation or whatever’s left of bilateral aid to fund you at that kind of scale.

But there’s a gap in the middle, and a lot of the existing players who are interested in this mid-stage just don’t have that much money to give away relative to the problem. So if you’re trying to take an organization that needs a million this year, 5 million next year, 8 million the after, you’ve got to have a lot of money to do that.

And that’s just for one organization, and that’s assuming, by the way, that you don’t fill all of their funding gap. Maybe that’s 80% of their funding gap. And so I feel like if we can raise enough money for the fund we will be able to just take bigger swings in this area than some of the existing players.

And then the second thing is no one has really cracked the code on what it actually takes to scale. There’s a lot of discussion about this at the moment, and it may be that there is no answer to this. Maybe it’s just too complicated, but we think it’s worth putting a lot into the non-financial assistance in the fund.

So not just offering stable money that grows as the organization grows, but also really building a sort of scaling academy into the fund that will help us to give grantees the support that they need. And a lot of that might be providing them with coaching and mentoring. It might be connecting them with specialist providers around things like monitoring and evaluation and supply chains, logistics It might be offering backend support, so things like HR and finance that can scale as they grow, or it might even be offering fractional staff who can go and be a part-time CFO for them or CTO or similar.

And actually when I think about another impact of the AI money, if it lands, I expect fundraising to become relatively easier, and so it to become relatively less important for our fund to have a lot of money. But then I think the relative value of the non-financial assistance will go up. And so that’s why as a fund we’re recruiting and investing in this non-financial assistance.

Jonathan Jackson: That’s great. And do you-- in that analogy of Series A, who’s the Series B? How do you think about where... And one of the things that I think our community in global development, whether you’re in the effective giving community or kind of traditional health system strengthening, the milestones of what your organization is supposed to be able to do, the maturity your programs are supposed to be able to have is totally unclear.

Some funders even 10 years in want like an innovative story, and you’re like, “The whole point was to make this not innovative by this point.” “I just wanna scale.” Or maybe you’re not ready for scale because you haven’t really proven whatever the analogy is of product market fit, for your intervention.

So are you trying to think about common milestones that you could put your organizations that receive funding through to make them ready for Series B or Series C? And who is a Series B and Series C? You mentioned the Ford Foundation, Gates, and others. But from my experience, those conversations are all extremely different, right?

There isn’t a common set of metrics you can provide to a Series B funder to be like, “Look, I’m this profitable. I need $50 million so I can, 10X my scale,” and all the math works. Can we get there, and should we get there more so through what you’re trying to achieve or just in general so that there’s better milestones and more clarity for innovators, entrepreneurs and others who are working in the space trying to create the most impact?

Jack Lewars: Yeah, I should say at the outset that I’m not an expert in scaling global health stuff, and I’ve never lived or worked in a low-income country. So that’s why I’m specifically recruiting someone who has previously scaled global health interventions in LMICs, who lives in a low-income country, and so has a lot of contextual understanding to look at that side of the fund.

All that being said, I agree with your point that I think we should probably hand out funding based on some sort of milestones, achievements that show that the organization is making progress towards scale. There is another theory of this, which is that you should have take the VC approach of kind of throwing money at talented leadership teams and letting them figure it out as they go.

But I’m pretty conflicted about that, and I think the more risk-averse thing is to set goals, and if they hit the goals, then they unlock more funding and so they can move up stepwise. In terms of Series B and Series C, I think the first thing to say is we aren’t sure yet exactly when we should enter and exactly when we should exit grantee relationships.

So we’re not sure how small we should go and at w- at what point the seed funding is kind of being looked after. Up until now we’ve had this theory that we could come in when an organization already turns over 300,000 US a year, but I am hearing that it can be very hard to get from 100 to 300,000, so maybe we should go one step lower.

And also it might be that we also need to provide even bigger checks before some of the payers at scale will pick things up. And then to your point, I also am really uncertain who the eventual payers at scale are. I think, I’d be interested in your thoughts on this, but something that I have ober- obs- observed is since USAID was smashed to pieces almost everyone now says that local governments will pay for their services at scale.

