2021 Allocation to GiveWell Top Charities: Why We’re Giving More Going Forward

In this post, “we” refers to Good Ventures and Open Philanthropy, who work as partners.

As we wrote last week, we’re substantially growing our overall giving in Global Health and Wellbeing, with the bar in that broad portfolio continuing to be set by the cost-effective, evidence-backed charities recommended by GiveWell. (As most of our readers know, Open Philanthropy started off as a project of GiveWell.)

Today we are excited to announce our largest-to-date support for GiveWell’s recommendations: $300 million for 2021, up from $100 million last year, with tentative plans[1] to donate an additional $500 million per year in 2022 and 2023.

Like last year, some of this new $300 million has already been allocated to specific recommended charities, and some will be held in reserve until GiveWell ​​has more information about which charities have the greatest remaining need for funds.[2] Grants we’ve already made or are planning to make imminently include:

This list reflects GiveWell’s impressive progress in identifying more cost-effective giving opportunities: none of these individual programs at these organizations had received funding from GiveWell prior to this year, and four of the five of the organizations and three of the four interventions are new to GiveWell overall.

As funds are distributed from this year’s $300 million allocation, they will be listed in our grants database.

The rest of this post gives more context on our reasoning for the decisions above, structured as a Q&A.

Why are you giving more than in previous years?

Based on the framework we explained last week, we’re giving more going forward because of:

Much more technical detail on the interplay of these factors is available in our previous post.

Will GiveWell distribute all $300M this year?

No, we don’t expect them to. When combined with projected growth in donations from other donors, our increased allocation means that GiveWell expects to roll over roughly $100 million of funds raised this year into next year to grant in 2022. From GiveWell’s blog post:

We aim to find and fund around $1 billion of highly cost-effective giving opportunities annually by 2025. There’s an enormous amount of good that we can accomplish with our team and donors, and we’re excited to take on this ambitious challenge.

Our confidence in our ability to increase the amount of cost-effective funding we find—and our rapid growth—is driving some changes this year. While we could spend all of the funding we expect to raise in 2021 on opportunities now, we don’t think we should. We plan to roll over about $110 million (~20% of our forecasted funds raised) into 2022 because we expect the opportunities this funding would be spent on now are much less cost-effective than those we expect to find over the next few years.

There are tradeoffs to using funds later, but we think they strongly favor waiting for better opportunities. Our core mission is to help donors maximize their impact, not to get funding out the door as quickly as possible.

We expect GiveWell will likely be in a similar situation of rolling forward a meaningful amount of funding next year into 2023, but we nonetheless plan to increase our funding further.

Why are you committing so much in advance?

In addition to GiveWell’s reasoning above, we see several practical arguments for exceeding GiveWell’s already-identified opportunity set and publicly articulating our tentative expected giving to their recommendations in future years:

  1. [1]

    We would not increase or decrease relative to the planned $500M/year level just because of modest fluctuations in GiveWell’s fundraising from other sources, but we could revisit either direction if there were material updates to our available assets, our “bar”, or other opportunities we discovered.

  2. [2]

    Last year, $70 million was allocated ~immediately, and $30 million allocated in ~January. This year’s planned rollover is both larger in scale and also longer in duration. Additionally, we expect to defer to GiveWell more fully in terms of which organizations the rolled-over funds are distributed to. This includes a commitment to distribute the allocated funds to GiveWell’s recommendations.

  3. [3]

    The total amount granted will be a function of the amount needed for the incentives as the program is implemented.

  4. [4]

    We’re also changing the internal approval process for these grants to have a stronger presumption of deference to the GiveWell recommendations, and aiming to move to more of an annual review (rather than grant-specific) process for deep engagement.

  5. [5]

    For example, consider a scenario in which GiveWell discovered that they had $5B rather than $500M of annual room for more funding (RFMF) at our bar. We would interpret that as suggestive evidence that we should expect to find lots of cost-effective opportunities in our non-GiveWell Global Health and Wellbeing (GHW) grantmaking. If we just filled everything GiveWell discovered at a fixed bar, then our annual GiveWell support would increase so much that we wouldn’t have much funding available for other GHW grantmaking. Under our new approach, we would instead just support $500M of these GW recommendations, and then have resources left over for the highly-effective opportunities we’d expect to find elsewhere, while also revisiting the bar in the future. If, on the other hand, GiveWell could only find $200M above our bar, it’d be more likely that we would need to lower the bar rather than only wanting to give $200M, and the near-term funding plan would give us time to adjust. We think it’s valuable to allow the bar, more than funding amounts, to move flexibly in the near term, though we would expect to shift allocations in the long term in response to major updates.

  6. [6]

    While this new model means that marginal contributions this year are likely to effectively be disbursed in future years, we do not think that effective delay mechanically reduces the total nearterm support for GiveWell charities (whereas it could plausibly do so if we hadn’t made plans for future funding levels, since we could have just given less in response to GiveWell having more savings; see discussion of funging here). As noted above, our planned near-term support of GiveWell (i.e. $500M/year) will not change mechanically in reaction to modest positive or negative fluctuations in GiveWell’s fundraising from other sources, and part of our goal with articulating plans fairly far out in time is to mitigate concerns about mechanical funging for GiveWell overall. Our proposed structure limits how much other donors should expect their marginal funding to GiveWell top charities to cause a reduction in ours, though not necessarily to zero (since over the long run GiveWell’s expected funding from other sources could affect our calculation of our bar).