Philantropic Intermediaries

Citation: Tom David (2020) Philanthropic Intermediaries in this Moment of National
Reckoning. Los Angeles: The California Endowment.
Philanthropic Intermediaries in this Moment of National Reckoning 2

TABLE OF CONTENTS
Executive Summary 3
Dedication 9
Introduction 8
Four Questions to Help Shape

Philanthropic Intermediary Strategy 15
Philanthropic Intermediary Forms 16
PI Functions 19
Benefits, Challenges and Concerns in

Relationships with Philanthropic Intermediaries 31
Opportunities for Leadership 37
Notes 40

EXECUTIVE SUMMARY
Large foundations have long used Philanthropic Intermediaries (PIs) to extend

the skills and reach of their staff and resources as well as to undertake specialized
projects on their behalf. PIs fit no single description other than that they are typically
employed to fulfill a mission-critical role “in between” the foundation and its intended
beneficiaries.
PIs can be utilized for regranting, hosting pooled funds, program design and
management, fiscal sponsorship, and a variety of efforts to build organizational and
personal capacity.
At a time when all aspects of philanthropic practice are being reexamined through
the lens of racial equity and social justice, The California Endowment (TCE) and other
funders are undertaking a fresh look at PIs as a potentially integral component of
strategy.

A new generation of leaders is emerging in communities of color that asserts its
autonomy from traditional organizational structures and directly challenges conventional
philanthropic thinking and practices. These leaders are actively engaged in the process of
figuring out the kinds of structural solutions that will best enhance the work of systemic
transformation. What forms of assistance and what kinds of PIs and/or hybrid structures
can best support their power building work as they define it and prove to be resilient in
this rapidly changing context?
TCE has already laid the groundwork for this conversation by choosing to focus the next
generation of its work on regional and statewide power ecosystems. PIs are potentially a
key component of those ecosystems, but their presence at the regional level is often less
than robust. Consonant with TCE’s larger strategic direction, it could help to redefine the
role of the Philanthropic Intermediary from a transactional agent of the foundation
engaged merely in regranting or fiscal sponsorship to an agent of transformation that
advances power building and racial equity as a core function.
This inquiry draws on 68 interviews with TCE staff, other funders and representatives of
PIs and addresses four questions:
• What forms can PIs take that are most relevant to TCE’s efforts to promote power
building and to advance racial equity?
• What important functions can PIs perform in support of TCE’s mission?
• What cautions and considerations should inform TCE’s use of PIs?
• Are there specific opportunities for leadership in helping PIs to better support the
work of emerging social justice groups led by people of color?

Forms. PIs have been viewed by many foundations primarily as vendors rather than
strategic partners. But that picture is rapidly evolving to describe a diverse array of
“platforms” that are challenging and disrupting old definitions of “intermediary” and are
poised to provide enhanced forms of strategic partnership. Rather than serving as a
mechanism to distribute TCE’s power, PIs could be a means to help share and equalize
power and pursue more equitable distribution of wealth and other resources within
communities of color. Many of TCE’s current PIs already share a commitment to those
values. Others have the potential to incorporate an equity orientation more fully into their
work, given the opportunity and encouragement.
PIs could play a more active role in managing

the power dynamics between TCE and its
grantees, seeing their contribution more in That calls for Philanthropic
terms of strengthening movements rather than Intermediary partners that are not
just individual nonprofits. only values aligned, but also have
This potential reframing of the PI relationship the lived experience of working
incorporates an ecosystem worldview that in communities of color and
does not center the foundation. Instead, it operating in a way that builds
seeks to invest long-term in a regional power
both capacity and power.
building infrastructure in which all the elements
are mutually accountable.
That calls for PI partners that are not only

values aligned, but also have the lived
experience of working in communities of color
and operating in a way that builds both
capacity and power.
Functions. Emerging social justice groups are engaged in exploring a variety of

organizational arrangements and governance structures that will provide them maximum
adaptability and flexibility to pursue community transformation. They tend to think and
operate in terms of networks rather than traditional organizational hierarchies. Not many
PIs are qualified or appropriate to meet those needs. The paper describes multiple
examples of how TCE has been working with PIs for regranting, fiscal sponsorship,
pooled funds and program design and management in support of network development,
grassroots base building, and power building activities.

The next step for TCE and for other funders is to center equity in those relationships, in
response to grassroots calls for a more “transformational” model of capacity building.
Growth is rooted in deep trust and should proceed at a pace that is respectful of that
process rather than externally determined, artificial deadlines. It is also important to
invest in the inner well-being and growth of leaders to help them be more resilient and
intentional in their work. Peer sharing and mutual support in the context of a cohort
learning model lays the groundwork for powerful interconnected networks for collective
action.
Emergent Models. The paper describes examples of “hybrid” PI forms that have
evolved specifically to support power building by people of color, including an incubator
for Latino-led social change nonprofits to a statewide network of youth organizing
groups to a national full-service PI that has focused on building the capacity of Black-led
organizations and fighting Anti-Black racism. We also spotlight new organizational
models led by people of color that are coming on-line in California with the intention of
building economic as well as political power.
Cautions and Considerations. Building Healthy Communities surfaced numerous

examples of the challenges of working effectively with PIs. Community residents and
local organizations expressed frustration about cultural mismatches and conflicts in
trying to work with PIs “parachuting into our neighborhoods.” That experience made
TCE smarter about working with PIs, and PIs in turn had to learn how to alter their
approach to engage with communities on equal footing. It also informed a more
nuanced understanding of the important roles they can play in regional power building
ecosystems.
When a foundation engages with a PI, it is not a

typical grantee-grantor relationship. The PI is
A trusted Philanthropic often afforded an unusual degree of insight into
Intermediary can speak the foundation’s internal thinking.
‘uncomfortable truths’
If sufficient trust can be developed, PIs can serve
in a way that any
as a valuable informal source of advice for both
other grantee cannot. funders and grantees. A trusted PI can speak
“uncomfortable truths” in a way any other
grantee cannot and provide an invaluable
feedback mechanism for institutions that typically receive little in the way of candid
critique. An experienced regrantor can also help to depoliticize how funds are divided
and distributed among local recipients.

Accountability. Funders need to be open and honest about the level of
prescriptiveness they intend. If a PI is viewed as a strategic partner, that changes the
nature of the relationship.
The PI is not merely an agent of the foundation, but an autonomous organization that is
equally accountable both to its funder and to the communities with which it is working.
That requires a different kind of Program Manager oversight.
Adequate Financing. Engaging PIs

should not be undertaken as a cost saving
measure. Even the most established PIs are
chronically undercapitalized.
An important
PIs are worthy of General Operating Support function of
in their own right, in addition to any program Philanthropic
grants they may receive.
Intermediaries
Those PIs most committed to centering equity is to accommodate
in their work are most concerned about the and simplify the process
financial sustainability of their new business of multiple foundations and
model. donors combining their support
for the same project.
Multiple Funders. An important
function of PIs is to accommodate and simplify
the process of multiple foundations and donors
combining their support for the same project.
However, to be a good partner in those circumstances requires bureaucratic flexibility

(e.g., accepting common proposals and reports).
Identifying Appropriate Philanthropic Intermediary Partners.

Identifying, developing, and growing appropriate PI partners should be an important
activity within each of TCE’s new regional ecosystem strategies.
Who has reach? Who has an established constituency?
They are unlikely to present themselves fully formed but will require a multi-year
investment in their capacity and (perhaps) appropriate local capital infrastructure.

Opportunities for TCE Leadership. Drawing on TCE’s own experiences as well
as the explorations of other funders, several opportunities present themselves to
advance thinking and practice in the use of PIs to support power building in communities
of color:
• Connect with other like-minded funders (both in California and nationally) that are
engaged in rethinking their work with PIs to share emerging lessons as well as
common questions and concerns.
• Convene a select group of current TCE PI partners to give them the space to talk
about how they are incorporating a racial equity lens into their work, share
learnings, and determine how they can best cooperate and collaborate on a
regional and statewide basis.
• Consider PIs as key elements in regional analyses of power building ecosystems

and incorporate them explicitly into TCE’s short-term and long-term strategic
thinking.
• Engage TCE’s existing internal transition working groups that are currently
examining different aspects of grantmaking practice to expand their scope to
examine and rethink TCE’s institutional policies related to Philanthropic
Intermediaries to streamline and enhance those relationships.
• Facilitate a program staff workshop or series of workshop to discuss selected

issues raised in this paper to build a greater shared understanding of the potential
value of PIs of various types.
Above all, use this moment of disruption of

the “normal” as an opportunity to think
differently about inherited philanthropic
assumptions, biases and practices that may
be counterproductive as TCE seeks to
redistribute and equalize power.

