SAN FRANCISCO — A new acquisition in the charitable giving sector is a sign of growing interest in a more comprehensive definition of nonprofit effectiveness.
Charity Navigator, the largest independent evaluator of nonprofits in the United States, has acquired ImpactMatters, a startup that rates nonprofits based on cost effectiveness. Traditionally, Charity Navigator rated nonprofits based on basic financial transparency data, including overhead costs. By acquiring the ImpactMatters team and its ratings methodology, Charity Navigator is continuing its shift toward rating nonprofits based on impact achieved per dollar spent.
The Bill & Melinda Gates Foundation supported the acquisition, which was announced on Wednesday, as part of its strategy to support better giving.