1827 posts categorized "Philanthropy"

What the donor-advised fund payout rate means for philanthropy and how it fits into the bigger charitable giving picture

June 08, 2021

Those of us who work with donor-advised fund (DAF) donors every day know that they are caring, committed, and creative givers. We also know they use DAFs for both their long- and short-term giving. This has never been more apparent than in the past year, when grantmaking from DAFs skyrocketed in response to the COVID-19 pandemic. While generosity is not a calculation, the DAF payout rate is an important philanthropic benchmark.

What is the DAF payout rate?

The DAF payout rate is a calculation of grantmaking dollars awarded from DAFs to charities relative to the total charitable assets in those DAFs. More simply: it's how much DAF donors granted compared with what they could have granted.

How should we calculate payout rate?

Candid uses a formula to estimate payout from private foundations that National Philanthropic Trust (NPT) replicates in our annual Donor-Advised Fund Report. The Candid formula is:

This year's grant $$ ÷ Previous year's charitable assets = payout rate

For 2019, the latest year for which aggregated data is available, the formula is:

FY19 grants ÷ FY18 charitable assets

or $27.37B ÷ $122.18B = 22.4% payout

NPT uses the Candid formula for several reasons. First, like DAFs, private foundations are widely used giving vehicles for both short- and long-term philanthropy, so using the formula creates a useful point of comparison between the two types of vehicles.

Second, the formula is not just an industry standard, it's practical. The Candid formula reflects common budgeting techniques — that is, plan for the current year based on the prior year's income and expenses and factor in the remaining balance (if any).

Third, other payout-rate formulas ignore certain practical and particular aspects of giving to and from DAFs, such as the time between the date of contribution and the availability of the funds for grantmaking. More on this below.

A look at other ways to calculate payout rate

Since there is no mandatory payout requirement for DAFs, there are several reasonable ways to calculate it.

Thumbnail_DAF Payout Blog_Chart_2

The "Three-Year Average" and "Five-Year Average" methods use the average of the charitable assets held by DAFs over two different periods. These formulas are also allowed by the IRS as a way for private foundations to calculate their payout. Using multiyear averages can smooth out any "lumpiness" in either major contributions or grants. However, for fast-growing giving vehicles such as DAFs, it also generally underestimates charitable assets available, as the year with the highest total — typically, the most recent year for which aggregate data is available — is averaged with lower values from earlier years.

The "One-Year" method, a formula that NPT used to calculate DAF payout in our annual Donor-Advised Fund Report prior to 2014, uses grants and charitable assets (plus grants) in the same year to calculate payout. This formula assumes that every dollar contributed to a DAF can be immediately granted out, which can have the effect of overestimating the value of assets that are truly available for grantmaking.

For example, a donor who contributes to her DAF in the last days of December (and receives her tax deduction at that time) will recommend grants from those DAF charitable assets the following year and beyond.

How do we put the DAF payout rate into context?

The Candid method offers the best point of comparison. As a vehicle for giving, private foundations are similar to DAFs, and this method most accurately represents payout by using numbers that reflect the amount granted relative to what is definitively available for grantmaking.

It's also worth noting that private foundation payouts can include eligible operating and administrative expenses, such as staff salaries, overhead, and administrative expenses. By contrast, DAF payout takes into account charitable grantmaking only and does not include any of the DAF sponsors' operating or administrative expenses.

Using the Candid method, DAF payout is typically at least four times higher than that of private foundations. While foundations typically grant out the legally required minimum of 5 percent of their assets annually, the DAF payout rate has been above 20 percent for each of the last ten years.

All of the proposed formulae show that the DAF payout rate is historically and consistently higher than that of private foundations. And as such, it helps us understand that DAF donors are committed to the charities they support over both the short and long term.

DAFs provide substantial and sustained support

A consistent DAF payout rate is good news for charities. DAF donors have proven that they are a sustainable source of charitable support. They give dependably across economic cycles (yes, DAF donors gave at a 20+ percent payout rate through the Great Recession); through political seasons (no, there's no need to worry that campaign giving reduces charitable giving by DAF donors); and in the face of great challenges (natural disasters, global pandemics, mass social movements, etc.). The data is clear: DAF donors are committed to the long-term viability of nonprofits.

The DAF payout rate is an important metric, and it's not the only way to measure philanthropic activity from DAF donors. Grantmaking from DAFs has nearly doubled over the last five years — a clear signal that DAF donors are active givers. In fact, growth in grantmaking from DAFs (93 percent) has outpaced growth in contributions (80 percent) to them over that period.