PHILANTHROPIC INTERMEDIARIES
IN THIS MOMENT OF NATIONAL RECKONING
This report is dedicated to the memory of Dr. Beatriz Solis, former Director
of Building Healthy Communities - South. She personally commissioned this
study, but sadly did not live to see its completion. She was a creative and
inspirational leader who was always seeking new ways to extend TCE’s
thinking and practice in the accomplishment of its mission, particularly for
the benefit of the most historically disenfranchised communities. She was a
beloved mentor to many inside and outside TCE, and she is greatly missed,
but her legacy continues. — Tom David

At this moment of national reckoning, when collective frustration and anger about
the enduring barriers to racial equity and social justice are firmly center stage, all aspects
of what many now see as the “philanthropic nonprofit industrial complex” are rightly
under examination. To its critics, it is exemplified by an entrenched hierarchy of power
relationships that has historically limited the growth and influence of organizations led by
people of color and worked to the disadvantage of their communities. Compared to big
policy issues such as payout, perpetuity, and board composition, the role of Philanthropic
Intermediaries (PIs)i may appear to be a minor piece of the puzzle. But as The California
Endowment (TCE) and other funders increasingly focus on power building and
advancing racial equity, PIs merit a fresh appraisal as an integral component of strategy.
Foundations have long used PIs to extend the skills and reach of their staff and resources
as well as to undertake specialized projects on their behalf. PIs fit no single description
other than that they are typically employed to fulfill a vital role “in between” the
foundation and its intended beneficiaries in support of the foundation’s mission. PIs can
be utilized for regranting, hosting pooled funds, program design and management, fiscal
sponsorship, data analysis and interpretation and a variety of efforts to build
organizational and individual capacity.

From its earliest days, TCE has utilized a spectrum of PIs for assignments as disparate as
the design and operation of major grantmaking initiatives (e.g., Partnership for the
Public’s Health; California Accountable Communities for Health Initiative) to the
management of statewide media campaigns (e.g., #Health4All; #DoTheMath) to serving
as fiscal sponsors for local Hubs in Building Healthy Communities (BHC) communities
(e.g., Community Partners). TCE’s PRI program relies heavily on partnerships with PIs
with specific expertise in finance to do its work. BHC affiliated efforts also utilized a
variety of PIs (e.g., Power California; YO Cali!) to help build a statewide networked
infrastructure in support of youth organizing and youth developmentii.
While they might not think of themselves as PIs, groups like the National Compadres
Network, the National Comadres Network and the Council of Elders have been
instrumental in weaving La Cultura Cura and powerful healing practices such as Circulo
into the cultural fabric of BHCiii. Similarly, organizations like the Alliance for California
Traditional Arts, the Sol Collective and Self-Help Graphics significantly enhanced local
organizing and mobilization efforts by incorporating music, dance, storytelling, poetry,
and the visual arts.
Yet when it comes to grantmaking, for at least some TCE Program Managers, the use of
PIs is not necessarily a preferred practice. Even though PIs can enhance the work, adding
a third party to the transaction puts distance between the foundation and its intended
beneficiaries. It can complicate the formation of effective working relationships and can
diminish real-time learning and communication.
Program Staff also shared numerous examples from

their BHC experience where interactions among PIs,
community members and TCE became an unhelpful
source of tension and conflict. Community residents
can perceive PI “technical assistance” as something
imposed by the Foundation in the form of a forced
marriage in which they have limited say.
In some cases, they can come to see these

arrangements as “extractive,” such as in circumstances
when they perceive that “we taught them (PIs) more
than they taught us, and they were paid more than we
were.” Although budgets are rarely that transparent, local partners may come to assume
that the PI itself is receiving an inequitable share of the foundation resources intended to
benefit their community.

Interviews conducted with local grantees over the course of BHC have surfaced
complaints about having to work with “out of town” PIs that “bring a very different lived
experience” and lack the cultural fluency to work effectively in and with grassroots
communities of color. Others have questioned whether employing PIs for (typically)
time-limited engagements is ultimately an effective way to build local capacity that will
stay in the community after the conclusion of the project’s funding.
While communities may have

pushed back against the way
in which some of those
interactions were initiated and
managed, they also benefited
in some important ways.
But there have also been many instances in which the help of PIs (e.g., in organizing and
staffing coalitions and alliances, or in understanding the intricacies of county budgeting
or the Local Control Funding Formula) has been deemed by local advocates to be
“essential to our success.” Clearly, some important skills are sufficiently technical in
nature (e.g., data analysis; media production; financial management; advanced
information technology) that they cannot be adequately transferred to local staff or
residents within the limits of a relatively short-term engagement. Nor should every
community-based organization seek to develop all those capacities. But having ongoing
access to those skill sets within a community setting can be instrumental to everyone’s
effectiveness.
BHC has yielded some valuable insights into the nuances of utilizing Philanthropic
Intermediaries. While communities may have pushed back against the way in which
some of those interactions were initiated and managed, they also benefited in some
important ways. They became more forceful advocates for genuine partnership in
situations where grant recipients are often reluctant to speak up. In interviews with the
PIs themselves, there was also acknowledgement that these sometimes-tense
engagements caused them to “fundamentally rethink how we engage in local
partnerships and adapt our practices accordingly.”

As the Executive Director of one experienced PI observed, “It was good for us to be
challenged in that way.” A certain amount of creative tension can be valuable for all
parties (including foundations) if it is appropriately structured and managed.
“A new generation of leaders is

emerging in communities of color that
asserts is autonomy from traditional
organizational structures and directly
challenges conventional philanthropic
thinking and practices.”
But there is also the potential to think about the role of PIs in a different way. A new
generation of leaders is emerging in communities of color that asserts its autonomy from
traditional organizational structures and directly challenges conventional philanthropic
thinking and practices. These leaders are actively engaged in the process of figuring out
the kinds of structural solutions that will best enhance the work of systemic
transformation. Many are skeptical about the constraints of traditional c3 organizational
practices and are exploring models of shared leadership and networked approaches to
promote collective connection and action.
These emerging leaders have a different set of organizational priorities. The chaos of
COVID-19 has essentially liberated them from concerns about rebuilding a potentially
weakened traditional nonprofit sector. But many are also new to leadership roles and
inexperienced in the face of an incredibly challenging environment.
What forms of assistance and what kinds of Philanthropic

Intermediaries and/or hybrid structures can best support
their power building work as they define it and prove
to be resilient in this rapidly changing context?

TCE has already prepared the groundwork for this conversation by choosing to focus the
next generation of its work on regional and statewide power ecosystems – illustrated by
the USC Equity Research Institute “Power Flower”iv and described in more detail in a
recent explication of “Integrated Bold Idea One. “v PIs are potentially a key component of
those ecosystems, but their presence, particularly at the regional level, is often less than
robust. They tend to be chronically undercapitalized and usually work in isolation from
each other. Interviews for this project also indicate that the PI field itself is in a state of
flux. Even the most established PIs are engaged in a process of self-examination and
reinvention to reframe their work in the context of racial equity. TCE and other funders
can facilitate their journey of redefinition and reinvention.
Integrated Bold Idea One:

California has a robust, intergenerational
power-building ecosystem for advancing
health, justice, and racial equity
Consonant with TCE’s larger strategic direction, it could help to redefine the
role of the Philanthropic Intermediary from a transactional agent of the
foundation engaged merely in regranting or fiscal sponsorship to an agent of
transformation that advances power building and racial equity as a core
function.
TCE is not alone in this quest. The Ford, Kresge and Robert Sterling Clark Foundations
have already been convening their PI partners to explore ways to enhance their ability to
manifest an equity agenda in their work, specifically to provide appropriate support to
the leaders of emerging Social Justice organizations. All have been generous in sharing
the insights they have gleaned to date, and they will be shared later in this report.
What follows is an exploration of four questions designed to help TCE consider

appropriate roles and activities for Philanthropic Intermediaries in the next generation of
its strategy formation. The information presented is drawn from 68 interviews
conducted with TCE program staff (14), representatives of Philanthropic Intermediary
organizations (34) and other funders and members of philanthropic organizations (20)
during the months of August-October 2020. A list of those interviewed in included at
the end of the paper.

FOUR QUESTIONS
TO HELP SHAPE PI STRATEGY
1. What forms can PIs take that are most relevant to TCE’s efforts to
promote power building and to advance racial equity?
2. What important functions can PIs perform in support

of TCE’s mission?
3. What cautions and considerations should inform

TCE’s use of PIs?
4. Are there specific opportunities for leadership in

helping PIs to better support the work of emerging
social justice groups led by people of color?

Philanthropic Intermediary Forms
Philanthropic Intermediaries can take many formsvi. Until recently,
it was conventional to identify three basic types: regranters; fiscal
sponsors; and capacity builders. It is now a field in flux. Some of
the largest and most established PIs (e.g., Tides; Public Health
Institute) can encompass multiple subunits and operations and
cover the entire spectrum from program design and management
to regranting to fiscal sponsorship. Community Foundations have
also historically positioned themselves as PIs to help grow and
strengthen their local nonprofit infrastructure. Other organizations that do not
necessarily identify themselves as PIs can take on one or more of these functions to
augment their primary mission (e.g., public foundations like Common Counsel or Liberty
Hill). Increasingly, experienced movement organizations are assuming PI roles as a
natural extension of their organizing and power building work (e.g., California Calls;
Movement Strategy Center).
PIs have been viewed by many foundations primarily as vendors or service providers
supported by fees. But that picture is rapidly evolving to describe a diverse array of
“platforms” that are challenging and disrupting old definitions of “intermediary” and are
poised to provide enhanced forms of strategic partnership. The very term “intermediary”
was challenged by several of those interviewed for this project. While some see it as a
value neutral label that encompasses a spectrum of potentially valuable activities, others
read it as a vestige of unidirectional power dynamics characteristic of white supremacy
that have historically worked to the disadvantage of communities of color.
In that interpretation, PIs serve the purpose of keeping ultimate beneficiaries at a

distance from the foundation, preventing direct communication and negotiation and
acting as agents of the foundation’s power to set the agenda and pick and choose
winners. That critical view of PIs is exacerbated by the popular perception that they are
often white-led organizations that do not incorporate a strong racial justice orientation.
Similarly, there is discomfort with foundations’ use of the term “partnership” to describe
such arrangements when they are often situated on a quite uneven playing field. The
terms of most of these relationships are distinctly tilted in the favor of funders rather
than a more equitable give-and-take.
While most interviewed were relatively comfortable with continuing to use “intermediary”
to describe what they do, this growing discussion signals the importance of considering
better, more nuanced ways of framing these working relationships, particularly when the
shared goal is power building and racial equity.

