Introducing the Digital Fund — and a different way of funding digital

Phoebe Tickell, Digital Portfolio Officer at The National Lottery Community Fund introduces the Digital Fund and its approach to funding in a digital and networked age.

Earlier this year, I decided to take the experience I have built in participatory governance and community building and apply it to a new area of focus: funding and philanthropy. It was through talking with Cassie Robinson (now Senior Head of UK Portfolio at The National Lottery Community Fund) that I discovered the work of The National Lottery Community Fund (TNLCF) and learned that they are one of the biggest funders of community projects in the UK. Since its creation 25 years ago, TNLCF has awarded a whopping estimated £9 billion to community initiatives and charities across the UK.

In October this year, I started working with the Digital Fund - a £15million fund that sits within the UK Portfolio. From first glance, you might think it just does what it says on the tin: funds projects that use digital technologies. However, we are using an approach to funding that in many ways mimics the ways of working and approach of the digital, networked age, and also funding organisations to transform the way they work, and the reasons they exist, to be fit for this new and continually changing environment.

Digital technology introduced and popularised new ways of thinking and working: things like iterative learning, agile approaches, open source and working-out-loud and enabled collaborative ecosystems to flourish. We are taking these ways of working and incorporating them into how we work with grant holders. For example, instead of the more traditional “annual end of year reporting” common to grant giving and funding, the approach we are taking will involve regular retrospectives and updates, and collective sense-making of learnings. We are encouraging grant holders to share their learnings - with the world and each other - and it is this aspect that my role at the Digital Fund will be all about.

Here are the key things to know about the Digital Fund.

• Set up in 2018
• Delivery of a £15 million fund
• £12.6 million spent so far
• 1200 applications
• 46 organisations invited to submit a full proposal
• 29 organisations awarded funding
• Two strands of funding so far: strand one and strand two
• Funding includes a support partner package

Below, I’m going to introduce you to the final three points: first the different approaches of the two strands, then a bit on the support partners and lastly, an overview of grant holders.

We divided the funding into two different “strands” which funded two very different kinds of organisation and project. In a way, strand two is like a more recognisable “digital” grant — funding a tool or a digital approach which could be scaled. The majority of our grant holders received “strand one” funding which is the more unique approach I mentioned above. Read more about both below and in the original blog post that describes both strands (though some of our thinking has evolved).

Strand one offered grants of up to £500,000 and a tailored support package with the goal of enabling established organisations to use digital tools to take a major leap forward. In other words using a “digital as a trojan horse to bring about a much larger change.” The question we asked those organisations was, if you were set up today, how would you design the organisation?

This strand is about realising that the world many of these charities were set up in was a completely different world to the one we’re in today. The promise of digital is not simply having a better website or using digital records — it’s literally changed the way we work. It’s changed what is possible, changed the wider contexts in which civil society organisations exist and more obviously it has changed the basics of what a charity does — people have new needs, expectations and behaviours. That means how charities provide their services also needs to change.

Take one of our grant holders, the well-known charity, for example; many of us know what the Samaritans do — their mission is essentially to reduce the number of people in the UK who commit suicide and support those who may be considering doing so. 30 years ago the only realistic way they could do this was via the phone and face-to-face interactions. And training their volunteers could only realistically happen via in-person trainings. Now, the landscape is completely different. Samaritans has received strand one funding to develop a few things:

• an online self-help tool for those experiencing suicidal thoughts who may not feel able to seek help via telephone
• modernising and digitising the volunteer recruitment and training journey
• empowering and supporting the wider organisation in undergoing this change to its services.
  

But more than this, the programme of change they are undergoing is being guided by principles which in our eyes underpin the core of what it means to work in a way that ensures organisations can continually adapt and change, and work more effectively with others, and use a networked approach. The principles include: using service design to meet users’ needs; involving volunteers in co-design and co-production; ensuring decisions are based on evidence (data) to improve outcomes; and joining up parts of the programme to work in a coherent, whole-systems way.

Key to the strand one funding is that organisations were committed to sharing their learning and solutions developed with the wider ecosystem: an “open source” approach. We invested in organisations that showed a commitment to share and improve the success of the wider field. This was also to recognise that by funding larger, more established charities, we wanted them to rethink what role they play in the wider ecosystem and how they can bring value to it.

It’s quite a different way of funding and to our knowledge we’re not aware of any other philanthropic funds that invest in the complete rethink and redesign of civil society organisations. We only wanted to support organisations that were fundamentally rethinking the core way that they operated — not just upgrading “business as usual”.

Strand two offered grants of up to £500,000 for newer organisations that had already launched promising services that use digital technology to scale or increase their impact. Organisations had to have demonstrated they had a significant number of people already using their service, had digital practices like user research and design at the heart of how they had grown, — and that they knew what technology afforded in terms of reach and impact. We were looking for the services or platforms that could end up being the next big thing in terms of a scaled digital tool, that could have massive impact in helping people.

Obviously the landscape is quite different to, say, the Silicon Valley ecosystem of apps and tech platforms — without massive investment and the engine of return on investment, the charity sector is at quite a different stage in terms of innovation and scale. But the organisations we have funded show real promise and innovation in how they are tacking all sorts of solutions for problems in different sectors of society — supplying fresh healthy food to everyone, supporting young mothers, democratising sexual health, supporting the elderly and decreasing isolation, increasing safety of sex workers, and supporting family carers. Read the next blogpost to find out more about who we funded.

The other key part of our ecosystem approach at the Digital Fund is the way we’ve curated a network of support partners to work with every single grant holder organisation and provide support in the area of “digital” alongside their project and funding. This support ranges from more generic, but important things like leadership coaching and developing strategy and roadmaps to things specific to tech and digital: responsible governance and tech ethics, and help on service design, user research and user experience design. We love that every single Digital Fund grant holder will be using Doteveryone’s — this is a commitment from TNLCF to only put responsible technology out into the world.

Our support partners are: CAST, DotProject, Shift, Doteveryone and there are several added benefits to this networked approach to support — one is that through regular sensemaking sessions, support partners are able to identify patterns across the challenges grant holders are facing and think strategically about offerings where there are common needs for help and support. The second is that this web of support will actively connect into other support offerings in the sector, so that there is not a cliff edge when the grants end.

My role sits at the intersection of the support partner network and the 29 grant holders — stewarding the whole ecosystem and its strategic intent and designing a programme of learning and capturing key insights to communicate with the wider civil society sector and the funder and philanthropist ecosystem.