Data-Driven Giving Maximizes Charitable Impact Through Cost-Effectiveness

Key Quotes

"For almost a decade, GiveWell has dedicated itself to rigorously researching the impact of charities around the world and channeling donations to the ones that are the most effective at saving lives. It might sound simple, but this was a radically new approach in the world of charitable giving, and the work itself isn’t simple at all."

Elie Hassenfeld explains that GiveWell's mission is to identify and fund the most impactful charities, a novel approach in the philanthropic sector. This rigorous research process is fundamental to their work, aiming to maximize the good achieved with donated funds.

"I think the thing it taught me most is how challenging it is to know anything. I spent about a year just studying Talmud and in that year after high school it was the first time that I think I had a really challenging intellectual experience where I wasn't able to understand the text and the content that I was trying to but nevertheless found myself drawn to understand it and to deal with the layers of challenge that the text presented."

Hassenfeld reflects on his academic study of the Talmud, highlighting how it cultivated an appreciation for intellectual rigor and the difficulty of discerning truth. This experience shaped his approach to complex problems, emphasizing the importance of grappling with challenges rather than seeking easy answers.

"The core idea that was true then and I think has carried through in GiveWell and in my life today was, you know, first, in order to make decisions about what to do in the world, we have to understand the world accurately. And for a hedge fund, understanding reality is really key. If you are right, you make money; if you are wrong, you tend to lose money. And so the stakes of getting to the quote unquote truth are very high."

Hassenfeld draws a parallel between his experience in finance and his work at GiveWell, emphasizing the critical need for accurate understanding of reality. He explains that in both fields, the consequences of being wrong are significant, underscoring the high stakes involved in seeking truth.

"We just started asking some really basic questions and the answers we got back were shocking. So we each researched a different cause. I decided to research the cause of water in Africa. I'd call up well, first we looked at Charity Navigator and at the time Charity Navigator essentially just reported financial metrics... I called the organizations up and asked them, 'Well, so, so what do you do? What do I get if I give you money?'... they just didn't have answers."

Hassenfeld recounts the genesis of GiveWell, detailing how initial inquiries to charities revealed a lack of clear, impact-focused data. He highlights the inadequacy of financial metrics alone and the surprising absence of answers to basic questions about program effectiveness from the organizations themselves.

"I think there's two big things that happen and then there's a many more that are downstream. The first is as an individual running an organization, you have an incentive for your organization to succeed and it's very difficult to look for information that would mean your organization is not succeeding or shouldn't receive money. It's just, it's, it's not, I think, it's not realistic to expect someone who, say, is running an organization that delivers food in a way that is very cost-inefficient to determine that they should shut that program down and move on to something else. That's just not how human beings operate."

Hassenfeld identifies a core challenge in the non-profit sector: the inherent incentive for leaders to prioritize their organization's success over objective evaluation. He explains that this human tendency makes it difficult for organizations to self-critique or admit ineffectiveness, even when faced with data.

"I'm always struck by how few charities actually make it into your top charities and it's pretty, it has been fairly stable year to year now for some years. So walk me through what they are and what makes you confident in them. Yeah, let me, um, let me first, if it's okay, like frame up how the top charities fit into our overall work. So in 2025, we've directed funds to 70 organizations, four of them are our top charities."

Hassenfeld clarifies GiveWell's methodology, explaining that their "top charities" represent a small, highly vetted subset of organizations. He notes that while they fund many charities, only a select few meet their stringent criteria for evidence, track record, and data, indicating a high bar for inclusion.