A variety of other terms were suggested to replace “intermediary,” including
“accompaniment” (a better description of building key relationships and learning
together), and “liberated gatekeeper” (coined by the People’s Institute for Survival and
Beyondvii to indicate a direct accountability to communities as well as funders). In its
work with the Ford Foundation, Change Elementalviii has used “host” to encompass the
variety of unique trust-based supports that emerging Social Justice groups need. The
Kresge Foundation’s FUEL initiativeix utilizes “Bridge Builders” to emphasize spanning
traditional power divides to strengthen the ties between foundations and constituent-led
groups.
While function is ultimately more important than form, what we call things does matter,
particularly in a moment when significant energy is appropriately being devoted to
calling out longstanding tacit power relationships that work to the disadvantage of
communities of color.
When TCE program staff were asked how they define Philanthropic
Intermediaries within the context of their own work, the following general
themes emerged:
• Performs a mission-critical role by assisting the foundation to carry out its
strategy.
• Adds value by helping groups that TCE wishes to invest in to be more effective.
• Extends the capacity of TCE staff to carry out work we cannot because of limited
bandwidth or because we are not best equipped to do it ourselves.
• Provides a shared platform for collaboration and collective action.
• Expands the foundation’s reach by capitalizing on the PI’s extended networks and
leveraging its relationships with systems influencers.
• Brings our work closer to ground level by connecting to local context in ways it is
otherwise difficult for a large statewide funder to do effectively on its own.
• Provides an independent check on the power of foundation staff; mechanism for

grantees to push back on TCE and encourage more candid working relationships.
Related to this final theme, several TCE program staff suggested that this is an
appropriate time for the foundation to undertake a reexamination of its reasoning and
principles for working with PIs.

Rather than seeing PIs as just a contractor or extender or helper to the foundation, they
pushed for a qualitatively different conversation -- about the potential for more genuine
partnerships in pursuing TCE’s higher order goals of power building and racial equity.
Instead of just seeing PIs as neutral resources with specialized areas of expertise, TCE
should also be looking to them as potential strategic allies.
Rather than as a mechanism to distribute TCE’s power, Philanthropic

Intermediaries could be a means to help share and equalize power and
pursue more equitable distribution of wealth and other resources within
communities of color.
Many of TCE’s key PIs already share a commitment to those values. Others have the
potential to incorporate an equity orientation more fully into the foundation for their
work, given the opportunity and encouragement.
Centering Equityx suggests three fundamental questions to assess a PI’s “stance” to

determine its potential alignment with the foundation’s mission and values and its
associated tolerance for risk:
1. How does the PI manage the power dynamics between the funder and grantees?
2. Does the PI see its role as strengthening movements or individual nonprofits?
3. Where does the PI see its role between partnering with groups to comply with
standards and adopt best practices vs. partnering with groups to work around
established (but inequitable) practices, lift up different standards and shift
systems?
Rather than viewing PIs primarily or solely as instruments to help TCE carry out its
strategy, this reframing of the relationship incorporates an ecosystem worldview that
does not center the foundation. Instead, it seeks to invest long-term in a regional power
building infrastructure in which all the elements are mutually accountable.
That calls for PI partners that are not only values aligned, but also have the lived
experience of working in communities of color and operating in a way that builds both
capacity and power.
Ultimately, the practice of working with Philanthropic

Intermediaries should embed and accelerate equity
in everything it undertakes.

Philanthropic Intermediary
Functions
When many community groups think of PIs, they
visualize “old school” models of training and technical
assistance most appropriate for service provider
organizations like health clinics, childcare centers or
performing arts groups. Ultimately, they are expected to develop a diversified revenue
base, including fees-for-service from clients, government, or private benefactors. Fiscal
sponsor or regranting relationships are utilized to “incubate” nascent organizations until
they have attained sufficient scale and mass to “spin off” as independent 501 (c) (3)s with
their own socially connected fundraising boards of directors. That is what has been
conventionally considered to be a “strong and sustainable” nonprofit, and much of
organized philanthropy has been oriented toward that outcome.
But most emerging Social Justice groups understandably do not see the value of
pursuing that goal. For one thing, they recognize that philanthropic resources for power
building work have always been scarce. Efforts to disrupt the status quo have learned to
not expect substantial support from the targets of their advocacy. Moreover, there are no
conventional fee structures that are just waiting to be captured to guarantee long term
funding for this work, particularly when it involves mobilizing poor people.
As long as people seek to organize themselves to accomplish a goal that requires

coordinated, sustained effort, there will continue to be a need for an investment in skill
building in finance, management and specialized capabilities such as data visualization,
strategic communications and information technology. But those may not be the self-
identified first order needs of emerging grassroots groups led by people of color.
Instead, they are engaged in exploring a variety of organizational arrangements and

governance structures that will provide them maximum adaptability and flexibility to
pursue community transformation. On a practical level, they are also seeking to share
essential back office functions rather than dedicating precious resources to create
parallel or potentially redundant administrative systems. They tend to think and operate
in terms of networksxi rather than traditional organizational hierarchies and they expect
everyone who works with them to center equity in the way they do business. That is
what the new generation of power building groups central to TCE’s mission needs help
with, along with opportunities to learn from and with their peers. Becoming incorporated
as a nonprofit is likely well down their list of priorities.

Not many PIs are qualified or appropriate to meet those particular needs. But even the
largest foundations cannot take on all those functions by themselves. As part of an
ecosystem strategy, it also calls on the collective actions of funders in a particular region
to help ensure that appropriate PI resources are available and accessible to local groups
who are dedicated to power building.
This moment calls for a systematic reappraisal of when and how

PIs can add value in the pursuit of TCE’s mission in the years ahead.
These are decisions that call for discernment and not a small amount
of artistic flair. But TCE is playing the long game. Providing an
emerging leader with the right kind of assistance at the right time
can pay multiple benefits down the road, as can investing in the
long-term capacity of a core group of “equity capable” PIs.
What are the most appropriate and beneficial functions for a PI to perform? It begins
with clarity about what the foundation is seeking to accomplish above and beyond
simply supporting the work. As one interviewee suggested, “a good test of whether it’s
worth investing in a PI is to ask whether the value it adds will exceed that of simply
giving each of the ultimate beneficiaries a multi-year General Operating Support grant for
the same total amount.” (Of course, that presumes the foundation is willing to make
substantial grants for General Operating Support). It is a tough test, but an appropriate
one given the chronic scarcity of philanthropic resources specifically for power building
and the pursuit of racial equity, particularly in times of fiscal austerity like these.
Current TCE Philanthropic Intermediary Functions

TCE currently makes extensive use of PIs to perform a variety of important functions in
support of its mission.
§ Fiscal Sponsorship
A good number of TCE’s primary grantee partners are fiscally sponsoredxii,

for example. Program Managers have seen the wisdom of not insisting on
rushing groups to incorporate in the “old school” fashion. Similarly, some of
the most respected and savvy managers of grantees most closely
philosophically aligned with TCE such as Mid-City CANxiii in San Diego have employed
the benefits of fiscal sponsorship to grow their organizations in a mindful and strategic
manner over a period of years before seeking to independently incorporate.

Increasingly, experienced movement partner organizations such as the Movement
Strategy Center and California Calls are themselves becoming fiscal sponsors for
emergent organizing groups that are likely to benefit in multiple ways from the
associated coaching and mentoring. Building Healthy Communities also used the
mechanism of multiple fiscal sponsors to establish Hubs in each of the 14 neighborhoods
to provide maximum organizational flexibility during the formative years of the Initiative.
Several Hub-affiliated entities have subsequently become independently incorporated or
are in the process of becoming incorporated (e.g., Alianza Coachella Valley; THRIVE
Santa Ana; Fresno BHC; Long Beach Forward; Merced BHC). Fiscal Sponsorship will
continue to be a valuable tool for TCE and its key partners in the years ahead to support
and responsibly grow new grassroots ventures as well as time-limited partnerships and
projects.
§ Regranting
TCE has also long worked with PIs for the purposes of regranting, most
recently in the time-urgent process of distributing emergency funding
related to COVID-19. When an issue is new and unfamiliar to the
foundation’s staff or it lacks appropriate local connections, it makes good
sense to engage one or more regranting partners. Not every PI is well suited to this
function. It requires existing grantmaking infrastructure, the ability to manage large sums
of money and sufficient political insulation to have its decisions stand up to community
scrutiny.
Community Foundations have proven to be particularly adept regranting partners. When

the local foundation shares TCE’s core values, as in the case of the San Francisco
Foundation and the California Community Foundation (both significantly engaged as
regranters in TCE’s Rapid Response “Fight 4 All” Fundxiv), it can add an extra dimension
to the transaction that is more akin to a genuine strategic partnership.
Community Foundations and local United Ways also played key PI roles in the recent
mobilization of private and public resources for education and outreach related to the
2020 Census. With support from TCE and other foundations, they organized regional
“tables” to facilitate a coordinated response and to distribute $30 million in private funds.
They subsequently became the regranting infrastructure for equitable distribution of $187
million in State funding, accompanied by significant additional funds from counties. The
experience of the local PIs was so positive that some are making plans to utilize their
now-established partnerships for future opportunities for large scale public-private
ventures such as redistricting.