But I’m not sure that there’s actually a lot of examples of that being successfully executed. So that’s kind of the going... , the two things that everybody now appears to have in their scaling plan are government adoption or I’ll charge people in some sort of revenue model in a way that will pay for this indefinitely in the private sector.

And I don’t think either of those have particularly strong track records of working out. So there is a danger that we’re actually in a world where it’s kind of GiveWell or Gates or bust, and there’s a limit to what those places will be able to fund. So it’s a problem. What do you think, John?

John, you know this world probably better than me, so what do you think?

Jonathan Jackson: Well I think th-that’s aligned to it being very difficult to monetize the government or consumer payments if you’re going after low income services. I do think we’ve seen some mid-market successes with pharmacies and other interventions, and maybe you could cross-subsidize. But on the whole I have huge skepticism on government ability to pay, not just from a pure financial standpoint but because of your point on what it looks like to scale an organization.

I don’t think there are a lot of successful examples of what it looks like for long-term public-private partnerships to be enduring and mutually beneficial for both the government and the vendor. I think some start out well, and then the vendor turns into nickel-and-diming the government. There’s some where the government turns over and fires the vendor for whatever reason.

But I think looking for, five, 10-year mutually beneficial public-private partnerships where everybody’s happy, you’d probably find a very hard time finding those And it’s just because it’s hard. I mean, these are incredibly complex ecosystems. And what I’ve been talking about a lot over the last year with the collapse of USAID is our idealized view of top priority for the government, top priority for the partner, plenty of funding policy changes.

Like, we can’t have it all. So what is the 60% to 80% we do want? How do we articulate that? How do we learn to be happy with 60% or 80%? I think pre-USAID, there was kind of this mythical desire we all had to, like, end poverty on some reasonable timeframe as practitioners in the field.

And I think, which is what’s gone on for me personally, even with this super exciting new generation of wealth coming, like, I think we were all naive in some ways of how we were having discussions and thinking about trade-offs and thinking about milestones and priorities for the last two decades at least that I’ve been in this space.

It was always like, “This project’s going to be perfect and last forever,” and, like, that’s the goal. And it’s like, no, this project should be good and durable and sustainable, but, like, we’re sh- W-we need to find the right places to compromise, the right ways to get to sustainability. And I worry a lot, not just about Series B, Series C funding, but also, you mentioned GiveWell and Effective Giving.

We have lots of conversations with them about our platforms and our projects, and they’re great funders, but they are so resource constrained right now from a staffing perspective that even if they wanted to be the Series B funder of everything you put through your pipeline, they might not even have time to engage in it.

So I do worry a lot about that. I mean, the one thing the VCs have in the commercial sector is, like, there’s a million of them, right? So it’s not a capacity constraint of people looking to do a good deal, whereas I think we could find ourselves in the, the effective giving space pretty quickly here, where kind of like everybody agrees that’s a good deal and everybody also agrees nobody has time to get the deal done.

Jack Lewars: And you’re hinting at another big concern of mine, which is concentration risk. So I believe that two Coefficient Givings beats one that is twice as big. I think the glide path we’re on is for Coefficient Giving to become much more than twice as big. And you can also substitute GiveWell for that.

GiveWell is already about to become twice as big. And that then means that if those two organizations are too capacity constrained to assess your project, or maybe it’s in an area that thematically is less-- they’re less confident in or is less appealing to them, y- you could have nowhere to go, and that’s very bad.

So yes, I agree that there’s a danger that everybody agrees it’s good and no one has the capacity to assess it. But even if it is being funded, if you and I between us can basically only think of three people who might fund something at scale, that’s very bad. And not a, a-- as you say, there are millions of VCs and then there is just trillions in private capital waiting to fund these VC-backed startups if they ever hit profitability.

And we just don’t have anything like that in global health. One, one thing that I’m hoping that the fund can do, this sounds quite hubristic it’s not very... i’m British, right? British German now, so- this doesn’t come naturally to me, but I do hope that the fund is able to inform the overall conversation about this.

