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Robin Hood’s system of metrics, dubbed Relentless Monetization, pursues a powerful ambition: to spend philanthropic money smartly. In Robin Hood’s case, that means spending donors’ money in a manner that cuts poverty as deeply as possible. Our metrics help staff to decide the relative impact of poverty-fighting options. Is money better invested in a high school that graduates 50 more former dropouts or, instead, a job-training program that places an extra 75 unemployed workers in long-term jobs.
To answer the fundamental question of how to measure the relative poverty-fighting success of grants, staff, first, identifies each mission-relevant outcome generated by a grant. For example, school grants boost high school graduation rates and improve the future long-term health of graduates. Next we assign dollar values to those outcomes (staff “monetizes” the value of a high school diploma and improved health). Third, we explicitly compare what happens to participants in our programs —the students in schools we fund; the workers enrolled in our training programs —to what would have happened to them had they in fact not received our help (the latter estimates are known as counterfactual estimates). Finally, we use these estimates to form benefit-cost ratios, which assign a dollar figure to the amount of philanthropic good that a grant does per dollar of cost.
The benefit-cost ratios can be used to compare the impact of one grant against any other, no matter how those grants differ in form and purpose. Robin Hood has put principles to practical use across a large array of poverty-fighting interventions. Health clinics diagnose and treat asthma. How much better off are patients who receive these interventions? Schools help at-risk students earn their high school diplomas. How much does graduation boost future earnings? Micro loans to help immigrant women set up home businesses. By how much do these loans boost family incomes (above what they would have been without the loans)? What is the value of emergency food, shelters for abused women or high quality pre-kindergarten programs. Beyond the purpose of helping staff to decide among rival uses of philanthropic money, Robin Hood’s metrics system provides a powerful diagnostic tool by which to isolate the specific factors that make anti-poverty programs succeed or fail.
We base grant decisions on more than arithmetic. Program officers add to the decision mix detailed knowledge about the programs they are asked to fund. Most important, staff recognizes the imprecision and incompleteness of our numerical estimates. They are under constant review and revision. We still have a lot of work to do.
See the 163 Metrics formulas we have developed to evaluate poverty interventions:
DOWNLOAD: METRIC EQUATIONS - BETA (PDF)
For more about Robin Hood's approach to measurement
read Michael M. Weinstein's book, The Robin Hood Rules for Smart Giving.
Learn more about Robin Hood's use of metrics to evaulate our grants: