To make a transformational impact on the lives of children and youth living in poverty, we must address the challenges facing three stakeholders: children and youth, social sector leaders and philanthropists.
The Grip of Poverty
Today, one out of every five American children lives in poverty, posing a problem of unprecedented scope and scale. Poverty threatens every aspect of a child’s well-being, from physical and mental health to social-emotional and cognitive development – perpetuating a vicious cycle that can be nearly impossible to escape.
15 million American children, or 21%, live in poverty
Challenge for Children & Youth
To ignore childhood poverty is to abandon our next generation and undermine our nation’s future. Although solutions exist today that can make a meaningful difference, the social sector is not providing these solutions at the scale needed to address the complex problems facing poor children and youth.
Challenge for Social Sector Leaders
Visionary leaders with evidence-based programs are making a meaningful difference in the lives of young people across the country. But without robust growth capital or any market incentive to think big and bold, they cannot bring their strategies to a national scale.
Challenge for Philanthropists
Nonprofit leaders need capital to scale up their programs, and there are philanthropists ready and willing to invest in them. Unfortunately, the market for social sector investment lacks any real infrastructure, which means philanthropists have no efficient means to deploy large amounts of capital toward high-impact solutions poised to scale.
To make a transformational impact on the lives of young people living in poverty, we have to change the current funding paradigm – which does not channel significant capital to promising interventions – and embrace a new model of philanthropy.
Blue Meridian Partners seeks to transform the life trajectories of children and youth living in poverty.
We do this in two ways. First, we identify successful strategies for addressing social problems confronting children and youth in poverty and help scale them.
Second, we unlock significant capital by providing philanthropists a way to pool resources to support scaling – investing as much as $200 million in each strategy. Our Partners work collaboratively – sharing the costs, risks and rewards of our efforts.
We believe our performance-based investing approach – combined with our model of capital aggregation – has the potential to change the funding paradigm for solving problems in the social sector.
We believe our approach offers new opportunities for three key stakeholders.
Children and Youth
for children and youth living in poverty to reach their full potential and lead more productive lives
Social Sector Leaders
for visionary social sector leaders to scale up their strategies and aim higher, think bigger and make a greater difference in the lives of young people
for philanthropists to make more efficient and effective investments by partnering with others and sharing the costs, risks and rewards
Our model of philanthropy centers on performance-based investment and capital aggregation, building on the work of the Edna McConnell Clark Foundation (EMCF). Over 17 years, EMCF honed a comprehensive set of practices to identify and fund youth-serving nonprofits. Blue Meridian is leveraging EMCF’s experience with a holistic approach that includes five major components.
1 — Sourcing
We begin by casting a wide net, looking for promising strategies poised to achieve national impact on social problems confronting children and youth living in poverty. The strategies we consider cover a variety of issue areas and differ in many respects. Every successful candidate for investment holds itself accountable for the outcomes of its target population and shares a potential to solve a social problem. Our research and vetting focuses on six selection criteria.
2 — Due Dilligence
Next, we take a hard and deep look to determine whether an organization is ready for scaling – and if so, whether an infusion of philanthropic capital would help it create a real national impact. We test critical assumptions that underlie the viability of the investment and identify key questions to address in developing a scaling plan.
3 — Planning & Initial Investment
Blue Meridian’s initial investments are designed to help lay the groundwork for rapid growth. During this phase, investees start to fill leadership and capacity gaps, pilot new approaches, conduct additional evaluation and, most importantly, develop a scaling plan.
4 — Large-Scale Investment
We make big bets, up to $200 million, on each of our investees. Scaling plans are at the heart of Blue Meridian’s large-scale investments. Unlike most philanthropic or government grants, our investments consist of flexible upfront growth capital. Together with our investees, we decide on milestones to measure their performance over the investment horizon, with annual payouts tied directly to that performance.
5 — Ongoing Management
Blue Meridian’s support for investees extends beyond the financial. We pair each investee with a Managing Director: an experienced leader who provides strategic counsel to its CEO and board. In addition, we monitor our investees’ performance and make quarterly reports to our Partners.