I don’t come across a lot of stuff that is a really serious, informed conversation about how scaling actually works. There’s this kind of idea that everybody should want scale, and then everybody’s still referring to an article that must be at least a decade old in the Stanford Social Innovation Review about end games, and that’s kind of it.

And may- maybe there’ll be people listening to this saying, “No, there isn’t. There’s loads of stuff you’re not aware of just ’cause you’re ignorant.” Well, in that case, apo- I apologize. Please write to me and educate me. But I do feel like there could be a stronger, more robust discussion. And maybe one thing that, the, that my fund and the others in this space will do is invalidate some of these theses.

Maybe what we will find is that actually one of our values, the places we add value, is that we will invalidate the idea that government as a payer and doer at scale is a realistic pathway for most things. But that would still be a service because at the moment it feels like, at least to me, a lot of scaling plans look like we know exactly what we’re gonna do for the next five years and then dot government adoption dot infinity, and that’s not a plan.

Amie Vaccaro: Yeah. Yeah. I definitely, I hear that and I see that across the space as well. And I think what you just articulated around, like, there’s only a handful of these major donors and that being really problematic, I think that, that really crystallized for me, so I appreciate you spelling that out. And I also wanna kind of double-click into this where you’ve also written about, the bottleneck isn’t money, it’s managing directors and chiefs of staff.

You also lived this, right? You mentioned your time at One for the World growing revenue there as a full-time ED. Why is that so important, and why is the sector so bad at funding the people that will unlock everything else?

Jack Lewars: Well, everybody needs to change their behavior to fix this problem. So one pressure is that we, especially in the cost-effectiveness space, put undue pressure on organizations to bootstrap their way to scale. So we want them to be super cost-effective all the way up, and we don’t want them to do what a lot of commercially backed startups do, which is basically not be profitable for a long time, and then it works out in the end.

Which in our case would mean not being very cost-effective for a while, but ultimately being able to scale in a way that becomes very cost-effective. Now, that’s in tension with another concern I have, which is sometimes I read projections that say, “Well, in the short term, we’re not gonna be very cost-effective, but in the long term we’ll be the most cost-effective thing ever in global health by three orders of magnitude,” which I’m usually quite skeptical of.

But that’s one reason why people hire things like managing directors and chiefs of staff because they just feel like expanding their cost base and reducing their cost-effectiveness unnecessarily. There’s also funder pressure not to do that. Lots of funders restrict their funding in a way that wouldn’t allow for that kind of spending, and they are putting pressure on these orgs to look a certain way even early in their lifetime and to be very lean and cost-effective.

And maybe they’re comparing something that’s only been around for three years to new incentives, and that’s just not a fair comparison. That’s like trying to compare your two-year-old commercial startup to Apple. It’s m- maybe not a fair thing to do. But then also, I think that there is a strong ethos in the nonprofit sector for founders to teach themselves to do things that they’re not naturally good at, where I think the private sector is just better at saying, “ Actually, we want the founder’s time to be freed up for the absolute highest value thing they can do that they’re absolutely best at, and we’re prepared to just pay for everything else.”

There, there is still this kind of overall perception that people in the nonprofit sector should be scraping by with no amenities or luxuries or, and without being paid too much. And so I think it would be quite hard to have an executive assistant as the executive director of a small global health intervention.

But maybe that’s a smart move, and no one criticizes the person who’s just come out of Y Combinator and hires an EA because doing their emails is not good use of their time. But I actually think there’s a lot of pressure from all sides on charities not to do that. My point in the piece that you mentioned about managing directors and chiefs of staff is actually most of the founders that I have encountered have no comparative advantage at all in managing people and teams and delivering on time.

What they’re really good at is articulating a vision and then convincing people and money to follow that vision. But that d- it... and some of them, I’m sure are very adept managers, and some of them are very good at actually getting things done, but there’s no particular reason to think that those things overlap.

And so if that’s not you, why should you manage the whole team when you could have a chief of staff who just makes everything run for you? And then maybe you can dedicate your time to the thing that you are disproportionately good at. And then even worse than that, I see founders do things like teach themselves how to do monitoring and evaluation because they know it’s important, but they can’t afford a head of M&E.