One of TCE’s best tools in supporting local power building has been the ability of
Program Managers to make multiple targeted small grants with minimal bureaucratic
constraints. A small amount of money provided at the right moment can be critically
important in a fast-moving political environment. Whether that is ultimately an efficient
use of TCE’s institutional resources is another question. Several interviewees observed
that TCE’s internal policies have constituted formidable barriers to more flexible
grantmaking practices. This is a good time to reexamine those policies to ensure they are
consistent with TCE’s overall programmatic intent. TCE can also employ the ecosystem
frame to examine whether it could be providing critical support to build the capacity of
regional PIs and also help to redistribute wealth and power closer to “ground level” by a
more strategic approach to how it works with regranting partners.
A good case in point is the evolution of TCE’s relationship with the Inland Empire
Community Foundation. It has proven to be a skilled neutral convenor, bringing multiple
constituencies together from across the region to develop an economic vision for San
Bernardino County. It serves as fiscal sponsor for the Inland Empire Funders Alliance,
which facilitates peer learning and coordinated action among 30 funders active in its
region, and has also supported and fiscally sponsored local, Black-led organizations to
design a Black Equity Fund for the Inland Empire.
§ Collaborative Funds
When the goal is to develop collaborative strategy, educate other funders

about an issue and to raise/combine funding from multiple sources, TCE has
participated in a variety of pooled funds, typically housed at, and managed
by appropriate Philanthropic Intermediaries. Once again, having an existing
grantmaking infrastructure is key not only for the ultimate efficiency of the process but
also to provide assurance to other funders about the integrity of the distribution process.
A particularly relevant model is represented by The Fund For An Inclusive California,

hosted by the Common Counsel Foundation. Established via a co-creative process, it has
attracted support from TCE and ten other partners from around the state to model an
equity-driven philanthropic process to support power building in low-income
communities and communities of color “in movement together.” TCE is also a founding
partner and continuing supporter of the San Joaquin Valley Health Fund, hosted by the
Center at the Sierra Health Foundation. Now in its 8th year, it has grown to a network of
28 funders and has provided support in the form of grants, capacity building and
networking to 150 organizations in the Valley committed to racial equity and social
justice.

Organizations of grant makers have also become an important vehicle for establishing
and administering pooled funds. A prime example is Grantmakers Concerned with
Immigrants and Refugees, which has long played an essential role in not only educating
funders about complex issues related to immigration but also helping direct funds to the
intricate network of neighborhood organizations that live and breathe those issues in
daily life. It has created and staffed major collaborations including the California
Immigrant Integration Initiative and the California Census 2020 Statewide Funders
Initiative. TCE has also helped to stimulate multi-funder efforts to promote an equity
frame within philanthropy such as the Social Equity Collaborative Fund at San Diego
Grantmakers (now Catalyst of San Diego and Imperial Counties) and a similar effort
centering racial equity among Monterey County funders.
While these pooled fund efforts can be labor intensive and may ultimately not result in
TCE discovering organizations it had not previously funded, they are designed to serve a
different purpose. It is an opportunity for TCE to “signal” its ideas to other funders in a
collegial fashion, and ultimately to broaden the base of funders supportive of power
building and racial equity work. It is also an important way for TCE to share power with
significant local partners and to democratize access to funding for small and emerging
organizations that otherwise might not be deemed eligible for consideration by most
foundations.
There are also instances where it is important for philanthropy to make a shared public
statement that showcases collaboration on issues of universal concern. For example,
TCE has recently joined with other foundations and donors to establish the California
Black Freedom Fund at the Silicon Valley Community Foundation. It has an ambitious
$100 million fundraising goal over the next five years to support Black-led organizations.
That commitment is not intended to represent the full extent of TCE’s traditional and
ongoing support for Black-led social change, but the scale and high visibility of the
platform also has value.
§ Program Design and Management
TCE has also utilized PIs to design and manage significant grant programs.
A successful current example is the California Accountable Communities
for Health Initiative (CACHI)xv. It is technically a project of Community
Partners but supports a “backbone” program office that pools funds from
seven different funders to advise, support and coordinate multi-year demonstration
programs in thirteen locations around the state. It also supports a robust learning
practice to promote cross-site learning to facilitate complex systems change.

On a somewhat smaller scale, TCE turned to Policy Link, a frequent PI partner to design
and manage an ongoing Alliance for Boys and Men of Colorxvi. It is a vibrant network of
more than 200 advocacy organizations and community leaders working to transform
state and local policies that are failing boys and men of color. Likewise, a California-
specific funders-only coalition co-founded by TCE CEO Dr. Bob Ross and Sierra Health
Foundation CEO Chet Hewitt, California Funders for Boys and Men of Color, now
includes 17 member funders, and is housed and administered at the Center of the Sierra
Health Foundation.
As part of its efforts to “spread and scale”xvii key learnings about deep alliance building
and mutual accountability from Building Healthy Communities, TCE invited the
Rockwood Leadership Institutexviii, to develop and operate a pair of intensive three-year
fellowship programs to advance power building among individual leaders and
organizations from both Sacramento and San Diego. The positive results achieved in
building cohesive regional cohorts of leaders of color hold valuable lessons for the next
generation of TCE’s work.
As TCE’s new regional teams begin to assess the strategic options presented in their
respective power ecosystems, the foregoing examples suggest several productive ways
to work with Philanthropic Intermediaries specifically to promote power building and
racial equity work.
§ Centering Equity in PI Relationships
Sheryl Petty and Amy B. Dean of Change Elemental have clearly

articulated the challenge that lies before us:
A critical first step in the pursuit of deep equity is that organizations

experience a reckoning about power and privilege. This includes
recognizing privilege and oppression present in society and in our organizations
and methods, understanding one’s relationship to privilege and oppression, and
forming authentic alliances among people who experience both oppression and
privilege to transform society. xix
With some notable exceptions, most Philanthropic Intermediaries (and most foundations)
have not yet fully centered equity in their work. Just as the philanthropic nonprofit
industrial complex as a whole is being challenged to re-examine all of its practices
through an equity lens, even individual organizations long committed to social change
are all at various stages in a multi-step journey toward the realization of deep equity. We
are learning together as we move forward.

While TCE is well into undertaking its own equity journey, that effort is not yet complete;
and some would argue that it will always be a moving target that requires maximum
flexibility and adaptability. Particularly as TCE has focused its resources on supporting
power building in long-disenfranchised communities of color, the pursuit of equitable
practice is ongoing in all the foundation’s operations, including its use of Philanthropic
Intermediaries.
For communities of color, part of claiming their power and voice has been stepping up to
challenge longstanding foundation practices that they believe have stymied their
progress and thwarted the development of indigenous leadership. Increasingly, they are
calling out the way foundations have traditionally utilized PIs for grantee capacity
building as fundamentally misguided and poorly matched with their true needsxx As
nonprofit veteran Vu Le observes, “we don’t need survival skills for the Nonprofit Hunger
Games, but we need to figure out how to work together to bring the Games crashing
down.”
In his view, foundation-sponsored capacity building lacks an appropriate racial justice

analysis and often serves to legitimize inequitable funding practices and to further
incrementalism rather than the true actualization of grantees’ missions. He and his
former colleagues at the Rainier Valley Corps argue for a “transformational” model
of capacity building that is resonant with the cultural dynamics of grassroots
organizations in communities of color.
Growth is rooted in deep trust and should proceed

at a pace that is respectful of that process rather than
externally determined, artificial deadlines. Moreover, in
addition to building specific skills, it is equally important
to invest in the inner well-being and growth of leaders to help
them be more resilient and intentional in their work.
Peer sharing and mutual support in the context of a cohort learning model lays the
groundwork for powerful interconnected networks for collective action.
That advice will likely resonate strongly with TCE program staff, particularly those who
have worked most closely with the BHC communities. A similar set of observations
emerged from a recent study conducted by the Management Assistance Group (now
Change Elemental) to help the Ford Foundation focus on the specific needs of “Emerging
Social Justice Groups” that were less than 5 years old, led by people of color, and had
annual budgets of less than $1 million.xxi

