The Nonlinear Library EA - Public Fundraising has Positive Externalities by Larks
Dec 26, 2023
05:51
Welcome to The Nonlinear Library, where we use Text-to-Speech software to convert the best writing from the Rationalist and EA communities into audio. This is: Public Fundraising has Positive Externalities, published by Larks on December 26, 2023 on The Effective Altruism Forum.
Epistemic status: revealed to me in a dream
Summary: fundraising from the public has positive externalities: it also functions as outreach and red-teaming. If organizations have not taken this into account they may have under-invested in public outreach and should do more of it.
A simplistic approach
Here is a simple model for how a normal organization might think about fundraising:
A: Estimate how much money you expect to be able to raise from fundraising activities.
B: Estimate how useful that money would be to you.
C: Estimate the costs of fundraising (e.g. staff time).
If B > C, do fundraising! If not, skip it for now.
My claim is this is a bad model for EA orgs, because it misses a significant fraction of the benefits.
Field-building benefits
Soliciting donations from the general public is generally quite hard. The skills required to do this are often quite different from those involved in running the organization's core operations, and can be a significant distraction. It is hard to convince people what you're doing is a good idea, and even those who agree often don't donate.
But this is not wasted effort: the difficulty in converting agreement into donations means that fundraisers are effectively subsidizing outreach. The people who read your work but don't hand over their credit card details might be sold on the mission but skeptical of the team… so they donate to another org. Or they might be a student with limited liquid assets but willing to apply for jobs in the space in a few years.
Or they might bring up the idea to their friends, or answer an online poll, or change their vote. Each of these seem pretty valuable - for example, it seems plausible to me that a large fraction of the value of SIAI's fundraising efforts might have come from these channels, rather than via directly increasing SIAI's budget.
Epistemic benefits
Fundraising can also be unpleasant because it opens yourself up to criticism. If you're just doing your own thing with one or two large donors, you have little need to explain yourself to anyone else. You need to appeal to the big foundations, but you probably have a decent idea of what they want, and they're also likely to be pretty busy. Even if they say no, they're unlikely to send you a long message about how you are bad and your organization is bad and you should feel bad.
In contrast, having the audacity to run a public fundraiser naturally invites questions and criticisms from people who are skeptical of your effectiveness and theory of change. These critics have no obligation to represent a single perspective or agree with each other, so you may find yourself being attacked from multiple directions at once.
However, this may be one of the only sources of feedback your org can get, especially if you are small. For the same reasons peer review, flawed as it is, is useful in science, your org can potentially benefit from feedback and questioning and critique of your assumptions, plans and execution.
Fundraising from the broader group of EAs can attract high quality criticism from similarly-minded people; raising from a broader audience could potentially attract feedback from a wider range of perspectives.
There is something of a principal-agent problem here; for the staff, criticism is unpleasant. For the organization, it is a mixed bag, because good criticism, even if harshly worded, can help them improve. And from the perspective of the broader movement it seems very good, because damning public criticism helps avoid grant misallocation. So my guess is that, from an impartial point of view, organizations under-invest in exposing themselves to public scrutiny.
You could think of this argument as being somewhat ana...
Epistemic status: revealed to me in a dream
Summary: fundraising from the public has positive externalities: it also functions as outreach and red-teaming. If organizations have not taken this into account they may have under-invested in public outreach and should do more of it.
A simplistic approach
Here is a simple model for how a normal organization might think about fundraising:
A: Estimate how much money you expect to be able to raise from fundraising activities.
B: Estimate how useful that money would be to you.
C: Estimate the costs of fundraising (e.g. staff time).
If B > C, do fundraising! If not, skip it for now.
My claim is this is a bad model for EA orgs, because it misses a significant fraction of the benefits.
Field-building benefits
Soliciting donations from the general public is generally quite hard. The skills required to do this are often quite different from those involved in running the organization's core operations, and can be a significant distraction. It is hard to convince people what you're doing is a good idea, and even those who agree often don't donate.
But this is not wasted effort: the difficulty in converting agreement into donations means that fundraisers are effectively subsidizing outreach. The people who read your work but don't hand over their credit card details might be sold on the mission but skeptical of the team… so they donate to another org. Or they might be a student with limited liquid assets but willing to apply for jobs in the space in a few years.
Or they might bring up the idea to their friends, or answer an online poll, or change their vote. Each of these seem pretty valuable - for example, it seems plausible to me that a large fraction of the value of SIAI's fundraising efforts might have come from these channels, rather than via directly increasing SIAI's budget.
Epistemic benefits
Fundraising can also be unpleasant because it opens yourself up to criticism. If you're just doing your own thing with one or two large donors, you have little need to explain yourself to anyone else. You need to appeal to the big foundations, but you probably have a decent idea of what they want, and they're also likely to be pretty busy. Even if they say no, they're unlikely to send you a long message about how you are bad and your organization is bad and you should feel bad.
In contrast, having the audacity to run a public fundraiser naturally invites questions and criticisms from people who are skeptical of your effectiveness and theory of change. These critics have no obligation to represent a single perspective or agree with each other, so you may find yourself being attacked from multiple directions at once.
However, this may be one of the only sources of feedback your org can get, especially if you are small. For the same reasons peer review, flawed as it is, is useful in science, your org can potentially benefit from feedback and questioning and critique of your assumptions, plans and execution.
Fundraising from the broader group of EAs can attract high quality criticism from similarly-minded people; raising from a broader audience could potentially attract feedback from a wider range of perspectives.
There is something of a principal-agent problem here; for the staff, criticism is unpleasant. For the organization, it is a mixed bag, because good criticism, even if harshly worded, can help them improve. And from the perspective of the broader movement it seems very good, because damning public criticism helps avoid grant misallocation. So my guess is that, from an impartial point of view, organizations under-invest in exposing themselves to public scrutiny.
You could think of this argument as being somewhat ana...