But the thing is, that’s a technical, an advanced technical field that’s just very difficult to do to learn in your mid-career and put your own time into. So I do think these are often false economies, but the thing is, it’s both the people running the organizations would need a mentality change and also the people funding them would need a mentality change to get over this.

Jonathan Jackson: Yeah, I think one thing that came up while you were, talking there, Jack, I think one of the things the commercial sector has-- ’cause that’s true of the commercial sector, right? There’s lots of CEOs who are awful managers immediately hire a COO or chief of staff and others. The feedback loop is so much faster in the private sector that you’re rewarded fast enough for correctly delegating that you can afford to take that chance and then everybody rewards you with the next round or more profitability.

Whereas the performance feedback loop is slow enough in the, the public sector and the social sector that it makes it really challenging to take those risks even if you know it’s correct, right? Like, I don’t think any CEO listening to this is thinking, “Oh no, I should be spending my time writing those emails.”

I think they’re thinking, “Yeah, but if I hire today, that’s 12 months of salary I’m carrying before I’ll see a payback. I can’t afford that right now.” And by the way, good EAs and chief of staffs are really expensive, right? And so that I think that’s such a huge problem. That’s one of the things that we keep focusing on internally with our new Connect platform that you and I have spoken a lot about and spoken on the podcast about, that performance feedback loop for frontline workers changes how you can do things because it’s a fast enough loop that you can reward good performance, you can do things about underperformance.

Whereas in a lot of the organizational design in the nonprofits and for-profit social enterprises in the space, the feedback loop is just too slow, both because there’s not a mid-stage fund like yours with clear milestones, both because funders have very different interests in why they’re supporting an organization.

Some are supporting the organization, some are supporting the program. So there is just a lot of squishiness that I think is a huge challenge for getting through a lot of these gaps that you’re calling out. And Amy, to your point, like Amy came in and like completely transformed how we were able to think about marketing because she has an expertise in that.

But also, Amy, like at various points you’ve been doing chief of staff like work in terms of like just taking a broad strategic lens. And people who have deep skills in one area, Jack, to your point of M&E at an early-- you’re probably also doing like strategic work. You’re not just crunching the numbers.

You’re like, “This has deep implications for how we should be thinking about programs.” And so also like all key senior hires are gonna be able to massively uplift the organization, and there’s this chicken and egg problem. If only I could afford this 150K, 200K salary to get an amazing person in here who could really transform things, but I can’t ’cause my budget’s that tight, and I can’t ask for more money because I didn’t do the work that I wish that person had done for the last 12 months.

Jack Lewars: Yes. I think this links back to what you were saying earlier about milestone-based funding because I’ve been in that seat. I’ve been there. I was COO at School of Hard Knocks and I was e- executive director at One For The World. And when I thought about hiring someone, part of what I was thinking was, well, that means I’m gonna spend an extra 120K this year and then I need to raise that 120K every year for the rest of time from donors where it’s not certain whether they’re going to give me that money again. and why is this different in the commercial sector? Well, because if you’re building revenue, you have often more visibility over your future revenue than a nonprofit does. So for a lot of nonprofits, they really only have about 12 months visibility over their revenue. And that means, I know this viscerally myself, I have felt this emotionally, it is very difficult to keep hiring, especially non-frontline positions because you feel like you’re just creating a rod for your own back.

You’re just setting up, “Now I’ve got to fundraise more and more, and I’m already nervous about our fundraising.” Now, of course, it is true in the commercial sector as well that you can have customers who will abandon you over time, but I think the revenue base is more predictable. Maybe partly because it’s diversified more.

So often if y- I’m thinking particularly of tech here, if you have a lot of people who are paying you $20 a month for your software, your risk is less than if you have one ultra-high net wealth donor or one large foundation that’s putting in 70% or 80% of your funding. So this is where I think it’s really important for funders as far as possible to move to multi-year commitments and also to be very clear that they’ll fund overhead and ideally make their gifts unrestricted.

