A “new era” of philanthropy is taking hold, one where donors are no longer creating large foundations staffed by many employees but instead joining collaboratives, according to the Bridgespan Group. Today, there are over 500 collaboratives, the majority birthed over the past decade, and last week, Bridgespan released its report, “Collaboratives as a Philanthropic Asset Class,” guiding donors through the questions they need to ask before joining one.

“Collaboratives are a way for folks to pool assets like you would in a mutual fund, to hedge risks, to leverage the expertise of expert advisors and not rely on their own knowledge,” Alison Powell, one of the report’s co-authors and a Bridgespan partner, told eJewishPhilanthropy. “Right now, we have so many challenges we’re facing as a global community that there’s really not time for everybody to build their own individual work.”

There are many reasons for the explosion of collaboratives, Powell said. The partnerships are often community-focused, employing participatory grantmaking and offering an attractive opportunity for donors who may not have experience with issues they care about, but want to help. “If you didn’t want to set up a big foundation, you didn’t want to feel like you had to become an expert on any particular issue, you could get leverage via giving collaboratively.”

Additionally, no donor can combat today’s pivotal issues alone, Powell said. “Increasingly larger institutional foundations are recognizing that even with billion-dollar endowments, they don’t have the resources to solve the problems they’re setting out to solve.”

Collaboratives depend on relationships, experts say, so donors need to be able to communicate what they are looking for, both based on the impact they hope to see and the roles donors play.

“Money really moves at the speed of trust,” Powell said, quoting Stephen Covey, the author of The 7 Habits of Highly Effective People and The Speed of Trust. “The core question is how much control am I comfortable giving up for all the benefits that I get out of participating in a collaborative because there probably will be some aspect of any collaborative that isn’t the center of the bull’s-eye for what you care about. Navigating that tension is the core element that donors have to think about.”

The report offers three sections — Reflect, Engage and Nurture. In the first section, donors are asked to clarify their needs. What kinds of relationships are they looking to attain through the collaborative? Are they an expert on an issue or do they want to learn from peers? What proximity does a donor want to the community they are serving?

The second section asks donors to think about the impact potential and structure of a collaborative. How does the collaborative measure impact? How does it support grantees? How is it governed and how are decisions made?

The third section focuses on the need for investment in the collaborative field overall, pointing to The Gates Foundation, which sponsored the report along with Philanthropy Together, as an example of an organization that has funded research on collaboratives, built a website teaching about collaboratives and helped curate a list of over 300 collaboratives as a resource for both donors and nonprofits.

The report itself was a collaboration between Bridgespan, Strategy for Scale and Jasper Ridge Partners, authored by representatives from each.

While more donors are getting involved in collaboratives, the field has not reached its full potential, Powell said. “If you imagine, in 10 to 15 years, there’s so much potential for more money to be flowing through these collaboratives, but there’s a lot of field building and infrastructure that’s needed.”

Collaboratives can be essential resources for nonprofits, Powell said, because “for recipients, in a perfect world, [collaboratives are] aggregating more capital than they could access individually, and they are opening up their donor set to new donors. In a perfect world, they are also streamlining grantmaking procedures, making [nonprofits’] lives easier… Many collaboratives are providing support beyond the grant. They’re doing [Technical Assistance] provision. They’re doing fundraising support.”

There’s a collaborative for every donor, Powell said, whether they are interested in partnering with others to support the city they grew up in, their home country, the community they love or a cause they are passionate about. There’s even a collaborative for shark lovers.