Beyond Direct Giving: Flexing With Funding Intermediaries

By: Kaky McGinness Grant, Founder and Principal

“Why would I give to a ‘pass though’ organization rather than make grants directly to the nonprofit organizations?”

As philanthropists tackle complex problems—from improving public education to addressing systemic poverty—asking “how” to give effectively is just as important to ask as “where”, “why”, “to whom” and “how much.”

At Grant Philanthropic Advisors, we support clients who find themselves at a crossroads: they have the philanthropic focused capital and the passion, and they’re seeking localized and/or issue expertise to deploy funds effectively and at scale.

This is where Intermediaries can be a savvy tool in the philanthropy tool kit.

What is a Funding Intermediary?

A funding intermediary is an organization that sits between the original source of philanthropic assets (the philanthropist or their giving vehicle) and the frontline problem solver (the grassroots non-profit or community leader).

Think of them as the connective tissue of the social sector. A funding intermediary is a proactive, mission-driven entity. They aggregate capital from multiple sources and use their specialized knowledge to distribute that money to the organizations and leaders best positioned to make change. They amplify philanthropic dollars by pooling it, deploying it based on expert-led research, and taking on the administrative and operational burden for the donor, making it a mechanism for impact at scale.

Intermediaries’ Critical Role in the Philanthropic Ecosystem

Philanthropists often struggle with a knowledge gap. A donor in New York may want to support girls’ education in Southeast Asia, but they likely lack the cultural context, the network of local leaders, or the ability to conduct rigorous due diligence on small, regional nonprofit organizations.

Intermediaries bridge this gap as critical players in the ecosystem.

Provide Expertise: They employ specialists who live and breathe specific issue areas or geographies. Intermediary teams are composed of experts on community issues, evidence based interventions, and policy.

Research and Explain Complex Data: They study the field and complex issues; they gather data and write reports to educate donors on the landscape and distill effective funding interventions.

Connect Philanthropists: They are a hub for resources and relationships. Philanthropists want to connect with each other and learn from each other’s experiences. An intermediary is a safe place for these conversations. Likewise, the intermediary staff is able to connect effective nonprofit organizations and leaders directly with philanthropists to share their stories of impact.

Identify Innovation: They find hidden gem organizations that are too small or too remote to be on a major foundation’s radar. The staff teams see the big picture and yet, they are able to highlight the effective grassroots players on the front lines.

Shape Policy and Systems Change: Intermediaries are often at the forefront of advocacy and policy reform. By funding a coordinated network of frontline organizations, they gain the collective influence required to push for legislative change and shift public opinion, transforming the conditions that create the problems rather than just treating the symptoms.

Issue Based Intermediaries

The intermediary landscape is diverse, ranging from global powerhouses to niche, issue-based funds. Here are a few examples of effective funding intermediaries:

Blue Meridian Partners Nancy Roob (formerly of the Edna McConnell Clark Foundation) and investor Stan Druckenmiller were the creative minds behind Blue Meridian. They designed it to solve a specific problem: helping young people and families break the cycle of poverty. They saw that many effective non-profits often get stuck in a cycle of small grants. Blue Meridian pools capital from dozens of mega-donors to provide massive, $100M+ growth capital grants to help poverty solutions scale nationwide.

Co-Impact Founded by a group of the world’s leading philanthropists—including Jeff Skoll and Richard Chandler—Co-Impact acts as an intermediary that identifies proven systems-change projects in the Global South. It allows other donors to participate in high-stakes global development without needing their own local offices in Africa or Asia.

The Audacious Project This intermediary was co-founded by Sir Richard Branson (Virgin Unite), Chris Anderson, and partners like the Skoll Foundation and Dalio Philanthropies. It acts as a talent scout for the most ambitious ideas in the world. Once a project is vetted, the intermediary brings a group of donors together to fund it collectively, often raising $50M–$100M for a single organization in one night.

Omidyar Network The founders of eBay, Pierre and Pamela Omidyar, moved away from the traditional private foundation model to create a philanthropic investment firm. The Omidyar Network acts as an intermediary that uses both grants and for-profit investments to support market-based social change. They have incubated several other intermediaries and spin-off funds focusing on digital identity, financial inclusion, and government accountability.