Now, someone could look at our fund and say, “Well, that’s all very well, but that’s not what you do.” And that- to which I would say yes, because we haven’t raised enough capital yet. I would love to be able to say it’s not just an 18-month grant, which is what we did with our first round. So we raised about 3.3 million in our first 12 months.

We re-granted all of it within 90 days. I think 95% within 90 days. And but we were only able to offer 18-month grants to each of the grantees because we just didn’t have line of sight over how much we would fundraise over time. What I would like to do is take us from being a $3 million fund to a $30 million fund , and then we would definitely move towards these structured milestone-based grants that go over three years.

And maybe that would give our grantees the confidence to hire things like M&E capacity, MD chief of staff. So, in case I’m not being clear enough, that is a coded fundraising plea to anyone listening to this who would like to invest in the next stage of global health. Not a very well-coded one, I expect

Amie Vaccaro: I know, that’s great. to dig in a little bit on this like feedback loop piece. And actually like, John, I’m curious to hear a bit more from you because what you just shared around like Connect being able to speed up those feedback loops. I don’t think I’d seen Connect in quite that light, so I’m curious for you to just spell that out a little bit more.

And then Jack, I’ll come back to you ’cause I, I wanna hear more about how you’re thinking about feedback loops too for your grantees.

Jonathan Jackson: Yeah. Th-thanks for the question, Amy. I mean, I have only come to this kind of anchoring recently, like in, in you were on your Eur- European time off and so we haven’t chatted about it. But Part of what would be great, like let’s say Dimagi fails and Connect fails and everything I’m working on fails, but we contributed towards just kind of performance mattering more.

And when I say it matters more, it’s because there’s feedback loops where your performance today alters your outcome tomorrow. So you have like a real incentive to perform better today. I think it unlocks so many interesting new ways to do management in the public sector, to do partnering in the public sector.

Part of the root problem, and Jack, you were alluding to this a lot, and Amy, we’ve talked about this ad nauseam, is like it-- for a lot of funding, it just doesn’t matter how good you do because they don’t have more money. So you can knock it out of the park and you can’t grow as an organization. You can have frontline workers who like 2X your cost-effectiveness and you like can’t get more money because that’s not how the market works.

And so there’s this huge problem we have in the social sector where like the incentives to do better today are so altruistic and unmeasurable that it’s a huge problem. It creates all sorts of problems for governments. It creates all sorts of problems for implementers. And with Connect, we pay you for each and every verified service delivery today.

You get paid more for doing more tomorrow, and we offer you more jobs when you do a good job on the current job. And so our hope for both our local organizations and the frontline workers is we’re creating this virtuous flywheel, and then funders are wanting to put more and more money in because they’re seeing higher and higher performance.

And we have to prove all this, and it’s gonna take hundreds of millions of dollars that we hope to raise over the next couple of years. But I think we can do it, and I think that’s gonna be a huge shift. We’ve already seen it in how we can partner with our local organizations. Instead of it being heavily trust-based and spending a lot of time upfront on due diligence, we can just offer contracts and say, “Go do 5,000 home visits, prove it, and then we can offer you 50,000 home visits.”

And so c- completely changes how you can do it. Similarly, when employers figure out, oh, we can just do a 90-day mutual employment test trial, and then we can start working together on a more permanent basis, it kind of de-risks that upfront ability to hire people. So it’s all that kind of stuff, but at its core, performance has to matter for a lot of these innovations to be meaningful.

If it just isn’t true that you crushing your 12-month plan means you’re way more likely to have money in year two, it’s a problem. And Jack, to your point, I was just reflecting, Amy, we’ve talked a ton about this on marketing investments and others. Some have the problem of being unmeasurable, but a ton of the best investments don’t have a 12-month payback.

So if you only can plan on 12 months of budget cycle, by definition, you almost can’t say yes to any investment because even the best investments are probably a two to three-year payback in, in a lot of sectors. And so, there’s a great point of like when you’re only able to think 12 months ahead because it’s terrifying, you don’t wanna have, not make payroll.

