USAID and For-Profit Companies: A Partnership for Global Development

USAID's New Partnerships Initiative: An Overview

The U.S. Agency for International Development launched the “New Partnerships Initiative” (NPI) in 2019. The goal was to foster a world that is more secure, healthy, and economically thriving for all populations.

Essentially, NPI aims to facilitate collaboration between USAID and local nonprofit organizations involved in humanitarian efforts. This is achieved through identifying novel partners and funding opportunities, simplifying resource access, and empowering local leadership.

Training and capacity building are also key components of the NPI framework.

Limitations of the Current NPI Legislation

Despite its positive intentions, the current NPI legislation presents certain constraints. Specifically, for-profit organizations are ineligible for NPI funding.

Furthermore, congressional set-asides intended for small businesses have often been utilized by established industry players and former government contractors.

It’s important to note that many significant advancements in global development have originated from for-profit companies, including those based in low- and middle-income nations.

Premise's Early Collaboration with USAID

Premise first partnered with USAID in 2016, a milestone the organization greatly valued.

USAID, through a Grand Challenge grant, commissioned Premise to develop tasks for its network of Contributors. The objective was to locate and eliminate mosquito breeding grounds.

Over 7,000 citizens participated in this initiative across three Colombian cities, providing authorities with crucial mapping data to pinpoint high-impact areas.

Continued Partnership and Advocacy

Since 2016, the Premise platform has supported over 20 USAID-funded projects. These projects leverage the platform to obtain data-driven insights for both activity design and evaluation.

As a founding member of Unlock Aid – a coalition dedicated to driving systemic change in global development – Premise continues to collaborate with USAID.

This collaboration focuses on advocating for legislative improvements, such as enhancements to the NPI.

Unlock Aid unites innovative organizations to promote structural changes in the global development sector.

The New Partnerships Initiative Legislation

In July 2021, Senators Tim Kaine and Marco Rubio presented the New Partners Initiative (NPI) legislation, aiming to reform USAID’s operational procedures.

This bill proposes authorizing $250 million over a four-year period. The intention is to streamline the process for new organizations to access foreign aid and execute programs.

Positive Impacts of the NPI

The NPI legislation is expected to generate several beneficial outcomes. While the NPI was initially established in 2019, the 2021 bill formally allocates substantial funding to new and currently underutilized partners.

Furthermore, it instructs USAID to employ solicitation methods that reduce obstacles to participation. The legislation also mandates simplified reporting procedures for recipients.

A yearly report to Congress detailing the implementation of the NPI program is also required by this legislation.

Support and Considerations

Organizations like Unlock Aid and Premise express support for the legislation. However, they emphasize the importance of including for-profit entities within the definition of “new partners,” alongside nonprofits.

USAID’s Evolving Vision

In November, Administrator Samantha Power articulated a revised approach to global development during a speech at Georgetown University.

This new vision explicitly incorporates the involvement of for-profit companies in international aid initiatives.

Challenges in Tech Collaboration with USAID

Tech firms often encounter difficulties when attempting to collaborate with USAID, stemming from a fundamental mismatch between traditional commercial strategies and USAID’s operational framework.

A primary obstacle lies in USAID’s frequent failure to assess the viability of utilizing pre-existing commercial solutions to achieve its goals.

The Current Model and its Limitations

Currently, each project undertaken by USAID is uniquely designed by an implementing partner. These partners are compensated based on implementation efforts, rather than demonstrable outcomes.

A shift towards greater reliance on established products and services – those with applications extending beyond international development – could significantly amplify USAID’s overall impact.

Precedents Within the U.S. Government

Instances within other branches of the U.S. government demonstrate the potential benefits of this approach.

Palantir and SpaceX both successfully challenged their unlawful exclusion from competing for government contracts in federal court.

The Core Argument for Fair Competition

The central tenet of both companies’ arguments was consistent: government entities must prioritize evaluating commercially available options before initiating the development of bespoke products and programs.

In 2014, when SpaceX initiated its legal action, Elon Musk, as reported by NBC News, clarified that the suit wasn’t about securing contracts, but rather advocating for a competitive bidding process.

Palantir’s Victory and its Implications

Following Palantir’s successful lawsuit against the Army, their legal counsel, Hamish Hume, announced a court injunction.

This injunction mandated the Army to consider commercial offerings, including Palantir’s proposed solutions.

Hume emphasized the broader significance of the ruling, stating, “This is a victory not just for Palantir but for taxpayers and our whole procurement system.”

He further predicted that the decision would incentivize innovation and encourage companies like Palantir to actively pursue government contracts.

Seeking Similar Opportunities in International Development

Innovators dedicated to fostering a free, peaceful, and prosperous world are now seeking comparable opportunities within the international development sector.

They aim to leverage existing commercial products and services to maximize the effectiveness of development initiatives.

This represents a desire to contribute to increased development impact through the application of proven, readily available technologies.

Expanding the Scope of the New Partnerships Initiative

The New Partnerships Initiative (NPI) represents a potentially groundbreaking approach for USAID to amplify its global influence. However, to maximize its effectiveness, the initiative must consider the valuable contributions of for-profit organizations, alongside traditional non-governmental organizations (NGOs). These businesses often possess substantial investment capabilities.

Excluding for-profit entities from the NPI would limit access to a wealth of scalable, innovative solutions. We encourage USAID to reassess the current restrictions and recognize the potential benefits of broader participation.

A fundamental shift in an entire sector, as demonstrated by companies like SpaceX and Palantir, necessitates the engagement of a diverse coalition of stakeholders. This includes not only governments and NGOs, but also active members of civil society.

Leveraging Technological Expertise

Should the NPI broaden its scope to include technology companies, USAID would gain access to pre-existing tools and readily available solutions. Integrating for-profit businesses into the NPI framework is a crucial initial step towards achieving this goal.

Collaboration with the private sector can accelerate the implementation of impactful projects. This approach fosters innovation and efficiency within USAID’s initiatives.

Ultimately, a more inclusive NPI will be better positioned to address complex global challenges. By embracing diverse partnerships, USAID can unlock new levels of development impact.