DAF donors' response to the COVID-19 global pandemic — which saw grantmaking from DAFs soar 33 percent on a year-over-year basis — is yet another indication of their philanthropic commitment. So is the fact that they have irrevocably donated money to DAFs that can only be used for philanthropic purposes.

While there is no magic formula that can make people give, DAF donors have consistently chosen to do so quickly and generously.

Andrew Hastings_NPT_PhilanTopicAndrew Hastings, chief development officer at the National Philanthropic Trust, the largest national nonprofit manager of donor-advised funds, has twenty-five years of experience in the philanthropic and nonprofit marketplace. To read NPT's annual Donor-Advised Fund Report or COVID Survey, visit NPTrust.org.

Venture philanthropy: The secret weapon for unlocking biomedical research's full life-changing potential

June 04, 2021

Eye_retina_gettyimages_batkeMore than a year into the COVID-19 pandemic, there has been much reflection around "lessons learned" across all sectors. In the biomedical research space, we've seen science meet the urgent need for safe and effective vaccines at miraculous speed to contain the spread of the virus. The mRNA technology used in some of those vaccines has broad implications for future treatments for a variety of other viruses, cancers, and diseases and is a clear indication of how far science has evolved in a short period of time. Imagine what treatments and cures could be unlocked — with the necessary funding.

In the United States, public funding for basic research has long come from the National Institutes of Health, but the U.S. government lags other advanced economies in the amount of funding it provides for the translational research required to convert basic science into tangible patient treatments. And while more public funding for biomedical research at the critical clinical trial stage is essential, it is going to take public, private, and philanthropic dollars to ensure that biomedical research into promising treatments and cures doesn't wither on the vine. Federal programs such as the Cancer Moonshot, state-level initiatives like the California Institute for Regenerative Medicine, and promising legislation aimed at providing private-sector loans to companies developing novel treatments for disease and disability are all helpful — but still leave a funding gap. There needs to be a third leg to stabilize those public- and private-sector efforts, and we believe that third leg is philanthropy.

As successful entrepreneurs and venture investors, we see our donations as investments in the mission of the nonprofit organizations we support. We each have a personal connection to the mission of the Foundation Fighting Blindness: one of us has experienced loss of sight from retinitis pigmentosa as a young adult, and the other has raised two sons with vision impairment caused by Stargardt disease. Based on our personal experiences, we have a keen understanding of what it is like to be a patient or have a loved one waiting for life-changing treatments to become available.

For fifty years, thanks to the generosity of donors, the Foundation Fighting Blindness has successfully funded research in pursuit of treatments and cures for the entire spectrum of inherited retinal diseases (IRDs) and dry age-related macular degeneration (AMD), which together affect more than two hundred million people globally. Yet, more needs to be done. The key discoveries made in labs need to make it into the hands of industry-led therapy developers to conduct clinical testing and win FDA approval. But a gap in funding often prevents this progress, and in this case, the science is now outpacing the funding.

To bridge this funding gap, the Foundation Fighting Blindness created the Retinal Degeneration Fund (RD Fund), a nonprofit, pure-play venture philanthropy investment vehicle designed to help accelerate the technical aspects of the organization's mission and advance its financial goals. Our respective family foundations contributed significant capital to launch the fund, which allowed us to be more involved in the organization's work by funding highly visible activities in biotech startups and spinouts. We've taken concepts and techniques from our venture capital finance and business management experience and applied them to our philanthropic goals of accelerating the progress on treatments and cures, while positioning the organization for long-term sustainability.

Launched in late 2018 with $72 million under management, the first fund is now 90 percent committed, with nine investments plus reserves. This invested capital has attracted an additional $400 million in capital to date from institutional co-investors and has produced its first exit with the sale of Vedere Bio to Novartis for $280 million, enabling the organization to plug a financial gap in its long-range science spending plan and roll over significant funds to seed Fund 2. 

We take comfort in knowing that the venture philanthropy model already has been successfully scaled by the Bill & Melinda Gates Foundation, the Cystic Fibrosis Foundation, and the Juvenile Diabetes Research Foundation, just to name a few. One key element is to manage it professionally and deliberately; one cannot just wander into biotech equity investing without experience, deep scientific know-how, and world-class advice and oversight. The RD Fund has an independent board of directors with expertise spanning retinal biology, clinical ophthalmology, finance, and entrepreneurship, and the board works closely with an executive management team with significant operational, strategic, and leadership experience. Importantly, the fund is able to rely on an international scientific advisory board and leverage the organization's patient registry and clinical consortium. In other words, the brain trust of the Foundation Fighting Blindness and its venture arm have the collective scientific and business acumen to best determine what is or is not an investible mission-related opportunity.