So you’re really scared to add fixed cost and ongoing things. I think that, Amy, is what I was trying to allude to. It’s like, it is just so hard and you’re, you’ve been promoted multiple times at Dimagi. Tons of Dimagi employees, get frustrated with me and us and the systems we set up and like, do we even do a good enough job as a relatively high-functioning, for-profit social enterprise at rewarding performance?

So it’s not unique to the social sector. I think it just like when you can set up these systems like this, I think it unlocks so many ways to do stuff more intelligently. And also like that’s the world I wanna live in. Like I want it to matter that we’re rewarding performance.

I- in spite of, anyth- any interest I have in Dimagi or our ideas, it’s just like that to me is how this should work.

Like people who are busting their butt at the front lines today deserve to be rewarded, for doing that.

Amie Vaccaro: Thank you for sharing that. And Jack, I’d love to kind of turn to you because I know this is also something that you’ve written about. I think from one of your pieces you mentioned, like almost nobody checks whether a grant worked. And you found that 13 of 22 donors couldn’t tell whether their AI governance funding actually achieved anything.

I’m curious to hear, like walk us through what do you actually ask a grantee to commit to upfront and how do you think about this in your own funding work?

Jack Lewars: Yes, I should cite that statistic properly, which is that Future Matters, which is a advocacy group in Berlin, had that finding, and then they wrote it up and I quoted it. But I did think it was very striking that in the field of AI governance and AI safety in particular, there was enormous uncertainty about what success looked like.

We approach this in two ways. So we have the monitoring and evaluation we do for the fund, and then we have what we do for clients of Ultra Philanthropy who’ve asked us to advise them on their giving more generally. So on the fund side, we have very light touch M&E because we don’t want to be adding unduly to the burden of the grantees.

So we accept whatever routine monitoring data they’re collecting about their frontline activities, usually without any requests or additions. Now, to be fair, because we’re selecting in large part on cost-effectiveness and because we’re in global health, which is maybe inherently more measurable than some other fields, the quality of their routine monitoring data is very high.

So it would be very unusual for us to have a grantee who were not, as a matter of routine, collecting data on how many commodities did they distribute, how many people visited the clinic, how many appointments were they able to fulfill, et cetera, et cetera. So it’s not that we wouldn’t intervene there if we thought it wasn’t good enough, but it almost always is.

What we then-- The only additional layer of reporting we have for grantees is we ask them to define some goals that specifically move them along the path to scale, because the goal of the fund is to bring things to scale. And so that is usually three to five objectives, and these are on the fund’s website.

You can see these for each organization with quarterly updates. And the reason we do that is I think it’s very easy as a founder to concentrate on the day-to-day list of tasks that you have to do without taking a step back and really thinking about, “Well, what’s the most important, but arguably not the most urgent thing that I could be working on that’s gonna help us scale up?”

So those things might be signing co-funding agreements with state governments or preparing for a more rigorous evaluation of their work, or creating a replicable playbook that means that they could franchise what they’re doing or pass it off to government implementers. Things like that, that are not directly thinking about the day-to-day delivery of the service, but more about how to scale it.

In addition to this, because my wife is a monitoring and evaluation expert in international development, we also offer monitoring and evaluation services to grant makers individuals who are giving out money to help them learn whether or not their grants are working. And that leads us into much more interesting and complex areas of M&E around particularly advocacy.

So we mentioned that finding from Future Matters, which was AI safety and AI governance. My point there is actually it would be quite easy to do a much better job. So I see a lot of reporting from organizations that is reporting on activities, but not reporting on even outputs, let alone outcomes. And actually, if you’re listening to that and you don’t know what the distinction between those things is, that might also be a sign that you need to invest more in your monitoring and evaluation.

And I don’t know if that is a lack of understanding from the organizations or it’s that the funders in those spaces have not imposed strict enough requirements on them. But in some cases, we have felt like that what they’re reporting on is kind of functionally useless for knowing whether or not they’re doing a good job.

So the example I cited in my Substack was an organization that told us that they had made 20 policy recommendations. But then when we actually asked them how many had been implemented, they said, I think it was one third of them or 20% of them had been implemented or partially implemented. And so I’m not totally sure whether they did that because they’d never really thought about it that way, or because they were being a bit disingenuous and reporting on the thing that they knew they could control or the, because the bigger number sounded more impressive.

