I recall reading an article once that claimed that, when examining small and large foundations, it turned out that there was a maximum amount that a given grantmaker typically gave out. And as organizations scaled to give out more money, this amount stayed surprisingly fixed, with a higher overhead ratio than you might have expected.
I don't remember the number, or the methodology that determined it. Curious if anyone can remember the article. (It might have been from OpenPhil's blog, or it might have been some random news site).
I vaguely remember the number "3" being involved, possibly $300k, or $3 million.
The takeaway I remember was something like "you might naively think you can scale up an organization and then give away money more efficiently, but weird forces seem to limit that."
Does this sound familiar to anyone?
I do not know this article but here are my thoughts on this problem, having worked at a private foundation myself.
The amount of money awarded per staff lies on a scale. On one end a foundation could just make 1 massive grant a year to one organization. On the other end, make millions of super small grants. As organizations navigate this scale from one extreme to the other, in my experience these are some of their considerations: