Evaluating grassroots projects requires investment- grade due diligence showing evidence that each initiative has a successful track record of performance—that it not only shows “need” but also demonstrates “proven results.” Based on analysis of results from grants placed, we have found that there are a number of key performance indicators that predict results. The first is track record. While past performance does not guarantee future results in investing, past performance is a strong predictor of future results in philanthropy. Other key indicators are sustainability and scalability of the intervention, existence of thorough project plans with well-defined performance measures, and risk management planning. Project leaders themselves are strong indicators of future performance, all able to be measured through demonstrated experience, demonstrated commitment to power sharing and training of others, and extent of networking to other implementers. Nearly 80 percent of projects evaluated and funded over the past five years using this methodology met or exceeded their stated numerical project objectives.

In the past year, for example, donors via Geneva Global placed nearly a million US dollars in grants related to tsunami relief. These contributions, distributed across more than 20 grassroots projects, will deliver trauma counseling to more than 60,000 affected individuals (a response many commentators noted was drastically underfunded), restore incomes of more than 9,000 people, and provide medical care to more than 30,000 people. This does not include additional benefits like rebuilding 500 homes and immediate aid such as access to clean water and food. At an even more micro scale, one US$40,000 grant provided medical care to more than 4,000 people, trained 200 families to grow vegetables for themselves in temporary housing camps, and provided therapy to hundreds of surviving children who were displaced. In contrast, the total US$14 billion provided by governments and private aid agencies has thus far provided medical care and temporary housing to approximately 800,000 displaced people and rebuilt approximately 20,000 homes. There is a stark contrast in the cost/benefit ratio of these two sets of figures.

Performance philanthropy has additional benefits. Not only does it maximize results; it also encourages additional investment. When donors are able to follow their money and understand the direct results of their generosity, they become much more committed to the philanthropic process. These committed and involved donors help to energize and expand the field of giving.

The marriage of measurable results and more committed donors is why performance philanthropy is so convincing as a viable strategy for reducing chronic global poverty and its related consequences. According to the World Bank, half the world’s 3 billion people live on less than US$2 a day, and 1.3 billion people––20 percent of the world’s population—live on less than US$1 per day. These figures, despite hundreds of billions of dollars of traditional philanthropy, keep growing. The number of people living on less than US$2 a day grew by 300 million in the last 20 years.

Our experiences show that there are many willing to enlist in the noble campaign to end poverty on our planet. Unfortunately, most charitable giving stays inside the wealthiest countries. In the United States, which accounts for the majority of private philanthropy worldwide, less than six percent of monetary giving leaves the United States. Even using the Hudson Institute’s liberal calculations that include volunteer time and other forms of giving, the total is still less than eight percent. All data indicate similar statistics in other developed nations. A leading reason for this disparity in need and giving has been the lack of reliable, independent information and confirmation that donating abroad actually impacts those who need help the most. Western private donors give great weight to risk and return on investment. When allowed to apply investment strategy to philanthropy, they respond. This is evident in the growing number of givers applying similar philosophies, in the growth of for-profit microcredit investment funds, in the concepts behind the Millennium Challenge Account, and at the most prosaic level, in the 100 percent compound annual growth rate of grants placed through Geneva Global.

Giving blindly perpetuates the status quo of poverty in the world. This need not be the case. Much can be accomplished with relatively modest sums when giving is invested in results rather than need only. Philanthropists must demand nothing less than real, meaningful and measurable life change for those they seek to help.