Delivering basic services is the responsibility of governments; nonprofits must build collaborative partnerships to leverage government reach in order to address social problems at scale

Yasmin Madan, Director at Co-Impact, highlights that the mandate to provide basic services enabling people to lead fulfilling lives sits with government.  

“We recognize that basic needs like health, education, and chance at livelihoods should be met by governments, and how does philanthropy show up in support of that.” – Yasmin Madan, Director of Co-Impact.

Public service systems – health, education, economic opportunity – need to serve millions of people. At this scale, innovation is hard and inequity is common. For nonprofits, the reach of government represents a powerful opportunity to create impact at scale, using its infrastructure to scale solutions that solve pressing social problems and change how existing systems operate. To do this, they must build constructive partnerships with the state, facilitating the adoption of innovative solutions and system changes that align with governments’ plans and wider priorities.  

There are multiple strategies for ‘scaling with governments’; implementers need to choose their strategy based on what is required for quality implementation, and the readiness of governments to fully own solutions

Scaling with government is a critical pathway to scale, yet this can mean many different things. According to Spring Impact’s latest research into funding models for impact at scale, strategies can range from building the capacity of government institutions to embedding solutions into existing national or regional programmes; to nonprofits delivering services themselves with government funding.   

Governments aren’t monoliths and a cookie-cutter approach will not work. Nonprofits must navigate government structures and priorities, tailoring solutions to align with governmental frameworks while addressing implementation gaps. Governments work differently in different contexts and regions.

Lisha McCormick, CEO of Last Mile Health, shared their experience working in Liberia. There, they found out that the fragmentation and poor coordination of financing was one of the biggest impediments to governments’ ability to deliver inclusive, integrated healthcare to their constituents.  To enable more effective and equitable delivery of health services, Last Mile Health works with governments and donor partners to align funding at the global and national levels.

Nonprofits will likely need to play an active role in supporting government to adopt a solution for many years; ‘exit strategies’ could be a long way off

Many nonprofits have ambitious goals of handing over full ownership and funding of a solution to the government, however, this takes a long time to achieve. When governments ‘adopt’ a solution, organisations typically need to play an ongoing support role, driving innovation and holding governments to account for quality implementation. Aparna Hedge, founder of ARMMAN, mentioned their experience working with the Indian Government and how they kept involved in providing technical assistance for innovation, quality, and equity in delivering their solution.

The panel discussed that while there are inspiring examples of governments successfully funding and delivering solutions effectively at scale (as captured by Harvard Business Review), this endgame scenario requires the right combination of supporting factors. Nonprofits must adopt a long-term commitment, supported by long-term funding, and focus on working through systems, rather than compensating through direct service delivery alone. Balancing immediate needs with long-term systemic change poses a real challenge, demanding innovative funding models and agile strategic planning. 

Long term philanthropic funding is almost always needed to get there; although government funding may eventually come, philanthropic funders play an important role

Despite the urgency of scaling health solutions, nonprofits face significant funding challenges. 

Spring Impact’s research study shows that mission-driven organisations operating at scale have, on average, three different payer types, with an average of 63% of funding coming from philanthropy. However, philanthropic funding is often too short-term in nature and comes with constraints, preventing non-profits from investing in organisational strengthening and innovation.

While non-profits might not be often funded by governments directly, their solutions potentially influence policy and could unlock domestic funding for implementation; for example, adding more Community Health Workers to the government payroll instead of making the non-profit pay for them. 

Lessons for funders on how to support organisations to create systems change alongside governments

Philanthropic funders are increasingly aware of the challenges nonprofits face in scaling health solutions, and can consider the following insights in developing their approaches.

• Funders must align with organisations’ strategies and enable systems change work.

“If funders get behind the vision of the non-profits, and if the non-profits are focused on making systems more effective and inclusive, then the systems will serve the people. If we bypass this logic, then we have temporary solutions but not systemic change for sustained impact.”. –  Yasmin Madan, Director and US Lead for Philanthropic Collaboration at Co-Impact.

• The most impactful funder-nonprofit relationship is long-term and flexible, and prioritises learning over planning and purpose over advancing the funder’s own strategy.

“It can take about 10 to 15 years before you harvest the fruits of systems change work. However, even in the best scenarios, philanthropic funding commitments are no longer than 3 to 5 years. This also happens because funders lean towards investing in solving high-visibility issues, while helping organisations to build internal strengths is often not in scope.”—Tom Kagerer, LGT Venture Philanthropy Partner.

• Funders should advocate for their partners to support them to bridge funding gaps post-grant, ensuring sustained impact beyond philanthropic support. Tom Kagerer from LGT Venture Philanthropy highlighted that strategies to mitigate funding cliffs include lowering implementation costs over time and fostering resource mobilisation teams.

We all know that collaboration between governments, nonprofits, and philanthropic funders is essential for scaling solutions and addressing systemic challenges. These panellists have demonstrated what is possible when you successfully balance systems change alongside immediate service delivery, align with governmental frameworks, and foster long-term, flexible funding relationships. The journey demands patience and commitment, but the potential for transformative impact is immense.