We are encouraged by venture philanthropy's ability to reap a return to be re-invested in furthering an organization's mission, especially in times of economic uncertainty. Most important, our experience has demonstrated that jump-starting the pipeline for treatments and cures through venture philanthropy holds real promise as a viable, scalable approach for addressing other underserved diseases impacting so many.

(Photo credit: GettyImages/Batke)

Gordon Gund_Paul_Manning_PhilanTopicGordon Gund is chair and CEO of Gund Investment Corporation; after losing his sight from retinitis pigmentosa in 1970, he co-founded the Foundation Fighting Blindness with his wife, Lulie, and others. Paul Manning is founder, chair, and CEO of PBM Capital; both of his sons were diagnosed with Stargardt disease.

What COVID-19 has taught us about the humanitarian system and women's rights organizations

June 02, 2021

CFTA_feminist_humanitarian_networkWhen the COVID-19 pandemic struck — and with it came public health measures including stay-at-home orders — women's rights organizations (WROs) the world over were quick to sound the alarm: Gender-based violence (GBV) would increase. Women and "marginalized" groups would be disproportionately impacted by the pandemic, and the inequality they already face would deepen. The gendered impacts of crises are well documented, and COVID-19 would be no different.

WROs acted swiftly to address those issues, working to strengthen community-based mechanisms to ensure that women could report GBV and expect a response. Organizations adapted their systems and approaches to ensure that women could continue to access critical services during lockdowns, including psycho-social support, maternal and newborn child health care, and sexual and reproductive health services. WROs also advocated for recognition of the impacts of the crisis on women's rights and called for funding to be targeted to mitigating those impacts.

While responding to the pandemic and its fallout, WRO members of the Feminist Humanitarian Network (FHN), a collective of women leaders working together to transform the humanitarian system into one that is guided by feminist principles, saw an opportunity: Here was a moment to document the essential role WROs play in humanitarian action, to capture the work that they do, any time an emergency occurs, to ensure that women and "marginalized" groups aren't left out of relief efforts.

FHN member organizations — of which 70 percent are WROs working in the Global South and 30 percent are international non-government organizations (INGOs) and organizations based in the Global North — are working to achieve a global humanitarian system that is responsive, accountable, and accessible to women and the diverse organizations that serve them, and that challenges rather than perpetuates structural inequalities. A pervasive lack of recognition of WROs as humanitarian actors and leaders is just one of a number of critical issues that FHN is working to change.

The current humanitarian system and the actors it is comprised of (governments, United Nations agencies, INGOs, and national actors) systematically exclude women and their organizations from all phases of humanitarian action, from funding to decision making. WROs are rarely invited to contribute to national planning processes for humanitarian response or to sit on emergency committees. When a funding call is made, WROs rarely receive the information, and when they do, rarely succeed in their grant applications.

Needless to say, the impacts of this exclusion are enormous. Women's needs — and indeed, the needs of "marginalized" groups, such as people with disabilities, refugees, and the LGBTIQA community — go unaddressed as a result. WROs and women-led organizations, which often represent diverse groups of women and their communities, are uniquely positioned to highlight the needs of those they work with and ensure that they are addressed. When the leadership role of those organizations is undermined, basic requirements like including sanitary supplies in relief distributions and ensuring that distribution sites are accessible to people with disabilities are overlooked.

In addition to presenting an opportunity to showcase the role that WROs working at grassroots, local, and national levels play on the frontlines of humanitarian action, COVID-19 offered a snapshot of the global humanitarian system — how the current system works and the challenges it presents for WROs in the Global South — the patriarchal and colonial practices embedded in the system that are at the root of the lack of recognition, lack of access to resources, and exclusion that WROs experience.

And so FHN members in Bangladesh, Kenya, Lebanon, Liberia, Nepal, Nigeria, Palestine, and South Africa – conducted research to document their own humanitarian leadership, and that of their peers in the response to the pandemic. Their findings have been published in a series of national reports and a global report entitled Women's Humanitarian Voices: Covid-19 through a feminist lens. The reports highlight multiple critical barriers presented by the humanitarian system that undermine the leadership of WROs, and describe not only their ability to respond to crises but their long-term sustainability as essential women's rights actors working to protect and advance women's rights.

