Overview

    "We have learned to create the small exceptions that can change the lives of hundreds. But we have not learned how to make the exceptions the rule to change the lives of millions." 
                              — Lisbeth Schorr, Social Analyst

Despite all the important work accomplished by nonprofits over the last hundred years, significant growth or scaled impact has remained an elusive goal for most of them. The inability to achieve scale – that is, to make a meaningful and sustainable impact by serving large numbers of those in need of assistance – has limited the potential of these organizations and the people they serve.

If our society is unable to consistently scale its best social solutions to reach millions of people, it is hard to imagine how it will achieve major social progress. Failing public schools, entrenched poverty, and the lack of accessible, affordable, high-quality health care are all indications of our unmet social goals. 

Growth Capital

A primary cause of the failure to reliably scale social solutions remains a lack of accessible growth capital. Capital is not yet consistently allocated to evidence-based, high-performing nonprofits. 

For businesses in the for-profit sector there exists a mature system to vet, select and support growth of promising midsized companies. Yet no such capital market system exists in the social sector that enables the efficient aggregation of large amounts of capital required to finance expansions. 

Marketplace Need

Reliable funding is needed to achieve scale, but the amount of capital required for scaling efforts is too much for any one funder to provide. What is required is a collaborative funding system that consistently brings together capital providers to co-fund major expansions of proven initiatives- i.e. a growth capital marketplace.

Marketplace Impact

The Exchange believes the establishment of a growth capital marketplace will transform the social sector by efficiently allocating growth capital to effective, evidence-based initiatives. A marketplace with thousands of funders co-funding scaling efforts will allow expansion-ready NPOs to access the capital they need to spread their programs on a mass scale. Such a marketplace system will enable:

• Improvements in the lives of millions of individuals and families
• High-impact programs and practices to be spread faster and more widely
• Efficient allocation of capital and large savings from fewer reinventions
• Increased flow of capital to the nonprofit sector and to proven programs
• Widely adopted best practices that improve quality and efficiency