Recognizing the unique systemic barriers these groups faced in the foundation funding
marketplace, a number of themes emerged from their interviews, among them:
• They seek “hosts” (PIs) who share their critique of power, understand
their communities’ needs and have intersecting goals. They are looking
for Movement Partners that will provide safe spaces that acknowledge
intersectionality and do not replicate systematic oppression.
• They have unique requirements that extend beyond the

needs of other start-ups. Backbone support and core
services are essential, but they also require a willingness
to share political risk; flexible leadership and coaching for
their unique challenges; and an opportunity to form peer
networks.
• They need specialized guidance in thinking about creative

structures (including alternatives to conventional fiscal sponsorship)
and alternative financing models.
It is costly to provide these kinds of tailored services, and it takes more time from the
Host’s staff to provide them than the typical fiscal sponsorship arrangement.
Moreover, Hosts who can fulfill these expectations are in high demand, and most
expressed an inability to take on more projects. To serve more of these emerging social
justice groups and to serve them better, the Hosts need more capacity, flexible capital,
and a greater investment in their back-office infrastructure and systems. They will also
need funder subsidies of their fees just to make this kind of work a break-even
proposition.
A field scan conducted for a recent TSNE1 Learning Lab yielded similar conclusionsxxii
with an additional emphasis on cultivating “network capacity” by creating opportunities
for collectively engaging in peer-to-peer learning and capacity building. It also
recommended focusing on developing governance structures that support networks,
coalitions and movements as opposed to just single organizations. Network-focused
capacity building fosters a strong web of relationships that themselves enhance and
accelerate learning.xxiii
In a subsequent Ford-funded Learning Lab designed and facilitated by Change

Elemental,xxiv ten experienced Philanthropic Intermediaries engaged in an extended
mutual exploration of how they might address opportunities related to scale and depth in
equity.
11
Formerly known as Third Sector New England, a long-established nonprofit Intermediary.
They focused on the needs of constituent-led groups that do not
have formal 501c3 status and are often led by people of color,
youth, members of the LGBTQI community, immigrants, and
other historically marginalized groups.
Those efforts rely on Fiscal Sponsors to connect them to philanthropic

institutions, yet they are challenged to find PIs that are equity-aligned
and have the capacity to take on new sponsored projects.
Echoing the findings reported above, the Learning Lab identified four high-leverage
opportunities for funders to strengthen PIs’ equity-aligned services:
• Fund PIs’ internal transformation to deepen equity in their services to meet

growing demand
• Ground partnership decisions in an understanding of PIs’ unique offerings and the

needs of constituent-led groups
• Resource field strengthening strategies that fees do not cover (such as PI

communities of practice and needed internal capacity building)
• Advocate to center equity in foundation practices and decision making
Recognizing that many PIs are on their own equity journey, the Kresge Foundation’s
Fostering Urban Equitable Leadership (FUEL) programxxv is providing critical support to
the field of equity-focused nonprofit talent and leadership development.
Utilizing Community Wealth Partners as Program Manager and Lead Learning Partner, it
has provided a curated menu of services to more than 200 Kresge grantees, provided by
a cadre of Philanthropic Intermediaries with expertise in racial equity.
FUEL is grounded in the understanding that operationalizing equity in organizations is

complex, ongoing work that needs to be resourced in a fashion that is commensurate
with the time and commitment that it will require. Advancing equity requires humility and
transparency. It also needs to be based in trust to promote an honest appraisal of
challenges.
Kresge and Community Wealth Partners have been intentional about field building. FUEL
has not only provided resources directly to participating PIs for their own internal
professional development, but it has also created space for them to learn from one
another and explore opportunities for collaboration and coordination. This experience
has also convinced Kresge of the wisdom of engaging PIs even earlier in the process as
not only advisers in program design but learning partners in implementation.

Emergent Philanthropic Intermediary Forms and Functions
Just as many established PIs are morphing to more fully embody an equity agenda,
a variety of new “hybrid” PI forms are also emerging that have been established
specifically to support power building by people of color and other
historically marginalized groups. As already noted, experienced
movement and organizing groups like California Calls and the Latino
Community Foundationxxvi are increasingly taking on traditional PI
functions like fiscal sponsorship and shared back office functions
while adding key ingredients like network building and pooling
capacities to form alliances. For example, the Latino Community
Foundation created a 16-month incubator for Latino-led nonprofits on
the front lines of social change. The Foundation invests money, provides marketing
training and fundraising mentorship and a peer learning community to amplify the voice
and accelerate the impact of grassroots organizationsxxvii
Here are some more examples that offer potential ideas for TCE’s future
use of Philanthropic Intermediaries:
§ Several of TCE’s most important allies in its power building work have come of age at
a time in which the artificial boundaries that have separated “service providers” and
“participants” are disappearing, and old models of transactional organizing are
evolving into transformational organizingxxviii
§ A direct offshoot of BHC is Youth Organize California! (popularly known as YO Cali!).

It is a statewide network of grassroots youth organizations dedicated to expanding
the capacity of young people and organizations to practice transformative youth
organizing, build power and “create long-term transformation in our communities.” It
connects more than 70 youth organizing groups around the state, some incorporated
and some not. It also works as a re-granter to get resources to those doing organizing
outside formal structures. To keep its staff small and run a lean operation, Yo Cali! has
chosen to be fiscally sponsored by the Californians for Justice Education Fund rather
than seek independent incorporation. It sees itself as accountable both to its funders
and to youth organizers and is committed to ensuring that “power goes both ways.”
§ Two additional hybrid PI structures have emerged directly from coalition building
work that began under Building Healthy Communities. The Dignity in Schools
California Campaign got its start through the BHC School Discipline work and evolved
into a movement building structure to connect statewide and local efforts.

§ It employs a distributive leadership model directed by a council of six member
organizations and utilizes the Gender and Sexuality Alliance Network as its fiscal
sponsor.
§ The CA Alliance for Youth and Community Justice began as the Justice System
Working Group under the Alliance for Boys and Men of Color at Policy Link. It is a
coalition of organizations and individuals working together to drastically reduce youth
detention and incarceration, and to improve the outcomes of systems-involved youth.
Both these emergent structures are poised to play important roles in the next
generation of TCE’s work.
§ Other experienced movement leaders are in the process of developing even more
sophisticated organizational models to support power building and advance racial
equity. Alex Tom, long time Executive Director of the Chinese Progressive Association
in San Francisco, is launching what he refers to as a “c3/c4 ecosystem” called the
Center for Empowered Politicsxxix.Similar to the model developed by the Working
Families Party, the Center (when fully realized) will include a c3 Education Fund, an
affiliated c4, a PAC infrastructure, and a Resilient Strategies LLC Management
Services Organization that will also serve as a “grassroots consultancy.” It is an
inspiring vision for developing leadership capacity across sectors to be “prepared for
all scenarios.” The Center infrastructure will allow multiple funding streams for
sponsored projects and “leverage many forms of organizations based on the needs of
the moment.” It will also be in the position to offer “pre apprentice programs” to
recruit and support individual young organizers of color drawn to power building
work.
§ Taj James (co-founder of the Movement Strategy Center) and his colleague Rachel
Burrows are impatient to broaden the focus of power building activities beyond just
political and cultural power to economic power, which they argue is foundational to
all other forms of power. They have launched a partnership of three related efforts
under the organizational umbrella “Full Spectrum Capital Partners” to target the
untouched 95% of philanthropic capital available for values-aligned investment in
“collective economic development” with a regional focusxxx. They plan to “use all
capital tools available” in order to “create diverse pathways for community ownership
and wealth building in ways that strengthen local and indigenous stewardship.”

The national level has also witnessed the emergence of several new
organizations (they do not all consider themselves Philanthropic
Intermediaries) created and led by people of color and dedicated to taking
on PI-type functions specifically to advance the development of racial
justice efforts led by people of color.
§ Borealis Philanthropyxxxi is based in Minnesota but operates nationally. It is a full-
service operation that hosts pooled funds, donor collaboratives and regrants in
addition to providing supportive services to smaller grantees that most foundations
could not do on their own. Over its first five years of existence, it has achieved a high
profile by focusing on efforts to build the capacity of Black-led organizations and to
fight anti-Black racism.
§ A final example of a different kind of emerging intermediary structure developed by

and for people of color is Edge Leadership.xxxii The goal articulated by its founder,
veteran nonprofit leader and advocate Cyndi Suarez, is to design and construct a
social change R & D platform designed primarily by and for people of color to meet,
study, create and advance social change. While it is not yet officially launched as of
this writing, it has already generated widespread interest and enthusiasm. Its initial
convenings and conversations with leaders of color in the social change sector have
already identified four themes for what they want to accomplish together: vision;
accountability; access to knowledge creation and evaluation; and space to replenish.
Further explication of “vision” yielded a list of qualities of “visioning

that supports leaders of color,” which could also stand in as a set of
principles for TCE to consider in outlining its intentions for engaging
with Philanthropic Intermediaries in the next phase of its work:
1. Creates vision that takes into account not only who frames the challenge but asks
larger questions about how we want to live and allows us to imagine new things.
2. Frames the challenge in ways that equitably distributes resources.
3. Holds difference and complexity
4. Mines the wisdom of its various cultural practices to create something new
5. Understands the phases of social change
6. Is not just strategic; it is creative and highlights the arts
7. Mitigates against the inherent risks involved in leading transformative social
change

