Philanthropy rarely begins with a plan. It often begins when individuals encounter a problem they can't unsee, or meet a dynamic founder who illuminates an important issue. For many individual philanthropists in India, this moment arrives when they come face-to-face with a reality that urban professional life had never shown them: The distance between India and Bharat is not just geographic.
This "moment of discovery" is reshaping how philanthropists give. More are now backing small and medium non-profits (SMNs) rather than channelling capital only toward visible, institutional players. They are waking up to a simple truth: SMNs work closest to the hardest problems, and they deserve funding, even in their nascent stages.
Understanding why requires looking at funder behaviour, not just organisational capacity. Research by CIFSI at the Indian School of Development Management, in partnership with Social Venture Partners (SVP) India, tracked how individual philanthropists engage with SMNs and uncovered a portrait of giving that looks radically different from the institutional model.
Let's start by debunking some sector myths: Funders do not lead with thematic priorities or geographic filters. They start with the founder. Clarity of vision, openness to honest dialogue, and the credibility that comes from genuine ground presence– these move a philanthropist to act, far more than sector-priority documents or compliance portfolios.
This is not sentiment replacing rigour. It is a different kind of rigour: recognising that in an SMN's early life, the organisation is essentially the founder. Backing the right person, even before systems mature, represents the highest-conviction bet possible.
{{/usCountry}}This is not sentiment replacing rigour. It is a different kind of rigour: recognising that in an SMN's early life, the organisation is essentially the founder. Backing the right person, even before systems mature, represents the highest-conviction bet possible.
{{/usCountry}}What follows is a funding relationship structured around trust rather than control. This means unrestricted grants, flexibility to reallocate mid-year if ground realities shift, no lengthy reporting forms. The funder bets on the founder's judgment and signals this clearly. This matters in more ways than one: personal philanthropic capital graduates into ecosystem capital. A ₹2.5 lakh grant from a trusted source does not just fund a programme; it signals to the next funder that this organisation is worth backing.
Money, it turns out, is just one piece of the puzzle. The harder (and more consequential) contribution is what comes alongside it.
The most effective philanthropists in this space bring their networks, their credibility, and their time. They make introductions that transform an SMN's fundraising trajectory. They lend their name to an early-stage organisation, creating a credibility signal that no amount of impact data can replicate. They visit the field, not to evaluate but to understand. And they practice a discipline that doesn't come naturally to high-achieving professionals: They resist over-advising. A stretched team with one founder and three staff doesn't need a consultant arriving with a list of improvements. It needs a funder who knows when to speak and when to step back.
Over time, this engagement produces something neither party plans for. Funders evolve. The grant-maker becomes an advisor, then a board member, then (often most valuably) a peer connector who introduces the SMN to other donors, CSR pipelines, and institutional funders.
In this way, many individual philanthropists already do ecosystem-building work– informally, relationally, often invisibly. This is organisational development, not just programme funding. Sustained, unrestricted capital helps SMNs build the governance, leadership, and learning systems that underpin long-term impact. Stronger organisations, in turn, strengthen development outcomes– placing organisational management at the heart of ecosystem building. The challenge is that this work stays local. Learnings from one funder relationship, one chapter, one cohort cycle rarely travel far enough to shift sector norms.
As more funders enter the space, SMNs need sharper focus. Three things must change.
First, intermediary platforms (cohort models, sector-specific incubators, giving networks) must scale without losing the high-touch quality that makes them effective. This accomplishes three critical things: It mobilises more money from a larger funder network, it builds a peer learning community among NGOs, and it scaffolds credibility for new funders. Simply put, it creates entry points (across more causes and geographies) for funders and other ecosystem players.
Second, philanthropists must speak openly about what they do and invite their networks to join them. The cultural hesitation around public giving– the instinct to stay quiet, the fear of appearing to seek recognition– carries real costs. It keeps role models invisible. It raises the activation energy for professionals who aren't yet giving but might be, if they could see the entry point is within reach. A seasoned philanthropist's most valuable move is bringing in fresh capital from someone who wasn't giving at all.
Third, the development ecosystem itself must speak with one voice about the work SMNs do. Today, people unfamiliar with the sector still see charitable giving as downstream, a band-aid. They don't grasp that SMNs drive outcome-focused, growth-oriented, nation-building work– work that is harder to understand, slower to take root, but ultimately paradigm-changing. The sector must own this narrative and tell it compellingly.
India's grassroots non-profits are already working in the districts and on the causes that the funding system overlooks. It's time for funders to catch up.
(The views expressed are personal)
This article is authored by Trisha Varma, director, Global Knowledge Hub, ISDM and Amita Chauhan, board member, SVP India.