But that’s a pretty easy example of it’s pretty obvious when you think about it, that the number of policy recommendations you make is not the most important thing to measure. And it’s pretty obvious when you think about it that the number of policy recommendations that get implemented is important thing.

now, if you are thinking, “Well, in my organization, that would just lead to us having bad monitoring data that makes us look bad because it’s slow and difficult to control getting these policy recommendations executed.” Well, sure. But then you can still say, “Well, this may take several years, so we’re gonna use proxy indicators.”

And maybe in the first year it is reasonable to say, “Look, it’s gonna take us a while to know how many of these become policy, but at least we produced the recommendations.” W- what I don’t find so easy to accept is when there seems to be an attempt to pass off an activity as if it is an important output or outcome.

and so one thing we do on behalf of the donors is just really sense check, kick the tires on, negotiate with the grantee what are meaningful indicators of progress. I should also say another thing that we hear a lot is, “Well, our work is just too hard to measure.” Well, different things are easier or more difficult to measure, but there is a, an entire science of monitoring and evaluation that has been built up over decades.

And often I feel like saying, “If your best response is our work is just so singularly genius that it’s impossible to comprehend whether or not we’re doing a good job,” that is not usually credible to me. That I have heard that narrative more than once of no one understands how brilliant we are, and I just would very much encourage you, even if you have ever thought that or said it, to take a moment and reflect on that opinion

Jonathan Jackson: I know we’ve taken a ton of your time today, but one thing I just wanted to add to that as a note to our listeners, but also to you as a fund manager and the parts that you’re working on. We talk a lot about sustainability and scale, and part of what you mentioned was the policy.

Do you wanna get paid to propose policies or do you wanna get change to get them implemented? I don’t think the funders or the innovators think enough about if you are lucky enough to be one of the firms that gets to sustainability, what is your ideal business model when you get there? Is it everybody’s still giving your organization funding because they like the founder and CEO?

Like that probably isn’t a world anyone wants to be in, but that often is how people initially get there. But what are you selling and why do you hope people are buying it? And that I think we don’t put enough thought into as we think about milestones that organizations are going through, is like in your dream world, what have you convinced people to fund and why?

And what do you wanna be measured on and why? And I think that’s a conversation that’s particularly easier to have when you’re small. And so when you get to mid-size and you’ve made a lot of promises on a lot of different indicators, it can be a lot harder to kind of take a holistic step with that. So it is actually easier, during Series A or pre-Series A funding to think about that and say, “What is the business model we’re hoping to be at if and when we do achieve, 10 million plus in annual revenue and what we look like?”

And I think Dimagi’s evolved a ton over the years on having tried everything we possibly could just to survive and then realize like, “Wait a minute, we survived, but now we don’t like our business model.” And so that I think is a, a critical thing for both sides of the ecosystem to be thinking about as early on as possible.

Jack Lewars: Yes, I think One good bit of feedback that I had on the funding Anthropolyps, which is what I somewhat flippantly call my blog is we missed a stage in our recommendations for organizations when they’re thinking about a scaling plan, which is you should think about the end state before you start costing and writing your scaling plan.

And to some extent, that’s sort of trite advice because of that article it does imply very different things about your strategy for scale depending on where you think it will end up.

And I do feel like at the moment there’s a kind of pressure because of the changes in bilateral aid, the, the catastrophic reductions in bilateral aid just to pick one of it’ll work commercially or the government will pay for it and then you feel like you’ve done your scaling plan. But I would be excited to see organizations who have put more time and serious executive time into thinking about how they might realistically scale.

And to some extent, I think we’d probably be biased to back organizations who do not pick one of those two end states because it would stand out in comparison to everybody else who sort of seems to be telling us the same thing.

Amie Vaccaro: If I might just ask one final closing question and then we can wrap this. And I think - There have been some nuggets throughout, but just in case folks are multitasking as they’re listening I’m curious, like, you’ve written about, IPOs coming Q4 of this year, money actually moving Q2 of 2027, I understand.