In six of the eight studies, WROs were unable to access donor funding, in large part as a result of excessive due diligence requirements that these organizations, working around the clock to respond to the emergency with limited resources, were (particularly in times of crisis) unable to fill. Instead, WROs undertaking critical work — ensuring that women with disabilities were able to meet basic needs throughout the crisis, for example — funded their efforts with their leaders' personal resources or funds contributed by the community. At the same time, women and their organizations were excluded from decision-making processes — left out of planning undertaken by international and national actors and from emergency response committees at all levels.

And yet those organizations persevered, working collectively in the "spirit of sisterhood" to challenge injustice, demand that their voices be heard, and work to influence the response efforts — and ensure that women's needs were addressed in each context. WROs continue to take action so that women are not left behind in the COVID-19 response and women's rights are advanced through humanitarian action.

For many of us working in the humanitarian sector, the pandemic has re-emphasized much of what we already knew: Emergencies exacerbate gender injustice, in part because the humanitarian system reinforces existing patriarchal social structures by excluding women from funding and decision making. Women's Humanitarian Voices: Covid-19 through a feminist lens has captured the creativity, resourcefulness, and deep feminist approaches of WROs in the Global South and has presented a powerful argument for why that system must change.

To be part of that change and to create a system that is inclusive of all and creates sustainable, transformative change, humanitarian actors across the system must immediately increase support for organizations advancing women's rights, in the form of direct, long-term, flexible funding. They must recognize their expertise and follow their leadership. A feminist humanitarian system is not only possible; it is critically needed and requires every humanitarian actor — including, importantly, donors — to take action.

Holly_Miller_Naomi_Tulay_Solanke_PhilanTopicHolly Miller is lead at the Feminist Humanitarian Network, a global collective of women leaders working together to achieve a humanitarian system that is guided by feminist principles. Naomi Tulay-Solanke is executive director of Community Healthcare Initiative and a member of the Feminist Humanitarian Network Steering Committee.

5 Questions for...Marisa Franco, Co-Founder/Executive Director, Mijente

May 31, 2021

Marisa Franco is co-founder and executive director of Mijente and the Mijente Support Committee, a Latinx and Chicanx advocacy organization and digital and grassroots organizing hub. Founded in 2015, Mijente's campaigns have resulted in a number of electoral victories, including the defeat of Maricopa County sheriff Joe Arpaio in 2016 and the mobilization of record numbers of Latinx voters in Georgia and other battleground states in the 2020 presidential election.

Prior to founding Mijente, Franco served as national campaign organizer for the National Day Laborer Organizing Network and as lead organizer for the Right to the City Alliance. Earlier this month, Franco was elected to the board of the Marguerite Casey Foundation.

PND spoke with Franco about the politics of immigration enforcement, police violence against people of color, and philanthropy's role in supporting social movements.

Headshot_marisa_franco_mijentePhilanthropy News Digest: Given the growth of the Latinx population in the United States over the last few decades, it's no surprise that Latinx voters are going to the polls in record numbers. From your perspective, what are the factors driving greater voter participation in the Latinx community? And what are some of the obstacles to even higher levels of participation?

Marisa Franco: So much attention was given to the 2020 elections, and Latinx people, across the political spectrum, were definitely impacted. Like many communities, Latinx folks were witness to both the actions of those in elected office during the pandemic and the accompanying economic crisis, and many turned out to vote as a result. It was also the year Latinx people became the largest "majority-minority" group in the United States and came into its own politically. That said, last year was a sort of snapshot of the good, bad, and ugly of where our community stands with respect to realizing its own political power, and there is still much work to be done to nurture and grow our voter engagement. The challenge, in my opinion, is that if Latinos and Latinas don't see real change in their own lives, they will not feel the need to vote.

PND: Earlier this year, Mijente and the We Are Home campaign launched Eyes on ICE: Truth & Accountability Forums, an initiative to collect testimonies that shed light on U.S. Immigration and Customs Enforcement's current practices and policies, spotlight the stories of those who have organized to protest those practices and policies, and share solutions designed to address the worst abuses. How do you hope those testimonies will shape the Biden administration's immigration policies going forward?

MF: There is no question that immigrants were a primary target of the Trump administration. Biden campaigned to restore the soul of America — and immigrants undeniably should be included in that effort. With the Eyes on ICE campaign, we wanted to provide an outlet for people directly affected to register their experience with immigration officials. This information will be critical as the current administration reviews the scope and conduct of officials in the Department of Homeland Security. And, going forward, the participation and engagement of immigrant communities will be critical to undoing the harms of the past several years.

PND: The Mijente Support Committee's #NoTechForICE campaign calls "on every tech company that works with ICE to immediately halt its support for the agency." Are you seeing results from the campaign?