Benefits, Challenges and Concerns in
Relationships with Philanthropic
Intermediaries
Building Healthy Communities surfaced numerous examples
of the challenges of working effectively with PIs. Community
residents and local organizations expressed frustration about
cultural mismatches and conflicts in trying to work with PIs
“parachuting into our neighborhoods.” TCE program staff
experienced difficulties in negotiating and managing PI
contracts; they were not typical grant agreements.
Particularly in the early days of BHC, they also felt that employing PIs distanced them
inappropriately from real-time learning and necessary programmatic adjustments, a
process they likened to “playing telephone.”
Part of what was going on was a lack of clarity on the part of the foundation about
exactly what it wanted to accomplish and how. But there was a shared sense that
“having someone in the middle doesn’t help.” Program staff felt “disconnected and out of
the loop” from what was happening on the ground, which was another way of saying
they did not feel in control of the agenda. Whether that was a good thing or a bad thing,
there is no question that many TCE staff found it “hard to lead from behind.”
With more experience on the ground and growing bonds of trust with local partners over
time, there emerged greater shared understanding about when and how PIs might best
be utilized. Most program staff also became more comfortable playing a more distanced
role vis-à-vis grantees. TCE also became more sensitive to the local politics of resource
distribution in the context of longstanding turf issues among participating organizations.
Some mistakes were made in “empowering” local coalitions (e.g., for Immigrant Rights)
to undertake the regranting of significant sums of money when they had neither the
infrastructure nor tested governance mechanisms to make highly political funding
decisions. In such circumstances, it is best for the PI to be insulated from neighborhood
politics, for the benefit of both local partners and TCE.
BHC made TCE smarter about working with PIs, and PIs in turn had to learn how to alter
their approach to engage with communities on equal footing. Neighborhood activists
pushed back when TCE sent uninvited representatives of PIs into their midst. Meanwhile,
PIs learned that they were not likely to continue to get business from TCE unless they
learned to center equitable practices and to negotiate partnerships before implementing
their big ideas, no matter how well intentioned.

As already noted, new PI forms are also emerging, designed by, and led by people of
color with roots in power building.
Out of those experiences has emerged a better appreciation for not only how to assess
the potential value of PIs but also a more nuanced understanding of the important roles
that they can play in regional power building ecosystems. More than one person
interviewed for this project compared PIs to “utilities” within in those ecosystems,
providing vital infrastructure and basic shared services akin to electricity and water.
Particularly with the emergence of new shared leadership arrangements and networked
organizational structures in communities of color, the potential strategic and practical
value of PIs merits a fresh reappraisal.
Tacit Benefits
When a foundation engages with a PI, it is not a typical grantee-
grantor relationship. The PI is often afforded an unusual degree
of insight into the foundation’s internal thinking and strategizing.
As a result, it is sometimes presumed by outsiders to have more
influence (or at least more of an insider’s POV) than other grantees. It is
a tricky niche to negotiate and successfully maintain over time. But if sufficient trust can
be established, a genuine working partnership with a skilled PI can yield multiple benefits
for both the funder itself and its ultimate beneficiaries.
PIs can serve as a valuable informal source of advice and coaching to subgrantees or
fiscally sponsored projects. They can also play a two-way translation function, helping
grantees to understand the foundation’s intent (by translating philanthrospeak) while
also sharing messages with the funder that would be difficult if not impossible to include
in a formal report.
A trusted Philanthropic Intermediary can speak

“uncomfortable truths” in a way any other grantee cannot and
provide an invaluable feedback mechanism for institutions
that typically receive little in the way of candid critique.
A PI adept at playing this “insider-outsider” role can also be instrumental in finessing an
appropriate process of implementation that may not have been anticipated in the original
grant. Funders are always seemingly in a hurry. Communities operate at a different pace.
A skilled PI can help to adapt timelines and funder expectations about appropriate
outcomes to better sync with the mental and spiritual toll and everyday complexities of
doing base building work in difficult times.

The PI’s role as a relatively neutral party can also be beneficial in neighborhoods beset by
longstanding turf rivalries and conflicts among local leaders. Not all power building
groups are of one mind. Building coalitions can be challenging, up against old “zero sum”
colonizer-inspired assumptions about power that assert “increasing your power
decreases mine.” Just because all parties are committed to racial equity does not mean
that all BIPOC-led groups are going to see/define it in the same way. In such situations,
an appropriate PI can serve as a mediator and facilitator in a different fashion than a
funder could. That does not make it easy. It is very tricky for a PI to walk the line re:
impartiality but almost impossible for a funder to do so.
An experienced regrantor can also help to depoliticize how funds are divided and
distributed among local recipients. Moreover, by making one grant to a PI, the foundation
can sidestep concerns about “tipping” nascent organizations operating under its
umbrella. It is also possible that a PI can offer a foundation significant flexibility (and legal
cover) in dealing with politically sensitive grantmaking. Certainly not all PIs are cut out for
this kind of work, nor would they merit such deep trust from the foundation or the
involved communities. But the right PI partner can be a significant asset in the complex
work of power building.
Some Concerns
§ Who are Philanthropic Intermediaries accountable to?
Foundations need to be open and honest about the level of

prescriptiveness they intend. If a grant to a PI is intended merely
to scale up an idea, save time and resources or share best
practices, those should be transparent ground rules for the interaction. If, on the other
hand, the PI is acknowledged as a strategic partner with its own mission and common
values framework and as an integral element of a regional power building ecosystem,
that changes the terms of the relationship. The PI is not merely an agent of the
foundation, but an autonomous organization that is equally accountable both to its
funder and to the communities with which it is working. Perhaps the number one
complaint of skilled PIs about foundations is the degree of inappropriate oversight and
bureaucratic requirements to which they are subjected. Foundation staff are not
necessarily skilled managers or facilitators, nor do they likely have much experience
forging complex collaborations. Engaging a PI that is expert in such matters becomes
essential to the work. Foundation staff need appropriate training and guidance to
exercise appropriate distance to maximize the potential of those relationships.

§ What kinds of financial support do Philanthropic Intermediaries need?
Probably the second most frequent complaint of PIs about foundations is that they
simply do not seem to understand what it really costs to do their work. Engaging PIs
should not be undertaken as a cost saving measure, for example. Foundations have long
been criticized for limiting Indirect Costs on their grants to such a degree that grantees
end up subsidizing their own projects. Even the most well-established and respected PIs
tend to be chronically undercapitalized. The fee-for-service business model on which
most of them depend is simply inadequate to provide long-term organizational
sustainability, particularly in volatile times like these. Even when they are the recipients of
generous foundation grants, those arrangements can fall well short of covering the true
costs of their operations. One of TCE’s most valued PI partners shared that they were
thrilled to receive a large three-year grant but ended up losing money on the project
(and were reluctant to tell the foundation). If PIs are to be considered key mission-critical
partners, they are deserving of General Operating Support in their own right, in addition
to any program grants they might receive. If there was ever a case to be made for true
cost funding, this is a powerful one. Those PIs that are most committed to centering
equity in their work are currently most concerned about whether their “new and
improved” business model will ultimately prove to be financially sustainable.
§ What about the case of multiple funders?
One of the primary uses for Philanthropic Intermediaries is to accommodate and simplify
the process of multiple foundations and donors combining their support for the same
project or cause, whether in the form of a pooled fund or as an expedited mechanism for
regranting. As already discussed, there are many reasons for TCE to support and
participate in such activities. While they can serve an admirable purpose, it is worth
noting that such efforts are not particularly popular with at least some program staff.
They tend to be time and labor intensive and the grantmaking outcomes are often
perceived as a product of compromise and/or designed to please the lowest common
denominator. Naturally, there are also happy exceptions that call on all the funding
partners to “up their game.” Particularly when an intermediary is hosting a project
supported by several funders, life is easier for everyone if all funders can agree to a
common (and minimal) set of paperwork requirements, including proposals, reports and
payments. That may involve compromise of TCE's ordinary requirements. However, an
expected part of the cost of collaboration is waiving those requirements in support of an
equitable, simplified process for the benefit of all.
As one put it “every extra requirement a funder like TCE or RWJF puts on us reduces
the net value of the pooled fund.”

It is suggested that these funding partnerships be treated as a separate category of
grantee to waive unnecessary reporting requirements, etc. in accordance with what all the
other funding partners have agreed to.
§ What if there are no appropriate PI candidates available in a region?
That was certainly TCE’s early experience in BHC. In some cases (e.g., Merced United
Way) the foundation worked with the most obvious local candidate in the name of
building lasting local capacity, but that PI never completely embraced an activist role.
Meanwhile, in Coachella and Santa Ana, the original choices for PI also turned out to be
suboptimal, but subsequent changes in TCE’s funding strategy eventually helped to
create locally led organizations that are poised to live on post-BHC.
Since the BHC Hubs were originally intended just to be temporary arrangements,
TCE did not intentionally set out to build new, strategically aligned PI partner
organizations in each region. In retrospect, perhaps TCE should not have been hesitant to
invest in that kind of long-term infrastructure. It is a time and labor-intensive
undertaking, complicated by local politics. Many of those interviewed for this project
advised against it, instead recommending taking the time for a deep dive into the local
ecosystem to fully assess the full range of existing players before acting too quickly to
choose any one strategic PI partner. Granted, it is unusual to find an existing PI in
underserved regions of the state that is likely to meet all TCE’s expectations. So, entering
those relationships with “eyes wide open,” and dedicating appropriate energy to
Identifying, developing, and growing appropriate PI partners should be an important
activity within each of TCE’s new regional ecosystem strategies. Who has reach? Who
has an established constituency? For example, Community Foundations in many parts of
the state have not necessarily been viewed by TCE as potential philosophically aligned
partners. But even in unexpected places like the Inland Empire, a conscious multi-year
strategy of relationship building (coupled with the arrival of a new CEO) can blossom
into an essential working partnership.
During BHC, TCE provided only limited capital funding for community infrastructure such
as parks and community centers. But local organizers increasingly see that kind of
investment as an essential element of building power and community-controlled wealth.
As TCE continues to shift its strategic focus “from initiatives to

infrastructure,” it will also need to extend its reach to seek out PI
partners with a development focus to move power to the local
level in a way that fosters genuine community ownershipxxxiii.

