Traditional grantmaking often ties money to narrow projects, demands long applications and requires detailed reports. Those rules take time small organizations do not have. They also tend to favor groups with professional fundraising staff, which leaves many organizations led by people of color underfunded.
The Whitman Institute, a San Francisco foundation, began promoting the term in the 2010s. In January 2020, it joined the Headwaters Foundation and the Robert Sterling Clark Foundation to launch the Trust-Based Philanthropy Project, a peer network urging funders to adopt the approach. During the COVID-19 pandemic and the racial justice uprisings of 2020, many foundations loosened restrictions and gave unrestricted money, which brought the idea wider attention.
Trust-based philanthropy matters because it addresses who decides how charitable money is spent. Groups closest to a problem often understand it best. Unrestricted, long-term funding lets them pay staff, plan ahead and respond to crises instead of chasing the priorities of distant funders.