Why might founding a new project be high impact?

Creating an organisation that persists without you is a route to having a lot of impact in general, but the need for founders within the problems we focus on is unusually pressing right now. This is because many of these problems have seen a large increase in available funding in the last few years — reaching tens of billions of dollars — so there’s a greater need than ever for new organisations that can effectively deploy this funding.

There are also more and more ideas for new projects — and people willing to work at them — but founders remain comparatively rare, so it seems like founders might be the key bottleneck right now.

Someone with the right profile, idea, and plan could plausibly be given several hundred thousand dollars fairly quickly to test out their idea, with the potential to scale that to tens of millions of dollars per year within several years if it’s promising after testing.

There is even interest in founding ‘megaprojects’ that could effectively deploy $100 million per year.

Even a moderate chance of success could easily make this your highest-impact option.

Founding a project can also be among the best options for building your career capital, since it’s impressive and you’ll probably learn a huge amount.

You can learn more about what the recent growth in resources available implies about priorities for our readers in this talk.

What does it take to succeed?

Despite the increase in available funding, founding a successful social impact organisation is not easy. Here are some of the things you need to succeed.

A good enough idea

Donors are only willing to fund projects above a certain ‘bar’ for cost effectiveness, based on their estimate of how effectively they’ll be able to deploy funds in the long term.

So, your project will only get off the ground if you can convince donors that it has a reasonable shot of being more cost effective than this bar.

Different funders have different bars, and the bars often aren’t explicit. But here’s our understanding of what it often takes to get funded:

• Within efforts to help people over the coming decades (often called ‘neartermism’), new organisations typically must have the potential to be at least as cost effective as GiveWell’s top charities, such as the Against Malaria Foundation. This requires having a reasonable chance of being about seven times more cost effective than cash transfers to the world’s poorest people, and ideally the potential to reach significant scale (e.g. a budget of $10 million per year or higher).
• Within longtermism and existential risk, you should aim to build something that’s similarly compelling to donors as projects currently funded by the Long-Term Future Fund — by being either significantly more cost effective or scalable than those projects.
• Within movement-building organisations (or other ‘meta’ projects), new organisations must have the potential to be a positive ‘multiplier’ on other top opportunities. For instance, for every $1 they spend, a fundraising charity would need to aim to raise significantly more than $1 for somewhere like the EA Infrastructure Fund.

It’s harder to meet these bars than it first seems, because estimates of cost effectiveness need to be adjusted for:

• Overoptimism — estimates typically regress to the mean when done more carefully. Pilot programmes are also typically significantly more cost effective than the scaled-up version of a programme.
• Counterfactuals — e.g. if a fundraising charity appears to raise $100, typically some of that money would have been donated anyway, and that needs to be removed from the estimate.
• The opportunity cost of labour invested in the project — if you hire people who could have had a positive impact otherwise, such as by earning to give, then their effective ‘cost’ could be much higher than their salaries.
• Indirect ways the project could have a negative impact or affect others trying to do good, such as creating PR risks.
• Time discounting of benefits that take a long time to pay off.

While it’s often well worth testing out many ideas to see if they can cross the bar, it’s not an easy thing to do, and we should expect most projects to not work out.

An idea that really motivates you

Successful founders are typically obsessed with their idea, and find it hard to imagine working on anything else. This level of motivation is often necessary to see an idea through, and stick with it for the 5–10 years required to get something off the ground.

That said, great startup ideas often emerge out of fun projects that weren’t expected to turn into organisations, but become obsessions over time. If you tend to have slightly intense side projects, that’s a good sign for your fit for this path.

Leadership potential

Running a social impact organisation requires significant skill, and in particular, some degree of leadership potential — i.e. the ability to develop a vision and inspire people to back it.

Many founders who seem formidable today did not seem impressive when they first started. So you shouldn’t give up if you don’t feel like a CEO today. But you can look for small-scale signs of potential, such as whether you can convince one or two people to support the idea, and whether you often have lots of ideas for ways to make things better.

Generalist skills

Founders tend to be generalists — running a startup requires juggling more duties than one can really learn how to do ‘the right way.’ It crucially relies on the ability and willingness to handle many things ‘just well enough’ (usually with very little training or guidance), and focus one’s energy on the few things that are worth doing ‘reasonably well.’