Opportunities for Leadership
A recently released report from the Building Movement
Projectxxxiv collects data from over 400 Nonprofit
Executive Directors and CEOs of Color about the effects
of COVID-19 and the uprisings against anti-Black racism
in their communities, organizations, and themselves. It
paints a vivid picture of the current turbulent context for
TCE’s work. Among its conclusions:
The crisis is going to get worse due to unmet survival needs, a resurgence of COVID-19
and policies that criminalize communities of color. Women of color leaders are bearing
the brunt. The toll is immense. Moreover, the long-term sustainability of POC-led
nonprofits is unclear. They heard an overwhelming message from leaders of color:
“There is no going back to normal, and this is the opportunity and moment for
meaningful systemic change.”
The report goes on to list a series of recommendations for Philanthropy:
• Commit to supporting Black, Indigenous and other POC-led organizations

• Align internal commitments to racial equity with external grantmaking
• Balance rapid response funding with a decades-long strategy
• Invest in POC leaders with an emphasis on sustainability
There could not be a tighter alignment between these recommendations and TCE’s core
values and emergent approach to strategy. The effective use of equity-capable
Philanthropic Intermediaries can directly contribute to the pursuit of each of these goals.
For example, they can help develop and support regional networks and alliances of
constituent-led groups that are not interested in becoming 501 (c) (3) s.
Drawing from the TCE’s own experience as well as the explorations of other funders
around the country, several opportunities present themselves to advance thinking and
practice in the use of PIs in support of power building in communities of color:
1. Connect with other like-minded funders (e.g., Ford and Kresge) that are engaged
in rethinking their work with PIs to share emerging lessons as well as common
questions and concerns. Engage California funders who have served as PIs (e.g.,
San Francisco Foundation; Sierra Health Foundation; Inland Empire Community
Foundation; Common Counsel Foundation) in dialogue to strengthen those
relationships and directly address the dynamics of those partnerships.

2. Convene a select group of current TCE Philanthropic Intermediary partners to give
them the space to talk about how they are incorporating a racial equity frame into
their work, share learnings with each other, and determine how they can best
cooperate and collaborate on a regional and statewide basis. Use that opportunity
to also probe for their challenges in developing a sustainable business model that
centers equity and power building. If successful, consider supporting their ongoing
connection via a Community of Practice (that could draw support from multiple
funders).
3. Consider PIs as key elements in regional analyses of power building ecosystems

and incorporate them explicitly into TCE’s long-term strategic thinking. Rather
than thinking of them simply as contractors or vendors, explore how they might
be utilized as co-creators of strategy and as mission-critical thought partners.
4. Engage TCE’s existing internal transition working groups that are currently
examining different aspects of grantmaking practices such as General Operating
Support. Encourage one or more of those groups to expand their scope to
examine and rethink TCE’s institutional policies related to Philanthropic
Intermediaries. In which ways might TCE’s bureaucratic requirements work against
the formation of multi-funder endeavors such as pooled funds and regranting
schemes? In what ways might TCE specifically set out to strengthen and sustain
key PI partners (e.g., via significant multi-year General Operating Support plus
significantly enhanced Indirect Cost allowances for projects). One key PI partner
reported in its interview that it currently has five individual restricted grants from
TCE (with commensurate paperwork and reporting responsibilities), when a single
combined unrestricted grant would represent a major energy boost.
5. Facilitate a program staff workshop or series of workshops to discuss selected

issues raised in this paper to build a greater shared understanding of the potential
value of PIs of different types, as well as promote a candid discussion of those
instances in which the use of PIs may not be the answer. Spend some time
digging into the dynamics of multi-funder partnerships and how they fit (or don’t
fit) in TCE’s overall strategy and the role of PIs in those efforts. Upgrade staff skills
in conducting due diligence of potential PI partners and in managing the nuances
of relationships with PIs to ensure maximum benefit (and minimum frustration)
accrues to local partners in TCE’s new grantmaking regions.
Above all, use this moment of disruption of the normal

as an opportunity to think differently about inherited
philanthropic assumptions, biases and practices that
may be counterproductive as TCE seeks to redistribute
and equalize power.

NOTES
i
For the purposes of this analysis, we are focusing on the use of intermediaries by foundations
that are specifically intended to help them achieve their programmatic mission. For that reason,
they are referred to here as “Philanthropic Intermediaries” (abbreviated as PIs), even though that
is not a phrase in common usage.
ii
Veronica Terriquez (2019) The California Endowment’s Youth Power Infrastructure: An
Overview of Youth-Serving Organizations and Intermediaries It Supports. Santa Cruz: UC
Santa Cruz Center for Social Transformation.
iii
https://www.nationalcompadresnetwork.org/training/lcc-overview/
iv
Jennifer Ito et al. (2019) California Health and Justice for All Power-Building Landscape:
Defining the Ecosystem. USC Dornsife Institute for Equity Research. (formerly USC PERE)
v
Francis Calpotura (2020) Integrated Bold Idea One: Proposed Common Strategic
Methodology and Shared Theory of Change. The California Endowment, unpublished
PowerPoint.

vi
For a more complete introduction to the topic of Intermediaries, the following references are
recommended:
Alice Cottingham. Smarter Relationships, Better Results: Making the most of Grantmakers’
work with Intermediaries, Grantmakers for Effective Organizations, n.d. www.geofunders.org
Tom David. Partnering with Intermediaries. (2007) archived by Grantmakers in the Arts
https://www.giarts.org/article/partnering-intermediaries
Peter Szanton. Toward More Effective Use of Intermediaries. (2003) Foundation Center
Practice Matters Series number 1.
http://thefoundationcenter.com/knowledge/research/pdf/practicematters_01_paper.pdf
vii
Persons who work in institutions often function as gatekeepers to ensure that the institution
perpetuates itself. By operating with anti-racist values and networking with those who share those
values and maintaining accountability in the community, the gatekeeper becomes an agent of
institutional transformation.
http://www.pisab.org/ourprinciples/
viii
Natalie Bamdad (2018) Strengthening Social Justice Groups and the Intermediaries That
Support Them. Washington, D.C.: Change Elemental.
https://changeelemental.org/resources/strengthening-emerging-social-justice-groups/
ix
Caroline Altman Smith and Carla Taylor (2019) Strengthening the Ecosystem of Capacity-
Building Service Providers: A Case for Why It Matters. The Foundation Review, 11 (4)
https://doi.org/10.9707/1944-5660.1496
Community Wealth Partners. (2020) What Foundations are Learning About Supporting
Nonprofit Leaders’ DEI Capacity. Troy, MI: The Kresge Foundation.
x
Equity in the Center (2020) Awake to Woke to Work: Building a Race Equity Culture.
https://equityinthecenter.org/wp-content/uploads/2020/09/eic_aww-pub_wip_final.pdf
xi
See Robin Katcher (2010) Unstill Waters: The Fluid Role of Networks in Social Movements.
Nonprofit Quarterly 17 (2); also Bill Traynor (2009) Vertigo and the Intentional Inhabitant:
Leadership in a Connected World. Nonprofit Quarterly 16 (2); and Caroline McAndrews et al.
(2011) Structuring Leadership: Alternative Models for Distributing Power and Decision-
Making in Nonprofit Organizations. New York: Building Movement Project.
xii
For a comprehensive overview of the forms of fiscal sponsorship see:
Gregory L. Colvin (2005). Fiscal Sponsorship: 6 Ways To Do It Right (Second Edition). San
Francisco: Study Center Press.
xiii
Examples cited of Philanthropic Intermediaries and projects with which TCE is currently
engaged are drawn my my interviews and are intended to be illustrative but by no means
constitute a representative or definitive sample. For every example I’ve chosen to feature, there
are many more that would tell an equally valuable story but are not included simply to facilitate
readability.
xiv
Engage R & D. (2020) The Fight 4 All Fund Learning Report.

