Aid funding has a few fundamental problems that are inherent in traditional delivery models. These problems are shared by impact investment a well as any other approaches that rely on traditional deliveries. I have often written about there – here, here and here, for example. Essentially, there are three fundamental issues:
- It is hard to see the link between investment and outcomes; Impact evaluations are difficult, take time and can only really be done reliably at scale; Monitoring is tricky and plagued by its own set of problems.
- Attribution of impact is difficult or outright impossible. This is particularly the case for small or medium funding;
- Once an award has been granted/ an investment been made, there is virtually no way for the donor/ investor to track/ manage their investment.
Because of these problems, delivery methods have historically changed very little and the Aid industry continues to be dominated by large, institutional incumbents that roll out the same sort of large, process-driven programs that they have been rolling out for decades. Technology has contributed to some incremental improvements in these models, but fundamentally, they haven’t changed much.
Look into any such program and you are almost certain to find a mix of training/ capacity building initiatives, communication campaigns, dedicated supply chains, plus the obligatory “coordination” and the ubiquitous armies of people filling in forms, inputting forms into machines & forever struggling with versions of similar, buggy, database software built on demand by keen contractors.
We have a tremendous opportunity to change all that. These days it is relatively easy to verify an event the moment it happens – this can be done pretty much anywhere in the world, at scale. This allows us to track impact behavior in real time. We believe we should use this as a platform for entirely new models of impact funding & impact investment.
We just put out a white paper describing how this approach can spark fundamental changes in Impact financing & delivery:
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