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©New Philanthropy Capital 2006 This document is confidential and intended solely for the use of the individual or entity to whom it is addressed Funding success NPC’s approach to analysing charities Cathy Langerman March 2007
©New Philanthropy Capital 2006 2 What is New Philanthropy Capital? NPC helps donors give more effectively Published research Understand needs Identify funding gaps Highlight excellent charities Tailored advice Develop giving strategy Select charities Manage their grants
©New Philanthropy Capital 2006 3 Why does NPC exist? Source: The UK Voluntary Sector Almanac 2004 (NCVO) Number of charities and total income by size of charities (2003-4) 39 % of income goes to just 0.15% of charities 0-£100k£100k-1m£1-10m£10m+ £1.8bn £4.9bn £6.0bn £8.0bn 0 2 4 6 8 £10B Total income to charities Charity income 0-£100k£100k-1m£1-10m£10m+ 134,513 15,785 2,167 232 0 50,000 100,000 150,000 # of charities Charity income
©New Philanthropy Capital 2006 4 Our vision is to create a more efficient market Today: Funding based on brand inertia Some donor concerns on results Vision: Better funding for effective charities Greater donor confidence and reward Research into results ‘Investment’ analysis and feedback Expert advice on strategy and execution
©New Philanthropy Capital 2006 5 Examples of return that NPC might highlight for donors 1,000% return from a special education charity One in six children in the UK has special education needs Parents often need legal support to secure additional support 6,000% return from a refugee charity One in four refugees in the UK was a professional in their home country Many need help requalifying but possess valuable skills £250,000 could pay for Training one school leaver Requalification support for 18 refugee doctors Cost and impact of tribunal appeal on special education needs £270 £3,000 Cost of legal supportAverage support secured
©New Philanthropy Capital 2006 6 So how does NPC analyse charities? E3. Assess organisationa l capacity to deliver results A. Define issue or sector B. Identify range of needs and approaches C. Define sample of charities E. Analyse each charity F. Build balanced portfolio of NPC charity recommendati ons E5. Summarise analysis: Results Risks Capacity E2. Assess evidence for these results E1. Identify activities and their results E4. Assess risks threatening these results NPC research process NPC charity analysis process D. Visit each charity
©New Philanthropy Capital 2006 7 It’s all about results FundingResultsActivity Capacity/ Resources Risks Results not achieved Effectiveness and success are based on: Results (what we really care about) Risks (inevitable, but manageable) Resources (important, but not the whole story)
©New Philanthropy Capital 2006 8 How do we think about results? Breadth (number of individuals affected) Depth (impact on each individual) Change (tackling causes/systemic change)
©New Philanthropy Capital 2006 9 What if results haven’t been measured? Build up a picture from all available evidence Logical model Demand Research User feedback Evaluations Outcome measurement Similar experience Richness of data Increasing availability
©New Philanthropy Capital 2006 10 How do we measure risks? Strategy & Concept Management Finances Operations External Charity risks a b c d e f d g h i Mitigating factors
©New Philanthropy Capital 2006 11 How do we measure capacity? Strategy & Concept Operations Finances Unmet need Vision Theory of change Growth Replicability Philosophy Governance Leadership Programme mgt. User involvement Measurement Collaboration e.g. Reserves Financial health Funding sources Funding diversification Fundraising difficulty Operational efficiency
©New Philanthropy Capital 2006 12 NPC charity recommendations – Page 1 Summary information on results and funding need, risk etc. Nature and scale of problem, eg 1.8 million isolated pensioners live in poverty 70,000 persistent truants from school 400,000 women face serious domestic abuse Description of organisation, eg History Approach Breadth of work Size and funding
©New Philanthropy Capital 2006 13 NPC charity recommendations – Page 2 Results from work, including anecdotal, qualitative and quantitative data, eg £1,000 pays for friendship for a disabled child £350 helps woman facing domestic abuse £10 in benefits advice secures £260 to alleviate poverty Why NPC likes the organisation, including, Management Cost effectiveness of approach Risk Possible uses for extra funding Brief description of organisation, including Geographic focus Growth Turnover Staff Replicability
©New Philanthropy Capital 2006 14 From single charities to portfolios Society Organisations & Policy Community Individual & Family Typically higher depth, lower breadth Typically higher breadth & change, lower depth Reach Certainty of results
©New Philanthropy Capital 2006 15 What NPC’s methodology is and is not NPC’s methodology is: –A means of structuring analyst’s judgements –A methodology to make NPC’s approach transparent to donors and charities –An attempt to provoke discussion on measurement and effectiveness NPC’s methodology is not: –An objective tool for ranking charities –A performance management tool for charities –A global reporting standard –A complete due diligence methodology
©New Philanthropy Capital 2006 16 Questions? More information available on www.philanthropycapital.orgwww.philanthropycapital.org The publication, Funding success: NPC’s approach to analysing charities, can be freely downloaded from the website –The report contains more detail on how we think about results and measurement. It also has more examples drawn from our experience. –The appendices contain each factor that NPC considers when analysing charities and indicators for each. –The appendices include a list of all the measurement, analysis and evaluation resources we identified and links to them. I can be reached on email@example.com@philanthropycapital.org
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