xv
https://cachi.org/
xvi
https://allianceforbmoc.org/
xvii
Audrey Jordan and Shiree Teng (2020) Spread and Scale Year Three Evaluation Report.
The CA Endowment.
xviii
Transformations Consulting. (2020) Voice and Power: The Impact of Expanding
Leadership Development on Movements in California and Beyond. Rockwood Leadership
Institute/The CA Endowment.
xix
Sheryl Petty and Amy Dean (2017) Five Elements of a Thriving Justice Ecosystem: Pursuing
Deep Equity,
Nonprofit Quarterly. https://nonprofitquarterly.org/five-elements-of-a-thriving-justice-ecosystem-
pursuing-deep-equity/ for more on deep equity from Sheryl Petty and Mark Leach, see:
https://changeelemental.org/wp-
content/uploads/2020/07/SystemsChangeEquity_Petty_Leach_July2020.pdf
xx
See for example: Vu Le (2020) Capacity Building’s Necessary Existential Crisis; and April
Nishimura, et.al. (2020)
Transformational Capacity Building, Stanford Social Innovation Review.
https://ssir.org/articles/entry/transformatinal_capacity_building
xxi
Management Assistance Group (2017) Supporting Emerging Social Justice Groups: Insights
and Recommendations on the Ecosystem of Fiscal Sponsors, Incubators, Accelerators, and
Funders.
New York: The Ford Foundation. (MAG is now known as Change Elemental)
xxii
Elise Harris Wilkerson, et al. (2020) Capacity Building Needs, Challenges, and Best Practices
for Movements, Coalitions and Other Nonprofit Groups: A Field Scan. Boston: TSNE Mission
Works (formerly known as Third Sector New England).
xxiii
Jennifer Chandler and Kristen Scott Kennedy (2015) A Network Approach to Capacity
Building. Washington, D.C.: National Council of Nonprofits.
xxiv
Natalie Bamdad and Susan Misra (2020) Centering Equity in Intermediary Relationships:
An Opportunity for Funders. Washington, D.C.: Change Elemental.
xxv
Lori Bartczak (2018) Advancing Racial Equity Through Capacity Building: The Kresge
Foundation Talent and Leadership Development Efforts. Washington, D.C: Grantcraft.
https://grantcraft.org/content/case-studies/advancing-racial-equity-through-capacity-building/
Also see endnote 6.
xxvi
https://latinocf.org
xxvii
https://latinocf.org/wp-content/uploads/2019/06/Latino-Community_Nonprofit-
Accelerator_Evaluation-Report.pdf
xxviii
Grassroots Policy Project and People’s Action Institute. (2019). Training for Transformation:
A Report on the First Strategy College.

xxix
Alex T. Tom (2019) Building Healthy and Durable Movement Ecosystems: A “Workforce
Development Plan” for the 21st Century. San Francisco: Center for Empowered Politics.
xxx
https://fullspectrumcapitalpartners.us
xxxi
https://borealisphilanthropy.org/
xxxii
Cyndi Suarez (2020) Infrastructure for a New World. Nonprofit Quarterly (in press). And
Cyndi Suarez (2019) Rethinking Nonprofit Infrastructure. Nonprofit Quarterly.
https://nonprofitquarterly.org/rethinking-nonprofit-infrastructure/
Also recommended: Cyndi Suarez (2018) The Power Manual: How to Master Complex Power
Dynamics.
Gabriola Island, BC: New Society Publishers.
xxxiii
Rosa Gonzalez (2019) The Spectrum of Community Engagement to Ownership. Salinas:
Facilitating Power, in collaboration with Movement Strategy Center and Building Healthy
Communities, East Salinas.
https://d3n8a8pro7vhmx.cloudfront.net/facilitatingpower/pages/53/attachments/original/159
6746165/CE2O_SPECTRUM_2020.pdf?1596746165
xxxiv
Jen Douglas and Deepa Iyer (2020) On the Frontlines: Nonprofits Led by People of Color
Confront COVID-19 and Structural Racism. New York: Building Movement Project.
https://buildingmovement.org/wp-content/uploads/2020/10/On-the-Frontlines-COVID-Leaders-
of-Color-Final-10.2.20.pdf

Interviewees
Deep thanks to all those who agreed to make the time in their busy lives to be interviewed for
this project.
The California Endowment: Philanthropy:
Amy Chung Caroline Altman, Kresge Foundation

Ray Colmenar Ignatius Bau, Consultant
Alex Desautels Judith Bell, San Francisco Foundation
Steve Eldred Bess Bendet, Consultant
Judi Larsen David Bley, Bill & Melinda Gates Foundation
Margarita Luna Chris Cardona, Ford Foundation
Albert Maldonado TC Duong, Blue Shield of California Foundation
Bonnie Midura Victoria Dunning, Ford Foundation
Brian Mimura Ellen Friedman, Compton Foundation
Jeff Okey Audrey Haberman, The Giving Practice
Marian Standish Kaying Hang, Sierra Health Foundation
Christina Thompson Jan Jaffe, The Giving Practice
Tara Westman Jessica Kaczmarek, James Irvine Foundation
Sandra Witt Neesha Modi, Kresge Foundation
Lucia Corral Peña, Blue Shield of California Foundation
Kathy Reich, Ford Foundation
Marie Sauter, Bill & Melinda Gates Foundation
Linda Wood, Evelyn & Walter Haas Jr. Fund
Brian Zongolowicz, Satterberg Foundation

Intermediaries
Natalie Bamdad, Change Elemental
Jeanne Bell, Nonprofit Quarterly
Rachel Burrows, Full Spectrum Labs
Michelle Decker, Inland Empire Community Foundation
Frank Farrow, Center for the Study of Social Policy
Jacqueline Garcel, Latino Community Foundation
Emily Goldfarb, Consultant
Sybil Grant, Policy Link
Laura Hogan, CACHI
Taj James, Full Spectrum Labs
Monisha Kopila, Pro Inspire
Jeremy Lahoud, YO Cali!
Jane Levikow, Rockefeller Philanthropy Associates
Steve Lew, CompassPoint
Barbara Masters, CACHI
Susan Misra, Change Elemental
Phyllis Owens, Community Partners
Mary Pittman, Public Health Institute
Sharon Price, Rockwood Leadership Institute
Stephanie Rodriguez, RoadMap Consulting
Angela Romans, Achieve Mission
Diana Ross, Mid-City CAN
Magui Rubalcava, (formerly) Borealis Philanthropy
Peggy Saika, Common Counsel Foundation
Jazmin Segura, Fund for an Inclusive California
Mikaela Seligman, Achieve Mission
Kad Smith, CompassPoint
Lupe Solario, Community Partners
Cyndi Suarez, Nonprofit Quarterly
Alex Tom, Center for Empowered Politics
Paul Vandeventer, Community Partners
Lisa Weiner-Mafuz, RoadMap Consulting
Karla Zombro, California Calls

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Citation: Tom David (2020) Philanthropic Intermediaries in this Moment of National

Reckoning. Los Angeles: The California Endowment.

Philanthropic Intermediaries in this Moment of National Reckoning 2

Four Questions to Help Shape

Philanthropic Intermediary Forms 16

Benefits, Challenges and Concerns in

Opportunities for Leadership 37

Philanthropic Intermediaries in this Moment of National Reckoning 3

Large foundations have long used Philanthropic Intermediaries (PIs) to extend

Philanthropic Intermediaries in this Moment of National Reckoning 4

Philanthropic Intermediaries in this Moment of National Reckoning 5

PIs could play a more active role in managing

That calls for PI partners that are not only

Functions. Emerging social justice groups are engaged in exploring a variety of

Philanthropic Intermediaries in this Moment of National Reckoning 6

Cautions and Considerations. Building Healthy Communities surfaced numerous

When a foundation engages with a PI, it is not a

Philanthropic Intermediaries in this Moment of National Reckoning 7

Adequate Financing. Engaging PIs

However, to be a good partner in those circumstances requires bureaucratic flexibility

Identifying Appropriate Philanthropic Intermediary Partners.

Who has reach? Who has an established constituency?

Philanthropic Intermediaries in this Moment of National Reckoning 8

• Consider PIs as key elements in regional analyses of power building ecosystems

• Facilitate a program staff workshop or series of workshop to discuss selected

Above all, use this moment of disruption of

Philanthropic Intermediaries in this Moment of National Reckoning 9

Philanthropic Intermediaries in this Moment of National Reckoning 10

Philanthropic Intermediaries in this Moment of National Reckoning 11

Program Staff also shared numerous examples from

In some cases, they can come to see these

Philanthropic Intermediaries in this Moment of National Reckoning 12

While communities may have

Philanthropic Intermediaries in this Moment of National Reckoning 13

“A new generation of leaders is

What forms of assistance and what kinds of Philanthropic

Philanthropic Intermediaries in this Moment of National Reckoning 14

Integrated Bold Idea One:

What follows is an exploration of four questions designed to help TCE consider

Philanthropic Intermediaries in this Moment of National Reckoning 15

2. What important functions can PIs perform in support

3. What cautions and considerations should inform

4. Are there specific opportunities for leadership in

Philanthropic Intermediaries in this Moment of National Reckoning 16

In that interpretation, PIs serve the purpose of keeping ultimate beneficiaries at a

Philanthropic Intermediaries in this Moment of National Reckoning 17

• Provides a shared platform for collaboration and collective action.

• Provides an independent check on the power of foundation staff; mechanism for

Philanthropic Intermediaries in this Moment of National Reckoning 18

Rather than as a mechanism to distribute TCE’s power, Philanthropic

Centering Equityx suggests three fundamental questions to assess a PI’s “stance” to

2. Does the PI see its role as strengthening movements or individual nonprofits?

Ultimately, the practice of working with Philanthropic

Philanthropic Intermediaries in this Moment of National Reckoning 19

As long as people seek to organize themselves to accomplish a goal that requires

Instead, they are engaged in exploring a variety of organizational arrangements and

Philanthropic Intermediaries in this Moment of National Reckoning 20

This moment calls for a systematic reappraisal of when and how

Current TCE Philanthropic Intermediary Functions

A good number of TCE’s primary grantee partners are fiscally sponsoredxii,

Philanthropic Intermediaries in this Moment of National Reckoning 21

Community Foundations have proven to be particularly adept regranting partners. When

Philanthropic Intermediaries in this Moment of National Reckoning 22