Enough knowledge of the area

We encourage people to work on issues like biosecurity and AI safety, which require specialist knowledge and connections. You can often gain these within around a year if you make meeting people in the area your top priority (though it’s useful to have more experience than that).

In the for-profit world, industry experience and age are both correlated with probability of success, and we expect the same applies here.

The ability to convince funders

There aren’t many grantmakers involved in the issues we most highly recommend. We think there’s also a grantmaker bottleneck — i.e. current grantmakers are not able to thoroughly consider every potential project, especially those that are small or in lower-priority areas.

The current pathways to funding — we list some below — may not be sufficient to cover every organisation that’s above the bar. You’ll also be at the mercy of a relatively small number of decision-makers.

You’ll have an easier time raising funds if you build up some profile and trust within the effective altruism community, or with some other significant group of donors, before you aim to raise a lot of money.

You can also test how interested funders are by speaking to a couple of them early on.

The increase in funding available within effective altruism means fundraising will be easier, but it won’t necessarily be easy. You’ll still likely need to speak to tens of donors and face many rejections. (Learn more.)

All this said, if you are able to convince funders in effective altruism, then they will typically be willing to give you more money if you’re able to have more impact. This is pretty different from much of the rest of the nonprofit sector, where donors tend to give more based on passion, and won’t necessarily scale up funding in proportion to your results.

Good judgement

Nonprofit ideas often lack good feedback mechanisms (such as revenue), which means that the leader’s judgement about what the biggest priorities are is much more important. It’s easy to focus on the wrong thing and lose most of what matters. (Learn more about how to develop your judgement.)

The ability, willingness, and resilience to work on something that might not work out

Not everyone has the flexibility to try a project for a while that is likely to not go anywhere. You can try to reduce the risks by testing it as a side project first. (It’s also important to have a backup plan, which we discuss in our career planning course.)

That said, it’s also easy to overstate the downsides of starting a new project. You might well find it wouldn’t be hard to return to regular employment (especially if you have a specific backup plan and/or have some savings), and you’ll likely gain good career capital that will serve you in your next role.

Here’s an article that goes into more depth about the bottlenecks to entrepreneurship within longtermism.

Examples of people pursuing this path

Next steps if you already have an idea

If you already have an idea you feel really motivated by, we’d encourage you to pursue it.

Even if it doesn’t work out, you’ll probably learn a lot about entrepreneurship and the problem area in question. Most people in our community (and many people in general) respect someone who’s tried to do something ambitious and difficult, even if it didn’t work out. You’ll probably end up with at least similarly good career capital to what you would have otherwise.

The next steps typically involve further testing out your idea, since getting started is often the quickest way to learn about whether funders and potential hires are interested, how quickly you can make progress, and what the main strategic uncertainties are. This could mean trying to pursue it on the side while you stay in your current job, or if you have the flexibility, you could aim to work on it exclusively for a few months.

Pick one very small and simple version of your idea as the test. A common mistake among founders is to try to do way too much at once. Most great startups have an idea that can be simply explained even at scale, and when you’re just getting started, it’s even more important to start small. People underestimate how hard it is just to do one thing well — but doing something well on a small scale is the best way to build trust with funders, and unlock more resources to expand your idea to the next stage.

Besides starting small, try to design a test that can resolve one of your key uncertainties about the project. Ask yourself, “What’s the minimum amount of validation I need to justify the next level of funding?” Then do that. If it works out, go to the next level of scale.

It’s hard to give much more general purpose advice, so if the idea is for a project within one of our priority problem areas or problem areas that seem promising, then we’d be interested to speak to you.

If you’re further along, you could:

• Apply for seed funding from one of the Effective Altruism Funds, including the Long-Term Future Fund and the Infrastructure Fund, which focus on some of the problems we think are most pressing.
• Apply to the FTX Future Fund, which focuses on attempts to improve humanity’s odds of surviving and flourishing for thousands of years or longer.
• Apply to Charity Entrepreneurship, which helps grow organisations within global health and animal welfare, as well as ‘meta charities.’
• If your idea is within global health, see GiveWell’s Incubation Grants.
• If you have an idea for a bigger project, aim to speak to someone at Open Philanthropy about it.
• There are also ‘angel donors’ in the community who can make $100,000 grants to new projects — you may be able to meet them by being generally involved in effective altruism.
• Here’s a longer list of funding sources within the effective altruism community.

