What Atlantic Philanthropies Learned Spending Billions Faster Than Any Fund in History

The Atlantic Philanthropies’ four-decade-long story can be summed up in six words: big bets for a better world.

That’s just the way its publicity-shy founder, 85-year-old Chuck Feeney, wanted it. When Atlantic turns out the lights and closes for good in 2020, it will have made history as the largest foundation to complete its giving in the donor’s lifetime, quietly pumping nearly $8 billion into organizations focused on education, science, health care, aging, and civil rights in the United States, Vietnam, South Africa, Ireland, and elsewhere.

Atlantic also stands out for its audacious investments. Nearly 60 percent totaled $10 million or more (individually or in clusters focused on one theme). Of those big bets, 30 percent were aimed at direct social change (with the balance going largely to institutions such as universities and hospitals).

Many of Atlantic’s big bets have achieved significant results, offering lessons the foundation is eager to share.

“We hope Atlantic’s experiences show other donors how they can make big bets of their own to make lasting impact and achieve progress toward solving many of today’s pressing social problems,” says Chris Oechsli, the fund’s chief executive.

To bring those lessons to light, Atlantic commissioned the Bridgespan Group to analyze its track record. We identified 150 investments that met our definition of a big bet: $10 million or more to a single organization or a focused project. Ultimately, we selected 25 from which to learn, choosing those that yielded significant impact and had sizable scope and significance.

Our analysis revealed four lessons for donors seeking to make big bets:

Pick distinctive investment spots and gaps in the funding landscape.

Some of Atlantic’s most effective big bets took advantage of a specific point of leverage for achieving the desired change, often one where large investments had not yet been made.

The foundation placed one of its biggest bets on building university research institutions in Ireland. The Program for Research in Third-Level Institutions sought to transform Ireland from a place where the biggest export was its own people into a leader in Europe’s modern knowledge economy.

Over the years Atlantic invested $176 million to build strong university research departments in the sciences, social sciences, and humanities.

The results have been impressive. An independent assessment of the program in 2011 found many benefits, including “a threefold increase in the human-capital research base” and at least $1 billion over five years in commercial transactions spurred by university researchers. In 2014, the European Commission noted that Ireland has turned itself “into one of Europe’s top innovation nations.”

Support strong leaders and organizations — including with unrestricted funds — to improve nonprofit operations.

Seeking to build a stronger and more professional nonprofit sphere in the United States, Atlantic identified a group of leaders who could launch or build organizations and projects to serve and strengthen charities. It made large, long-term investments in these leaders and their organizations, typically with unrestricted or lightly restricted funds.

For example, Atlantic invested in the Urban Institute to help that group’s National Center for Charitable Statistics create an objective picture of the size and scope of the nonprofit world, based on charities’ Internal Revenue Service filings.

Atlantic also gave unrestricted grants to GuideStar to make nonprofit data and analysis accessible to donors, beneficiaries, policy makers, and others.

By identifying knowledge gaps, and by betting on a set of strong leaders with visions for filling the gaps, Atlantic was a major player in professionalizing the nonprofit world.

Pursue advocacy in a complex policy and legal environment.

Atlantic was willing to take risks on complicated, contentious issues, including funding organizations engaged in direct advocacy, to “promote the voice of the most vulnerable and hold government accountable,” as the foundation put it.

To name one notable example: For more than a decade, Atlantic has supported the campaign to abolish the death penalty in the United States. To that end, it has spent nearly $59 million to build a framework for change, much of it through the Proteus Fund, a human-rights organization.

Atlantic also backed anti-death-penalty work through its Advocacy Fund, a 501(c)(4) entity. That designation status allows the fund to support a wider range of advocacy activities — including direct lobbying, ballot initiatives, and voter mobilization — than the 501(c)(3) structures used by most foundations.

Though its ultimate goal has yet to be achieved, Atlantic has made progress. Since 2007, seven states have abolished capital punishment, thanks at least in part to campaigns funded by the foundation. Four other states have put formal or informal moratoriums on further executions.

Give with the foundation’s end in sight and sustainability in mind.

Atlantic attempted to give with a clear idea of how its own spending patterns could spur greater giving in the future, knowing it would not exist forever.

The $80 million investment Atlantic made in Vietnam’s primary-health-care system illustrates how a donor can increase the odds of sustaining and even expanding impact beyond its investment horizon.

Atlantic designed an investment strategy that brought together a range of players: national leaders and policy makers, key regional leaders, and public-health specialists; institutions such as provincial hospitals and Vietnam’s main school of public health; and international partners.

Evaluations of that effort have found evidence that the health of Vietnam’s residents has measurably improved. And, validating Atlantic’s original plan, government money — regional and national — is flowing into community health projects. A 2011 independent evaluation noted, “The financial commitment by Vietnam’s central government reflects a degree of political and monetary endorsement that bodes well for further replication.”

Atlantic also derived several important lessons from the challenges and failures it experienced over nearly four decades of grant making. Bridgespan found that the grant maker could have:

• Devoted even more of its big bets to social change and focused its efforts over longer time periods. approached due diligence more rigorously at times.
• Been more careful in the few instances it made big bets with approaches that diverged from its typical style.
• Offered additional, complementary investments when it made ambitious capital grants. That money would have better ensured that new buildings would meet their potential to transform scientific discover, health care an more.

In 2012, when Atlantic began to finalize its plans to close, it designated a large pool of funds to capitalize on its achievements and demonstrate lessons it learned along the way.

It’s too early to assess the impact of these final grants, but the approach reflects Atlantic’s faith in making big grants in a short time to help our world deal with urgent challenges. The foundation’s willingness to show everyone else what it learned, and where it failed, could be one of its most enduring legacies in a field that too often keeps such information closely guarded.

Alison Powell is senior director for philanthropy in the Bridgespan Group’s San Francisco office.