How Will Millennials Give? 5 Questions for Sharna Goldseker, Managing Director, 21/64
July 23, 2013
Earlier this year, Sharna Goldseker and her colleagues at 21/64, a nonprofit consulting practice, in partnership with the Johnson Center for Philanthropy at Grand Valley State University, released the findings of a study of high-capacity donors between the ages of 21 and 40. In publishing those findings, Goldseker and her colleagues hoped to reflect back to these Millennials donors what they were saying about themselves so as to help them become more proactive as both donors and agents of social change, encourage and inform conversations about philanthropy among multiple generations, and help those who seek to engage and assist these next-gen donors to do so in more effective and productive ways.
Laura Cronin, a regular contributor to PhilanTopic, recently spoke with Goldseker about the priorities of this new generation of philanthropists and what makes them different from their parents and grandparents.
Laura Cronin: Your consulting firm, 21/64, specializes in next-gen and multi-generation philanthropy. How did you get involved with generational issues in philanthropy, and how does a generational approach help both experienced and younger donors be more effective?
Sharna Goldseker: In my previous job as a program officer at a multi-family foundation office, I discovered that the quality of the grantmaking conversation often relied on family members' ability to communicate with one another. So, in addition to researching and assembling dockets, I began to work with the executive director to prepare trustees in advance of board meetings. Typically, she would meet with the older trustees, and I would meet one-on-one with younger family members. It was through that process that I first learned the value of understanding an issue from the vantage point of everyone around a board table -- even next-generation family members who might not be expected to have a voice in the decision-making process.
When we established 21/64, we held core this idea that every family member involved in a family foundation should be empowered to bring his or her own values, experiences, skills, and voice to the table. And since then, we have found that when everyone is involved in the deliberative process and listening well, the whole is more effective than the sum of its parts. One of our goals is to help families establish that kind of healthy communications process and put systems in place that will keep it going long after our involvement with the family has ended.
LC: Much of the discussion about Gen X and Millennial donors focuses on impact. We've all heard that younger donors love data, love to do their homework, and are pushing grantees to demonstrate results. In what other ways do next-gen donors differ from older donors?
SG: We know that next-gen donors like to develop close relationships with, and play active roles in, the organizations they support. In the #NextGenDonors report we co-produced with the Johnson Center for Philanthropy, we talked about how next-gen donors are eager to contribute their time, talent, and ties in addition to their treasure. And while "time, talent, and treasure" isn’t a new concept in the donor community, next-gen donors do seem interested in offering those resources in pretty specific ways. They want, for example, to engage with the causes they are passionate about and to solve problems now, not just support organizations that are doing good work. And they are willing to explore non-traditional avenues to achieve their philanthropic goals, whether that means working with social entrepreneurs, investing in B-Corps, or making mission-related investments. The next-generation donor wants to hear about the challenges a grantee is grappling with and offer his/her talents to that grantee in a meaningful way.
Not all nonprofit leaders and development professionals understand how much next-gen donors want to be engaged in the organizations they support. Our hope is that our research will help nonprofits better understand how to work effectively with next-gen donors to produce sustainable solutions to a host of social ills.
LC: In the #NextGenDonors report, you noted that Gen Xers and Millennials stand to inherit more than $40 trillion in wealth over the next twenty to thirty years and go on to suggest that much of that wealth will end up being allocated to charitable causes. How did you arrive at that estimate, and how can nonprofits and others who are working to create social impact put themselves in a position to benefit from those resources?
SG: The $40 trillion figure came from Paul Schervish and John Havens at the Center for Wealth and Philanthropy at Boston College. Since they first released research on the coming intergenerational transfer of wealth in 1998, they've updated their findings with supplementary research and confirmed that some $20 trillion of the total will go to philanthropic causes through bequests, which they call "inter vivos" giving. Given the magnitude of the dollar amounts likely to be dedicated to philanthropic causes with significant input from Gen Xers and Millennials, and given how little is known about this multi-generational cohort, we partnered with the Johnson Center to study how this rising generation might impact philanthropy and society through their giving. Now, we're starting to take a closer look at some of the sub-samples within the dataset and are inviting folks to visit the site and follow us on Twitter (@nextgendonors) and Facebook as we roll out additional findings this summer and into the fall.
LC: Your report has some interesting findings regarding generational priorities. What funding areas are emerging as most important to next-gen donors? And how do they differ from what their parents and grandparents cared about?
SG: Next-gen donors are very respectful of the legacy of previous generations, much more so than we expected. Their philanthropy is largely driven by values inherited from their parents and grandparents, and we are seeing continued support in areas such as education and social service provision. We're also seeing growing interest in animal rights and the environment, advocacy, and civil rights, and somewhat lesser interest in the arts, religion, health, and youth and families.
However, the major difference lies in how they plan to approach philanthropy. While many of them perceive their parents and grandparents to make funding decisions based on feelings of obligation and responsibility, next-gen donors want to make those decisions based on strategy and impact. They consider root causes, organizational effectiveness, and potential solutions before making decisions about what and whom to support and won't automatically support an organization just because their family might have had a long-standing relationship with it.
LC: Some of the largest fortunes in recent years have been amassed by tech entrepreneurs in Silicon Valley. Do the professional frames of next-gen donors influence the way they approach their giving?
SG: Their backgrounds and experiences definitely play a role in the way they approach their giving, but not necessarily a leading one. On a scale of one to four, with four being "most important" and one being "least important," our survey respondents rated "connecting philanthropic activities with professional activities' as a two and a half. That said, next-gen donors will often look to their professional peers for thoughts and suggestions about organizations they should support philanthropically, and they are eager to recommend causes to their peers. That, in turn, requires them to be more thoughtful because their peers often want to hear the reasons why a gift is strategic and will achieve the impact they want it to achieve.
-- Laura Cronin