By Min Zhu.
Philanthropy is currently in a period of contraction. Funding is becoming more uncertain, priorities are shifting, and many organizations, especially grassroots movements in the Global South, are once again being asked to do more with less.
When the resources become scarce but the need for social change remains, a question inevitably appears:
Why fund an intermediary? Why not directly fund grassroots organizations?
It’s a fair question, but I believe it misunderstands what intermediary funds actually do. An intermediary is not simply a channel through which money moves. At its best, it is infrastructure. And infrastructure is often most visible when it’s missing.
Today, most philanthropic capital remains concentrated in the global minority [global north], while many of the movements creating the deepest social change are rooted in the global majority [global south]. Connecting these two worlds is not as simple as transferring funds from one bank account to another. Different legal entities, banking barriers, sanctions screening, due diligence requirements, reporting expectations, language, and institutional norms all stand between a donor’s intention and a grassroots organization’s ability to use resources. Someone has to bridge those two worlds. That is what the intermediary funds do.
After years at FRIDA, I have witnessed how we mobilize resources from multiple donors and redistribute them through multi-year core support to young feminist organizations around the world. Our model is built on a belief that communities themselves are best positioned to decide what their priorities are. Flexible funding enables organizations to strengthen their movements instead of reshaping themselves to fit narrowly-defined project budgets.
However, flexibility and trust do not happen by accident. Instead, trust requires even stronger systems, not weaker ones. Every grant represents two commitments that exist simultaneously. The first is our commitment to our grantee partners. We want funding to be accessible, timely and responsive to the realities they navigate every day. The second is our commitment to donors. Every dollar carries expectations, not only that funds will reach the right social movements, but that they will be managed responsibly, transparently, and in line with legal and audit standards. These responsibilities are sometimes seen as opposing forces. But I think the role of an intermediary is precisely to absorb the tension between them.
One experience has stayed with me. Through FRIDA’s participatory grantmaking process, staff across the entire organization have opportunities to review applications from regions we know or identify with. Reading these applications, I was struck by how much grassroots organizations carry. Many of them are run by small teams. The same people facilitating workshops are also writing proposals, managing finances, answering donor questions, coordinating volunteers, and keeping the organization running. That was when I realized accessibility is not only about who receives funding. It’s also about how much work it takes just to access it. This is where intermediary funds create value.
As an intermediary, much of the administrative complexity stays with us rather than being pushed onto our grantee partners. From due diligence and onboarding to grant agreements, sanctions screening, payment verification, reporting support, and capacity strengthening, we carry responsibilities that many grassroots organizations should not have to navigate alone. Every grant passes through multiple layers of review. Programs, Finance, and Leadership each contribute different expertise before resources are disbursed. Internal controls exist not because we distrust our partners, but because responsible stewardship makes trust sustainable.
From where I sit in finance, I believe that sometimes the most meaningful finance decision isn’t just about accounting. It’s about deciding whether splitting a payment into installments will make life easier for a grantee partner, or whether a document can be simplified without compromising donor requirements, or whether a payment timeline should be adjusted because we understand the context a grantee is working in. These are small decisions from a finance perspective, but they do make a real difference for organizations operating with limited capacity.
If the philanthropic sector is going to continue to contract with fewer resources, then every grant matters. But so does every unnecessary burden we remove. The real value of an intermediary fund is not simply re-distributing resources, but absorbing complexity and translating trust into accountability. It is a strategic infrastructure that philanthropy can’t afford to lose.
