With $48M in philanthropic backing, a division of USAID relaunches as a nonprofit

USAID Innovation Division Reborn as Independent Nonprofit After Trump Cuts

A key division of the U.S. Agency for International Development that fell victim to Trump administration budget cuts has found new life as an independent organization. The Development Innovation Ventures (DIV), formerly part of USAID, officially relaunched Thursday as the nonprofit DIV Fund, backed by $48 million from private donors.

The revival comes in the wake of sweeping changes that saw the Trump administration freeze all foreign funding and deploy Elon Musk’s Department of Government Efficiency to dismantle the 60-year-old agency responsible for distributing U.S. foreign aid. The cuts resulted in tens of thousands of job losses and disrupted critical humanitarian programs worldwide.

While numerous private initiatives emerged to preserve USAID’s vast knowledge base and maintain essential programs, few have secured the level of philanthropic support achieved by the DIV Fund. The organization’s rebirth was celebrated at a Washington think tank event where former staff, funders and grantees gathered with a sense of determination and hope.

“The loss of US government support is a huge blow,” said Michael Kremer, the DIV Fund’s scientific director and 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.”

Some of the nonprofit’s leadership previously helped direct $110 million in private philanthropy to projects that lost USAID funding over the past year. The DIV Fund now aims to distribute $25 million annually, representing slightly more than half of DIV’s former budget within USAID.

Several factors have contributed to the organization’s fundraising success. The DIV Fund operates as a research and development hub that identifies cost-effective interventions and supports their expansion to scale. This focused approach requires significantly less funding than large-scale programs addressing issues like HIV prevention or famine response.

Additionally, while operating within USAID, DIV had already established relationships with outside philanthropic funders, including a $45 million grant from Coefficient Giving, a San Francisco-based organization that now serves as one of the nonprofit’s anchor donors. The other major funder wishes to remain anonymous.

Kremer noted that DIV-supported programs typically secure funding from local governments or generate their own revenue, rather than relying indefinitely on donor countries like the United States. This self-sustainability model has become increasingly crucial as traditional donor nations reduce their foreign assistance commitments.

Of the $48 million raised so far, $20 million has been allocated to former recipients, leaving $28 million for future grants. The fund will initiate an open call for applications this year, a process valued for its ability to generate innovative ideas.

While operating within USAID, DIV often influenced other departments and secured additional support for endorsed projects. Now operating independently, the DIV Fund plans to collaborate with major donors like the World Bank and other countries to implement their recommendations and develop similar research funds.

“It just matters a ton if that money is going towards things that are highly effective or moderately effective or not effective,” said Otis Reid, executive director of Global Health & Wellbeing at Coefficient Giving. “And I think DIV can play a really crucial role in moving things from the not effective to very effective part of the spectrum.”

Many DIV-supported programs undergo validation through randomized control trials. However, Kathryn Oliver, a professor at the London School of Hygiene and Tropical Medicine who studies evidence-based policy, cautions that while these trials excel at evaluating intervention effectiveness, they don’t address all relevant policy questions such as public acceptance or comparative approaches.

As a new nonprofit, the DIV Fund remains open to collaborating with the U.S. government, according to cofounder Sasha Gallant. This comes despite Secretary of State Marco Rubio’s characterization of USAID as “corrupt, costly and ineffective” and his claims that foreign aid creates permanent dependency. Though the administration significantly cut foreign aid funding in 2025, Congress recently allocated $50 billion for various foreign assistance programs, substantially exceeding the administration’s request.

DIV had previously garnered bipartisan support largely due to the high return on investment its programs delivered—an attractive metric for philanthropic funders. While the DIV Fund won’t replace funding for established large-scale programs or costly but essential humanitarian responses, Gallant emphasized their hope that donor countries will continue supporting these critical initiatives.

“We absolutely should be delivering en masse the things that increase people’s livelihoods and save their lives and keep kids in school,” she said.