The world of private philanthropy may be in for a period of large growth. News of Coefficient Giving increasing their funding for GiveWell to one billion in the near-term, and the general growth of the effective giving community as reported by Giving What We Can, make it difficult for even hardcore sceptics (and I probably count myself among this curmudgeonly crowd) to stick to the view that we are in business as usual.

There are many reasons to believe that this expected growth will happen, and I’d be remiss to not mention Nan Ransohoff’s great piece on the matter. This article was a catalyst. Where before board members and execs who were particularly clued into the Bay area may have expected to see this change in the size of the giving market, Nan’s piece gave this a name and salience. The third wave of philanthropy materialized slowly, and then all at once.

This possibility of increased funding has now taken the shape of a near certainty in some circles. Besides the perfunctory “it may not happen” at the end of a long pitch, it is not uncommon to sit in conversations that assume the existence of this funding, and to see decisions being made with this funding in mind. I have no particular individuals or organizations in mind when I write this, and I am keeping in mind many others who are, in my view, acting very responsibly.

I find there is good reason for moderation and patience when it comes to this third wave, and in the following few paragraphs I want to make the case for this.

No such money

Money can easily come and go. It has not been that long since a philanthropic movement saw the floor taken from under its feet. This is not just speculation: there were many learnings for the effective altruist movement from the Sam Bankman-Fried/FTX saga, ranging from avoiding overreliance on one donor or a narrow set of them to staying savvy about optics. From the that debacle, many organizations came to learn that funding is fickle, and a risk-informed approach does well to remember this.

There are eerie similarities between this mounting expectation for funds in 2026, and the speak of “funding overhangs” and “megaprojects” coming from the expectation that Sam Bankman-Fried’s FTX would give much of its profits away. At the time, much ink was spilled about how this money could be spent well, and in the end very little of that actually materialized.

At the end of the day, much of the speculated inflow in funds would come from two US-based companies. For all I know, this expectation is largely based on whispers and expectations. In London, it materializes as a concern with visiting and being in the Bay area, bringing home mounds of cash in triumph.

I don’t think this “no money” scenario is the likeliest, but it is worth pausing to realize that much of this expectation comes from speculation, and it is certainly possible that the money does not materialize at all. As a reminder, many smart people believe that much of the valuation underpinning AI companies to date is ephemeral, and keep pointing to several signs that we may be in a bubble, or at least a light bubbling.

Smaller amounts

One other plausible scenario is one of much smaller growth than anticipated. I personally think we are on this path. This could materialize in many ways, but primarily could happen through corrections in the valuation of these large companies, and moderation of the giving ambitions of the individuals involved.

Nick Allardice, from GiveDirectly, points out that Nan’s napkin math relies on giving rates far larger than the 1.2% rate of giving base rate by the ultra wealthy to date. I truly wish for the individuals to be end up donating their vast wealth, yet it is easy to imagine how the increased amount of attention and courting on this select group of people is creating a sort of self-fulfilling cycle of expectation.

Valuations are also not hard cash. Another scenario that leads to lower rates of giving is the high likelihood of ensuing corrections in the valuation of the main companies, which are yet to find commercially viable models, and have faced deep criticism.

A more modest version of the third wave than what was predicted would very easily put us in the realm of the trickle rather than the wave. While a shock to the system may warrant much chin stroking, a slow progressive increase would not.

Absorption

Another frequent concern is that some philanthropic spaces do not have the capacity to absorb major increases in funding.

This issue is palpable in the animal welfare movement, which is expecting to receive much of the increased philanthropic attention. This space has much fewer organizations, and lacks good evidence on what may work well and scale. This section does not really apply to that space. In the animal welfare space, I think a surge of new efforts may indeed be the best answer to increased funding, given the dire need for proven solutions and implementers.

However, for the global health and development fields, the absorption question sounds to me as a question easily reframed as “how do we absorb this funding?”

The absorption challenge is not a field-wide problem, it is a problem for the individual organizations that wish to access those funds and do not have the capacity to absorb it, due to their organizational set ups and lack of scale. For funders, it’s a question of speed of disbursement.

Second, the absorption problem is more complex than much of the discussion gives credit for. As Allardice points out in his piece on the absorption problem, the issue is that absorbing this type of money is highly difficult, and usually comes down to market size. The idea that the solution to lack of capacity for absorbing billions in the next year is to create new organizations today, ignores the long and winding road to test and scale.

Finally, the global health and development field is blessed with many great opportunities to give at scale. If there’s a windfall or steady increase in giving over the years, many programs across global health and livelihoods could productively absorb funds, cost-effectively. Just to name a few, Rachel Glennester and Leah R. Rosenzweig point out vaccine uptake and cash transfer programs in themselves could absorb a huge proportion of these funds, through government spending, GAVI, and organizations such as GiveDirectly. None of these could absorb all funds, all the time.

What next?

An influx of new money in a sector desperate to turn cash into good deeds is something to celebrate. Many of the preparations incurred might be good to make regardless of the outcome of this third wave. I can see the argument for each individual change in strategy in light of this, and recognize that fully ignoring the possibility of substantial inflows would be a failure in fiduciary duty.

However, it is difficult not to also notice a sense of competition for the attention of these maybe-funders, as well as a rush of strategic adjustments, and investment in absorbency plans that may remain outsized to the flows that actually materialize. To the extent that a philanthropic market exists, this is the closest I’ve ever seen to a bubble.

The issues that preoccupy us in our respective sectors are large and deeply problematic, a sense of urgency certainly fits. There are many things to like about this moment in the non-profit space, and in particular love the ambition for transformational change, at scale. This is something to preserve and cherish.

My words of caution here are not intended to stop the thinking on how to best scale, or to curtail the sense of unbounded ambition. Urgency, however, can lead to rash decisions, and lack of criticality.

The core point is that we should prioritize two-way doors, things that are robust to multiple funding scenarios. A risk-conscious approach would keep in mind that If this transformation in the philanthropic market does not materialize, the downside could be very bad:

• Unnatural growth in staff count, funding and complexity can undermine organizational stability.
• Strategies designed in a rush may prove over-ambitious and poorly thought out.
• Hiring sprees that anticipate funding that does not materialize will inevitably lead to layoffs.
• Time which could have been spent supporting natural growth curves, could be wasted chasing unsustainable paths.

In light of this, the advice no one asked for can be summarized in four points:

1. Continue to plan for scale and think of new ambitious projects
2. Keep well in mind that the wave may not happen or (most probably) could be smaller.
3. Prioritize organizational strategies that are reversible and avoid lock-in
4. Fight against a sense of urgency when it builds up.

Views my own. Thanks to Chris Ivey and Aidan Alexander who gave thoughtful feedback. I used no LLM tools in the production of this text - the humans were harsh enough.