Note that issues in AI safety, biosecurity, and the more long-term-focused meta charities seem to be less funding constrained than many neartermist issues like global health — though if you have an idea for a charity that could be as or more cost effective than GiveWell’s top charities, there are pathways to being scaled up.

There are also many other organisations that can help you outside of the effective altruism ecosystem. For example:

• 80,000 Hours got a lot out of Y Combinator’s nonprofit programme.
• Fast Forward is an incubator for tech nonprofits.
• Skoll helps social entrepreneurs.
• And there are other nonprofit accelerators worth exploring.

In the first couple of years, you’re probably doing reasonably well if your organisation is in a reasonable financial position, hasn’t had any clear disasters, and has done pretty well at attracting talent. Beyond that, how long to stick with your project is a difficult judgement call.

Next steps if you don’t have an idea yet

Normally we’d recommend working within the problem areas that you might want to found something within. You could seek almost any relevant job — including working at a nonprofit, working in policy if you want to start a think tank, working in academia if you want to start a research institute, working at a tech startup, and so on. If you’re already more senior, you could start by advising organisations in the area in which you want to found the nonprofit.

Working within the problem area will help you gain relevant knowledge and connections, and give you a chance to stumble across gaps you might help fill — especially if you explore ideas on the side at the same time.

There’s a difficult question about how ‘directed’ to be about finding an idea. In the for-profit world, people often say that the best ideas are stumbled across rather than the result of a deliberate search. There’s also a lot of scepticism about whether someone can be ‘handed’ an idea from someone else — the thought is that if you don’t come up with the idea yourself, you’re unlikely to be obsessed with it enough to make it work. This, however, seems to be somewhat less true in the nonprofit world. We think it can be worth entertaining other people’s ideas, and seeing if they catch your motivation. If you have the flexibility, you could consider taking 3–12 months off from your normal work to learn about and test ideas.

While looking for an idea to pursue in the longer term, it’s ideal to work in a generalist role where you can practise different skills needed in running an organisation (e.g. recruiting, strategy, management, finances) — positions at small but rapidly growing organisations are often good for this. You could either work at a nonprofit (which is good because it helps you learn about running a social impact organisation), or a for-profit (which is good because they’re often closer to applying best practices and you can learn faster with better feedback).

You could also seek a position that lets you explore project ideas on the side — many startups began in graduate school for this reason.

Might founding a for-profit company be good training? You’ll probably learn a lot, though this often involves being locked in for 5–10 years, so it isn’t generally the most efficient route to founding a project with direct impact (though it could give you money and other good career capital).

Lists of ideas

If you’re interested in hearing the most promising current ideas, we’d encourage you to apply for our one-on-one advice, and we can introduce you to people trying out new projects.

To give you a flavour of what exists, here are some of the best public lists we’re aware of:

• Project ideas from the FTX Future Fund
• Ideas for megaprojects on the EA Forum
• Big biosecurity projects by Andrew Snyder-Beattie and Ethan Alley on the EA Forum
• Gaps in effective altruism by Michelle Hutchinson on the EA Forum
• Charity Entrepreneurship’s top meta charity ideas and ideas in global health, animal welfare, and mental health
• Our profile on founding effective international development nonprofits
• Alternative protein project ideas by the Good Food Institute (and you may also want to listen to our podcast with the founder, Bruce Friedrich)
• Sam Bankman-Fried on taking a high-risk approach to crypto and doing good by Robert Wiblin and Keiran Harris

Want one-on-one advice on pursuing this path?

If you think this path might be a great option for you, but you haven’t found the right idea for a new organisation to found, our team might be able to tell you about ideas that aren’t public yet and introduce you to others pursuing this path.

APPLY TO SPEAK WITH OUR TEAM

Read next:  Learn about other high-impact careers

Want to consider more paths? See our list of the highest-impact career paths according to our research.

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