The next time you're looking at a charity, don't ask about the rate of their overhead. Ask about the scale of their dreams.

Dan Pallotta is a prominent critic of the nonprofit sector’s fixation on “overhead” ratios (administration and fundraising costs) as the primary measure of a charity’s worth. The quote reflects arguments he popularized in the early 2010s—especially in his widely viewed TED talk and related writing—contending that pressure to minimize overhead discourages nonprofits from investing in talent, marketing, technology, and growth. In that climate, donors and watchdogs often rewarded low spending on infrastructure even when it limited impact. Pallotta’s line reframes donor evaluation away from simplistic efficiency metrics toward ambition, capacity-building, and the potential scale of social outcomes.

The quote argues that judging charities primarily by overhead is a category error: it treats investment in organizational capacity as waste rather than as a means to achieve larger results. “The scale of their dreams” points to vision, strategy, and the magnitude of the problem a charity aims to solve—implying that meaningful change often requires risk, experimentation, and spending that may raise overhead in the short term. Pallotta’s challenge is ethical as well as practical: donors should ask what impact is possible, not merely how cheaply an organization operates. The line functions as a corrective to a culture of austerity that can keep nonprofits small and cautious.