The Lucky 13—Indian NGOs To Benefit From MacKenzie Scott’s Philanthropy

In a year of unending challenges, Wednesday was a moment of cheer and joyful backslapping for Indian non-governmental organisations. It spilled out on Twitter as several NGOs celebrated grants from billionaire philanthropist MacKenzie Scott. A “staggering” amount as one expert put it.

Scott’s recent, mega giveaway of $2.73 billion spans 286 non-profit organisations, including 13 from India. The money will help post-pandemic relief, smallholder farmers, migrant workers, waste pickers, unemployed youth, women entrepreneurs and several marginalised communities in India at a time of deep post-Covid stress and not enough funds.

The pandemic exposed the public health faultlines in the country drawing the attention of the global philanthropic ecosystem to India's developmental needs, said Atul Satija, chief executive of GiveIndia and founder of The/Nudge Foundation. Both feature on Scott's list and the money is already in the bank. It took just 2 weeks versus the 3-6 months such grants usually take.

"What I’m hoping this does is inspire more and more philanthropists to work closely with non-profits as partners and change the nature of the grants to be more trusting, faster and more strategic," Satija said to BloombergQuint.

Scott, Amazon.com Inc.-founder Jeff Bezos’ ex-wife, is worth an estimated $60 billion after her divorce left her with a 4% stake in the e-commerce giant.

In May 2019, she pledged to give away most of her wealth, saying she had a “disproportionate amount of money to share” and she’d keep giving it away “until the safe is empty”.

Scott’s philanthropy is marked by diversity, size and freedom, as she details in the blogs that have accompanied each round.

In July 2020, racial equity was the cause she put most money towards, while also supporting several others such as LGBTQ and gender equity, public health and climate change. “Unless organisation leadership requested otherwise, all commitments were paid up front and left unrestricted to provide them with maximum flexibility,” she said then.

In December 2020, she said her team looked at 6,490 organizations, and undertook deeper research into 822, before deciding on 384 with “high potential for impact”.

This time, she said the focus was on “categories and communities that have been historically underfunded and overlooked”.

Atleast 13 non-profits in India are on Scott’s most recent list.

• ACT Grants

• Digital Green

• Dream a Dream

• GiveIndia

• GOONJ

• Jan Sahas

• Magic Bus

• Mann Deshi Foundation

• Piramal Swasthya

• Professional Assistance for Development Action (PRADAN)

• SNEHA (Society for Nutrition, Education and Health Action)

• The Antara Foundation

• The/Nudge Foundation

It represents a good mix of primarily grassroot organisations and also a couple of intermediaries, working across fairly diverse causes, Venkat Krishnan, principal trustee at India Welfare Trust, told BloombergQuint.

This is probably the single largest grant made in a single year by a donor to Indian NGOs, outside of their own foundations, said Amit Chandra, a private equity investor and philanthropist.

While individual amounts are not known, the average per organisation works out to $10 million or Rs 74 crore. Digital Green said it will receive an unrestricted $15 million. “It gives us an opportunity to amplify the voices of small-scale farmers around the world,” Executive Director Rikin Gandhi was quoted as saying in a statement.

Chandra estimates some Indian NGOs could have got upto $25 million.

Very few donors give NGOs flexibility to build their organisations, Chandra remarked. One in two NGOs has an income base that is more than 60% restricted, according to Bain’s India Philanthropy Report 2021.

I’m giving 100 bucks. Show me that a child got a pencil box and notebooks worth 100 - is how Satija described most funding. But, whether the books do anything at all to improve learning is a design process and that comes from the organisation’s core capacity. It rarely gets funded, he said. CSR law in India also caps such 'overheads' as do recent changes in the Foreign Contribution Regulation Act.

Scott's money comes with flexibility (law permitting).

The other challenge India’s social sector faces is that of scale - the ability to spend large amounts timely and effectively. Only a handful of Indian NGOs have an annual operating budget of more than Rs 5 crore, the Bain report says citing a study by Ashoka University.

That's probably why Scott’s India list has many established names— experienced NGOs that already have support from a wide variety of donors, ranging from foreign corporate foundations to intergovernmental organisations to Indian family-owned philanthropies.

“Given that the smallest grant is probably around $2 million (Rs 15 crore approx.), it’s but natural that she’s picked some of the more well established organisations,” Krishnan explained.

In financial year 2019-20 private funding of the social sector increased 23% to Rs 64,000 crore, as per the Bain report. But then the pandemic struck.

Already, international non-profit contributions, about a quarter of philanthropic funding in India, had declined by nearly 30% over the past five years, driven by changes in FCRA.

More recently, CSR corpuses have been diverted in large parts to the PM CARES and state relief funds.

But the generosity of individual donors has more than made up for this.

NGOs involved in Covid relief have received more funds than ever before, Satija said. Though, often at the expense of those working in other areas.

As one message on Twitter put it—this MacKenzie Scott gift couldn’t have come at a more important time.