I found the best piece in the series was penned by the whip-smart Ian David Moss (“Economies and Diseconomies of Scale in the Arts – Take Two”), and it was his post that inspired both me to both write an initial comment, and then to take on the subject more fully below.
You see, dear reader, like many of my fellow funders and financiers I’ve often touted the benefits of moving toward greater scale: improved operational efficiencies, greater programmatic reach, increased access to resources, heavier political punch. But I’ve also struggled with the oft recognized but seldom addressed reality that scale is not an answer in and of itself, and that sometimes scaled solutions leave even larger problems in their wake. Thanks to Ian, I think I got the mental kick in the epiphany I needed.
I hope you’ll enjoy this two-part miniseries on why I think scale sometimes, well, stinks up the joint.
The Mechanics of Moving Capital
I don’t care how you’re doing it, when it comes to getting money out the door it’s always easier to do it in big chunks. Whether you’re making a grant, extending a loan, or placing private equity, cost per transaction is lower if you make fewer, larger transactions. This is axiomatic. Read the rest of this entry »