A division of the United States Agency for International Development, which was eliminated last year due to Trump administration budget cuts, has been reborn as an independent nonprofit organisation. The Development Innovation Ventures, now known as the DIV Fund, officially launched on Thursday with a substantial $48 million in philanthropic backing from two private donors.
From Government Agency to Independent Nonprofit
This transformation represents a rare continuation of international development work following the Trump administration's decision to freeze all foreign funding last year. The administration's Department of Government Efficiency, led by Elon Musk, dismantled the agency that had delivered American foreign aid for six decades, resulting in tens of thousands of job losses and significant disruption to global programs.
Amid this destruction, numerous private efforts emerged to preserve decades of data and knowledge housed at USAID, help recipients maintain vital programs, and reimagine international development frameworks. However, few have managed to attract the level of philanthropic funding secured by the DIV Fund.
Celebrating a New Chapter
Funders, previous grantees, and DIV Fund staff gathered in the glass-walled penthouse of a Washington think tank as the sun set on Thursday to mark this significant new chapter. The mood was described as both resolved and optimistic, celebrating the successful transition where many international development initiatives have faltered.
"The loss of US government support is a huge blow," acknowledged Michael Kremer, the DIV Fund's scientific director and a Nobel Prize-winning economist. "It's wonderful that private funders have stepped up to help try to fill part of that gap, but it's only filling part of the gap."
Financial Structure and Future Plans
The DIV Fund aims to grant approximately $25 million annually, representing slightly more than half of the division's previous budget when operating within USAID. Some leaders of the new nonprofit were previously involved in directing $110 million from private philanthropy over the past year to projects that lost USAID funding.
Of the total $48 million raised so far, $20 million has been allocated to former recipients, leaving $28 million available for future grants. The fund plans to issue an open call for applications this year, maintaining their commitment to generating innovative ideas through transparent processes.
Key Factors in Fundraising Success
The DIV Fund's fundraising achievement stems from several strategic advantages. Firstly, the organisation functions as a research and development hub, identifying highly affordable and efficient interventions before supporting their expansion to scale. This approach keeps their budget relatively modest compared to larger programs addressing issues like HIV treatment or famine response.
Secondly, during their time as a USAID division, DIV had already secured outside philanthropic funding, including a $45 million grant from Coefficient Giving, a San Francisco-based foundation that now serves as one of the nonprofit's anchor funders. The other major donor remains anonymous.
Finally, Kremer noted that the programs they identify typically secure funding from local governments or generate revenue independently, rather than relying on long-term support from donor countries like the United States. This sustainability pathway has become increasingly crucial as multiple historic donor nations implement significant cuts to foreign assistance.
New Opportunities Beyond Government Structures
Operating independently from USAID presents new possibilities for the DIV Fund. While within the government agency, DIV occasionally influenced other departments and secured additional support for endorsed projects. Now, as an external entity, the fund plans to collaborate with major donors including the World Bank and other nations to implement their recommendations and establish similar research funds.
Otis Reid, executive director of Global Health & Wellbeing at Coefficient Giving, emphasised the importance of effective resource allocation as official foreign assistance diminishes globally. "It just matters a ton if that money is going towards things that are highly effective or moderately effective or not effective," he stated. "And I think DIV can play a really crucial role in moving things from the not effective to very effective part of the spectrum."
Evidence-Based Approach and Limitations
Many programs supported by DIV undergo validation through randomised control trials, considered a robust research design for assessing intervention effectiveness. Kathryn Oliver, a professor at the London School of Hygiene and Tropical Medicine who studies evidence-based policymaking, acknowledged the value of these trials while noting their limitations.
"It is the most robust research design for answering questions about the effectiveness of interventions compared to usual treatment, absolutely," she explained regarding the trials. "But it is not the most robust design for answering any other kind of questions," such as population acceptability or comparative analysis against alternative approaches.
Uncertain Future Relationship with US Government
As a newly established nonprofit, the DIV Fund remains open to collaboration with the US government, according to co-founder Sasha Gallant. However, this relationship faces uncertainty given Secretary of State Marco Rubio's characterisation of USAID as corrupt, costly, and ineffective, with claims that foreign aid creates permanent dependency among recipient governments and large nonprofits.
Despite significant foreign aid cuts and clawbacks in 2025, Congress recently allocated $50 billion for various foreign assistance programs, substantially exceeding the administration's request. DIV had previously enjoyed bipartisan support partly due to the high return on investment offered by its programs, a metric that also appeals to philanthropic funders.
The DIV Fund does not intend to replace funding for large programs backed by extensive evidence or those that may be expensive but valuable, such as humanitarian responses. Gallant emphasised that the fund strongly hopes donor countries will continue supporting these other program types.
"We absolutely should be delivering en masse the things that increase people's livelihoods and save their lives and keep kids in school," she affirmed.
