Gates Foundation stops new grants to Arabella-administered funds

The Bill and Melinda Gates Foundation announced in late June that it will stop making new grants to nonprofit funds administered by Arabella Advisors, a Washington D.C. consulting firm that oversees a network of fiscal sponsors and philanthropic intermediaries, according to an internal foundation announcement dated June 24. Foundation officials said the change affects new investments and that the foundation will not extend some existing arrangements, and in some cases will seek early exits from longer term commitments.

In the internal memo, foundation staff were told the shift reflects a strategic choice to work more directly with programmatic partners. "Teams are increasingly working directly with programmatic partners, organizations that are deeply embedded in the communities we serve and are closely aligned with our mission," the announcement said. A Gates Foundation spokesperson described the move as a "business decision that reflects our regular strategic assessments and partnerships."

Foundation records show the Gates Foundation has disbursed or pledged roughly $450 million to Arabella-administered nonprofit funds over the past 16 years. The funds have provided back office...