From Donations to Investment: Building Sustainable Education through a Social Impact Holding in Colombia

• In Event: Decolonizing Finance: Shifting Power for Educational Equity

Proposal

In a global context where effectiveness and innovation in the use of capital are increasingly prioritized, many philanthropic organizations are rethinking traditional models of financing. Philanthropy is no longer limited to making donations; instead, it is shifting toward deploying capital strategically to maximize long-term impact. This transformation becomes even more relevant in light of the reconfiguration of international cooperation and development finance, driven by global political and economic changes. The USAID case illustrates how quickly funding landscapes can shift, while reductions in official development assistance (ODA) from countries such as the United Kingdom, France, and Germany further intensify competition for scarce resources. At the same time, bureaucratic processes continue to limit access to funds—particularly for middle-income countries such as Colombia—while large donors redefine their strategies, creating signaling effects that shape the allocation of resources across sectors.

These challenges unfold amid urgent needs: achieving the Sustainable Development Goals (SDGs) by 2030 requires between USD 3.3 and 4.5 trillion annually, yet there remains a financing gap of approximately USD 2.5 trillion. ODA reached USD 240 billion in 2023, still insufficient to meet global needs, and the situation in education is especially critical. In 2023, ODA for education amounted to just USD 9.56 billion, continuing its downward trend despite growing demand for equitable and quality education worldwide.

Against this backdrop, the author is pioneering in Colombia an alternative model of financing education through the creation of a social impact holding. Rather than financing individual programs, the author invests directly in organizations—both nonprofit and for-profit—that operate across the entire educational trajectory, from early childhood to youth development. These organizations share a growth and impact mindset, while also recognizing the need to harness market forces to achieve financial sustainability. This approach aims to reduce dependence on increasingly uncertain and scarce philanthropic flows, particularly those originating in the Global North, without compromising impact. Instead, it enables organizations to undertake structural changes in their business models, strengthening their capacity to scale and transform educational opportunities. This shift represents a paradigm change in education finance: moving away from short-term, donor-driven projects toward long-term institutional resilience rooted in local contexts. Within this holding, early childhood education plays a central role. The authors work with a local partner exemplifies how catalytic capital can expand access to high-quality early learning opportunities for the most vulnerable children, while also advancing systemic change in how early education is valued and financed.

By positioning education organizations as sustainable and impactful actors, rather than temporary recipients of resources, this model reflects a decolonial approach to financing—one that prioritizes local ownership, reimagines financial architectures, and places equity and social transformation at the heart of educational investment.

Author

• Alejandra Montes, FUNDACION CARULLA