Open Philanthropy The co-founder of Facebook/Asana Dustin Moskowitz and his wife, Cari Tuna, started Good Ventures, but they realized they needed a more robust research engine to find high-impact giving opportunities. They co-founded Open Philanthropy (initially with GiveWell) which now acts as a massive research and grantmaking intermediary. 

Community Foundations as an Intermediary

A community foundation is, in many ways, the original place-based intermediary. They offer a hyper-local lens that global, or even national, intermediaries often lack. Increasingly, large national foundations use community foundations as their local boots on the ground. A community foundation acts as an intermediary that:

Interprets Local Nuance: They understand which local non-profit in specific neighborhoods are effective and in which focus areas.

Builds Trust-Based Bridges: They have decades-long relationships with local leaders, allowing them to get capital into community-led projects that a national donor might never find through internet or AI research.

Curates Field-of-Interest Funds: A donor can say, “I want to support affordable housing and neighborhood building in Eastside Atlanta,” and then step back. The foundation uses its staff expertise to select the most effective nonprofits working in this space each year.

How Grant Philanthropic Advisors Engages with Funding Intermediaries

At GPA, we work with our clients to create a giving strategy. We see funding intermediaries as specialists who can execute specific, complex parts of our clients’ vision. We provide an unbiased conduit between a philanthropist’s high-level vision and the specialized expertise that an intermediary provides.

Here is how we specifically work with funding intermediaries:

Right Tool Assessment: Not every philanthropic strategy requires an intermediary. One of our jobs is to help a donor decide how they should give. Is direct giving to a portfolio of nonprofits the right choice or should they utilize an intermediary? Or is it a hybrid approach? We recommend an intermediary when a client wants to:

• Enter a new or complex field where they lack internal expertise.
• Scale their impact by pooling funds with other high-net-worth individuals.
• Support grassroots movements that are difficult to find or vet from a distance.

Vetting and Selection: There are hundreds of intermediaries. GPA performs the due diligence that a philanthropist might not have the time to do. We evaluate:

• Power Dynamics: Does the intermediary empower local leaders, or is it a top-down organization? We assess their governance model, looking critically at how decisions are made, and if their board and staff reflect the communities they serve. A truly effective intermediary is not a distant funder but a trusted partner that practices trust-based philanthropy, minimizing bureaucracy and maximizing local autonomy.
• Financials: Are their overhead costs reasonable for the level of service they provide to grantees? We move beyond simple overhead ratios to evaluate the efficiency of their spend. 
• Strategy: How does their theory of change align with our client’s philanthropic strategy? We deep dive into the intermediary’s logic model. This involves scrutinizing their measurable goals, the evidence base for their chosen interventions, and their definition of long-term success. 

Portfolio Integration: We help donors treat an intermediary as one slice of their broader philanthropic portfolio. For example, a client might use their private foundation for local scholarship giving but use a major global intermediary to handle their international or systemic-change giving. We ensure these different engines of giving are working in harmony toward a single goal.

Intermediaries | Part of your Strategic Philanthropic Portfolio

Funding intermediaries can be a critical piece of a philanthropist’s comprehensive portfolio to help realize their vision for social change. Each function of an intermediary—from the rigorous due diligence and deep issue-area expertise, to the ability to pool capital for systemic change, to connecting with like-minded philanthropists, and the handling of complex assets—can amplify a savvy philanthropist’s impact. By engaging an intermediary, philanthropists gain the precision of a specialist with the agility of a lean operation, allowing them to focus on realizing their goals.

About Grant Philanthropic Advisors:
We’re an independent firm helping clients to focus and maximize their philanthropy—in turn, strengthening the fabric of our communities. Founded in 2019, we help donors move from responsive patterns of giving by assisting clients to identify values and become more strategic in their philanthropy. Our goal is to help donors to become more effective as change-makers. We work with foundations (large and small staff teams), donor advised fund holders, multi generational families, individuals, philanthropy supporting organizations and corporations to design philanthropic strategies.