When we set up the Collaboration Circle last year, a driving motivator was to make it easier for funders to combine their resources by pooling funds. The simplest way we’ve used to describe pooling funds is where funders put their resources into a shared pot. Money is usually distributed based on a set of agreed priorities, and by working in this way, funders can collaborate, share risks, and increase the impact of their investment, often focusing on strategic, long-term, or complex social issues. 

A report last year from JRF explored the benefits of pooled funds in more detail, and learning like this together with other examples across the globe has helped inform our approach with the Collaboration Circle. JRF identified several motivations for funders to engage in pooled funding which resonates with our own experience, including the desire to re-distribute power, foster collaboration, and promote more equitable grant-making practices. While pooled funds offer significant potential for innovative and collaborative philanthropy, the report also pointed out some of the challenges that must be fully addressed to realise their benefits – including inadequate resourcing and power dynamics among funders. 

I joined the Collaboration Circle team as a Knowledge Transfer Associate from London Met University, and it’s my job to bridge the gap between academic research and practical implementation. For the Collaboration Circle, this means translating academic insights to help develop innovative financial models and governance frameworks so that we can better manage pooled funds. As part of this work, I recently reviewed the current landscape of pooled funds. What are the common lessons we can draw on? Are there similarities when it comes to the structures used to distribute these funds? What trends should we be aware of? These are some common lessons that have emerged, which are identified below.

Increased collaboration among funders

Our review highlighted how organisations are increasingly looking at how they collaborate to make the best use of their time, money and expertise. It has been well documented how much demand for funding has increased over the recent months. Pooling funds offers a practical way to combine resources and work collectively so that funding can go further, as well as reduce the burden on funded partners.  

London Funders saw the direct benefits of increased collaboration through the London Community Response (LCR) fund, which brought together 67 funders to distribute over £57m during the covid-19 pandemic. Some funders aligned their funding, but a significant proportion chose to pool. The London Community Response showed the power of funder collaboration—by working together, we moved faster, reached further, and supported communities more effectively than any of us could alone.

Pooling funds can help address global issues

At a time when we’re seeing the acceleration of global challenges, pooling funds can help address issues that individual funders might not have the capacity to tackle alone. From our review, pooled funds are especially common in areas such as:  

• Climate action  

• Global health and pandemic response  

• Gender equality and social justice  

• Economic development  

My review highlighted several examples from across the globe of pooled funds tackling these issues at scale. The world’s largest climate fund and combines contributions from developed countries party to the UN Framework Convention on Climate Change (UNFCCC) as well as public, non-public, and alternative sources. Collaboration has, they say, led to “unprecedented coalitions between private investors, development agencies and civil society organizations to achieve transformative change”.

The Joint Gender Fund (JGF) is another example of a collaborative funding initiative to address gender-based violence (GBV) in South Africa. JGF provides an opportunity for donors to pool their resources and a mechanism through which funds can be disbursed. The fund involves cross sector funders and civil society groups, providing ‘a unique space that recognizes that different relationships between civil society and government is required for increased effectiveness in the response to gender based violence’. 

Flexible and adaptive funding

Pooled funds often allow for a flexible approach to funding, where strategies can evolve based on changing circumstances or emerging needs within a funded issue area.  

A notable example of this adaptability can be seen in the UN Central Emergency Response Fund (CERF). CERF provides rapid financial assistance to humanitarian crises, allowing resources to be deployed quickly in response to new or escalating emergencies. Its flexibility ensures that funds can be redirected to where they are most needed without being restricted by rigid donor requirements. Another example is The Global Fund to Fight AIDS, Tuberculosis, and Malaria, which has a "catalytic investment" model that allows for reallocating funds based on changing epidemiological trends. This model enables resources to be redirected to priority regions or populations when new challenges arise, ensuring more effective and timely interventions.  

What does this mean for the future? 

Reviewing some of the international models has also highlighted some of the approaches and innovations which we hope to explore with the Collaboration Circle. There are, for example, pooled funds with Long-Term, Multi-Year Funding Commitments for initiatives targeting systemic change. Multi-year commitments help organisations plan effectively and sustain projects addressing structural issues. Other pooled funders are intentionally targeting investment in ‘High-Risk, High-Reward Funding’, where money is designed to support innovative solutions and high-risk projects that offer potential for transformative impact. In some cases, a portion of funds can be dedicated to experimental projects which might be considered too high risk for traditional funding programmes.  

Other examples also tell us more about the structure and governance of pooled funds which is something we’ve been really interested in when developing the Collaboration Circle. We see in many examples a commitment to transparent and inclusive governance, that enables stakeholders and communities to participate in decision-making. Our review highlighted other examples of how pooled funds have implemented this ambition: through advisory committees with community and sector representatives, adoption of participatory grant-making approaches and full transparency around the allocation and impact of funds.  

We’ve gone one step further by building in more inclusive and equitable practice at every level of the Collaboration Circle. Its Executive Board is drawn in equal number from funders and equity-led civil society organisations, and each pooled fund which is hosted by the Collaboration Circle will also bring funders and civil society together through its funding committee and operational teams (you can read more about how it works in practice here). As part of my role, I’ve been exploring different aspects of how we operationalise this model, looking at everything from how we create a shared learning culture, down to possible secondment models so that civil society members are able to participate alongside funder partners.  

My work so far has shown that there is valuable learning and evidence to draw on as we shape our work on the Collaboration Circle. We’re uncovering valuable insights through our Knowledge Transfer Partnership on how to create an environment where pooled funds can truly thrive. If you’re interested in what we’re discovering and where we’re headed, let’s connect—we’d love to share more!