Starting Your Philanthropic Journey? Avoid These 5 Mistakes

So, you’re ready to take the leap into philanthropy, channeling your resources and leadership skills to create meaningful change. But here’s the reality: even the best intentions can lead to missteps. Like any strategic endeavor, philanthropy has its own complexities—and knowing what to avoid is as critical as knowing where to focus.

Drawing on insights from The Business of Philanthropy, a publication emerged from a series of thought-provoking conversations with over 50 prominent figures across business, philanthropy, and social sectors, and explores the evolving landscape of philanthropy, here are five common mistakes new philanthropists make – and how to dodge them.

1. Focusing on Short-Term Results Instead of Long-Term Impact

It’s understandable to want to see results fast—who doesn’t love instant gratification? But focusing too much on quick wins can actually stop you from making long-lasting improvements.

In the words of David Miliband, CEO of the International Rescue Committee (IRC): “There are some great things about Western philanthropy, but too often, it’s short-term, boutique, and with a premium on novelty rather than a premium on scale; a reinvention of the wheel rather than taking the wheel to more places.”

To shift your focus to longevity and reach, ask yourself two simple questions: How will my initiative still be making a difference 5 or 10 years from now? Who can I partner with to extend its life and impact?

2. Not Giving Locals a Seat at the Table

A big mistake many philanthropists make is thinking they know what’s best without asking the very people they’re trying to help. To create real change, you must listen:

• Involve Beneficiaries in Decision-Making: Whenever possible, include community members in your decision-making processes. This not only empowers them but also provides critical insights.
  
• Build Relationships with Local Leaders: Engage directly with community leaders who know the issues firsthand and understand the local context best.

• Create Feedback Loops: Set up regular check-ins with people on the ground to gather their input, then make adjustments as needed. This will keep your efforts aligned with the community’s evolving needs.

3. Underestimating the Complexity of Issues

Solving problems in today’s world is anything but simple. Environmental concerns have been compounded by extreme heat, wildfires, and floods. Social issues have arisen from war, conflict, migration, humanitarian catastrophes, inequality, and racism. Economic pressures are ballooning from inflation, global debt, and unsustainable growth.

Philanthropists must begin their journey understanding that the solutions, like the problems, will never be simple.

4. Going It Alone Instead of Building Partnerships

Yes, there’s an allure to taking ownership of a problem. But going it alone will only kneecap your efforts. As Darren Walker of the Ford Foundation puts it:

There’s no doubt that philanthropists are collaborating more because we realize that the complexity of the world requires our collective resources. There’s no problem the Ford Foundation is working on that we alone can solve. The Gates Foundation alone cannot solve the challenges it’s working on, even though it’s the largest foundation in the world. So, we must collaborate.

When we come together for the greater good, we must put our individual egos and logos aside and allow the ideas to drive discussions about how we invest. I think that humility is required to engage in some of the big problems we’re dealing with in the world today.

One of the smartest moves you can make is teaming up with others. By collaborating with other philanthropists, nonprofits, or even local community groups, you can amplify your impact and ensure resources are used wisely.

5. Failing to Institutionalize Giving

Many new philanthropists jump into “reactive giving” without thinking about how it will continue beyond their initial enthusiasm. Setting up a trust, endowment, or structured giving plan—even if it’s modest—can make a world of difference in ensuring your contributions have a lasting effect.

As Fady Jameel, vice chairman of Community Jameel, explains:

I think it’s very important to set up a trust or an endowment, however small, to start with. It’s important to institutionalize that for the future. Families want things to last for a long time. Longevity is important. Maybe it’s difficult to set up a foundation, but you can set up an endowment and build on it so you have that continuity.

Sustainable giving isn’t about the size of the gift; it’s about making sure your support continues to make a difference, even if your personal circumstances change.

Looking forward

By avoiding these five common mistakes, you can set yourself up to make a lasting impact. Remember, philanthropy is a marathon, not a sprint. It requires patience, humility, and a willingness to learn and adapt. When done thoughtfully, your efforts will create meaningful change that lasts for generations.rn and adapt. When done thoughtfully, your efforts will create meaningful change that lasts for generations.