If someone in the audience is running an organization, an implementing organization on the ground what are your top pieces of advice for what they should be doing now to best position themselves to receive and move that money?

Jack Lewars: You have to be legibly excellent to the people who control this money. So we can have a long debate about whether it’s a good thing that a relatively small number of people living in the same part of the US are gonna control all of this money. And we can also have a long debate about whether it’s reasonable for them to focus on cost-effectiveness and scalability.

But the truth is, those are the facts on the ground. And so one part of this is to be excellent, and to them that means being cost-effective, doing stuff where there’s evidence that it works in the real world, both generically and also for your implementation of it, and having a robust plan for scale. And then the other part is being legible.

Now, some part of that is already covered in what I just said, which is do you have a theory of change, a cost-effectiveness evaluation, internal or external, and can you point to evidence that what you do really works? But that’s also about visibility. So once you have those things, and so are able to speak the same language as these donors, how do you become visible to them?

Now, one way is to try to get into spaces where they will find you, so that might be going to conferences, being on podcasts, writing articles in places that you think these donors will organically come across you as an organization. But the other thing is to use trusted intermediaries because these are very time-poor donors.

The people who are working in these frontier AI labs are working insane hours, and that’s probably not gonna get any easier if they IPO because they’ll be under a lot of pressure to keep the stock price going up and to raise more money to invest in compute and so on and so forth. And so a lot of their giving is gonna be delegated to intermediaries.

So that’s some of the folks we’ve already mentioned, so Coefficient Giving and GiveWell, Founders Pledge in the AI safety space, Longview Philanthropy some of the animal funders like Sentara Animal Funders Animal Charity Evaluators, et cetera. But that’s also places like Ultra Philanthropy and some of the more boutique advisories.

So we try to position ourselves at Ultra to be an independent second opinion in global health, complementing the work that’s being done by Coefficient and GiveWell. and then there are also places like Bedrock Philanthropy that and LS Impact that are able to offer that. So, you have kind of two choices.

You either need to get directly to the AI wealth holders with your excellent rigorous plan for how you’re gonna scale cost-effectively, or you need to be recommended by one of those intermediaries. And other than that I think it would be difficult to realistically expect to access this.

I should also say, ’cause this was the first post I’ve wrote on my Substack, please don’t send them a cold email by reverse engineering their email addresses. It really truly doesn’t work, and my understanding is that they’re getting up to 20 of these a week, and so you are not likely to be successful at all, and you are adding to a real sense of exhaustion and dread on behalf of the donors by

Jonathan Jackson: Well, wonderful. We appreciate all your time, Jack and tons of insight here for our listeners. So thank you for being willing to spend time with us

Jack Lewars: Thanks for having me

Amie Vaccaro: Thank you so much, Jack. Great to have you

A huge thanks to Jack Lewers for his time and his candor, and thank you for listening. A few things were taken away. One, this money is more locked in than the skeptics think. Equity sitting in foundations and donor-advised funds can’t be pulled back out for a yacht, and behavior is already shifting in anticipation of it.

Two, concentration is the real risk. Two big funders beat one twice the size, because if the one can’t get to your project, you’ve got nowhere else to go. Three, fund the management layer. Founders are usually brilliant at articulating a vision and getting people to follow it.

But there’s no particular reason to assume that makes them brilliant at running teams. Four, measure outcomes, not activities. Twenty policy recommendations made is not twenty policy recommendations implemented. And five, if you want this money, be legibly excellent, and please don’t send a cold email.

That’s our show. Please like, rate, review, subscribe, and share this episode if you found it useful. It really helps us grow our impact. And write to us at podcast@dimagi.com with any ideas, comments, or feedback. This show is executive produced by myself. Prathana Balachander and Michelle Abulencia are our editors.

Natalia Glowacki is our producer, and cover art is by Sudhanshu Kanth. A final note in the spirit of transparency. We use AI to assist with guest research, copywriting, and post-production, so a small team can produce a high-quality show. All AI-assisted content is reviewed and edited by humans, and we retain full responsibility for what you hear