MF: Yes, we are seeing greater organizing efforts among tech workers, students, and shareholders. And it wouldn't have been possible if not for the research, advocacy, and campaigning we and our allies have done to bring public awareness to issues of surveillance. There is growing pressure across the globe to hold technology companies accountable for their actions, including companies that are positioning themselves inside the immigrant and criminal justice system; that is a key addition to the conversation around transparency and accountability.

PND: You've said the Marguerite Casey Foundation can help "seed the next iteration of social movement and organizing ecosystems" and lead the way forward for the philanthropic sector with respect to both supporting and operating with the same nimbleness as social movements. What would that look like? And what steps should foundations be taking to better align their strategies with the social movements they support?

MF: To me it looks like having a practice of being in dialogue and relationship with local leaders and organizations and developing a sense of emerging strategies and an organic network to local leaders. It is finding people doing good work and supporting them to do it better or at a larger scale.

PND: In your view, what should philanthropy be focused on with respect to Latinx communities? And what issues in the broader Latinx community are underfunded?

MF: Philanthropy has a lot of options it can choose from. One of our challenges at Mijente has been that at times it has felt like there are too many opportunities on the table. Youth are key, especially given that the average age of a Latinx person in the U.S. is approximately twenty-seven, making us one of the youngest demographic cohorts in the country. Because of what happened in the last election cycle, I also believe it's important to look at how we can counter mis- and disinformation directed at Latinx Spanish-speaking communities.

—Kyoko Uchida

How trust-based values can transform philanthropy

May 21, 2021

PhilanTopic_hands_collaboration_trust_GettyImages_Prostock-StudioWinston Churchill is credited with being the first to say, "Never let a good crisis go to waste." While the COVID-19 pandemic has resulted in immeasurable pain and suffering, it has also inspired action around how philanthropy can better address global crises in the future. At the start of the pandemic, more than eight hundred philanthropic organizations agreed to provide greater flexibility to and eliminate administrative barriers for their grantees. With a pandemic raging, funders who signed the pledge recognized they needed to act swiftly and to lean into the expertise of their nonprofit partners. By committing to the values of trust-based philanthropy, an approach to giving that seeks to address the inherent power imbalances between funders, nonprofits, and the communities they serve, the signatories to the pledge agreed to put faith in and share power with those hardest hit by the crisis.

As the world begins to emerge from the pandemic, the philanthropic community must resist the urge to return to the status quo. The need for such a pledge underscored the reality that funders need to do more to make their grantmaking accessible, equitable, and empowering for grassroots leaders. And they can do that by moving to a trust-based philanthropy model.

I know firsthand the power of trust and service. Before taking the helm at The Pollination Project, a micro-granting organization that provides funds to community leaders in support of early-stage projects, I spent a decade as a monk. Four values guided my daily life during that time: faith, humility, relationship, and service. All four show up in the trust-based philanthropy model and offer a framework for how funders — and our grantee partners — can better solve the global challenges of today, and tomorrow.

Here's how those values can reshape philanthropy:

Faith

Monks believe that everything in life is a dynamic proposition of faith. A trust-based funding approach is similar, in that it calls on funders to reevaluate their grant application process to allow more opportunities for smaller organizations. Automatically rejecting volunteer-led organizations or early-stage projects, for instance, closes the door to many deserving recipients.

Over half of the grant dollars awarded by U.S. foundations are directed to just 1 percent of recipient organizations. Black, Indigenous, and people of color leaders historically have been overlooked by philanthropy and often receive fewer grants, less money, and are given less freedom to decide how to use that money than their white counterparts. We are at risk of perpetuating these inequities unless we lead with faith and understand that those most directly impacted by an issue almost always are in the best position to solve it.

Directly investing in communities isn't just a moral issue; it works. For years, The Pollination Project has supported projects that mainstream philanthropy would likely deem risky, including providing seed funding to grassroots volunteers without a traditional educational background or nonprofit experience. But we go a step further than the current trust-based model by committing to an open application process through which anyone can share their vision for a project and seek funding. By providing grants directly to individuals, we allow those without access to other sources of institutional funding — especially underrepresented groups such as Indigenous people, women in the Global South, and religious and ethnic minorities — to launch impactful, meaningful projects. Take, for instance, a volunteer in Kolkata, India, who mobilized marginalized youth to manufacture hand sanitizer and distribute it to families living in urban slums at the start of the pandemic. Community leaders have the passion, skill, and trust to drive local efforts, and philanthropy should grant them the resources to do so.

Humility

Trust-based philanthropy recognizes that because philanthropic leaders don't have all the answers, they must redistribute and share decision-making power. Too often, those making funding decisions at nonprofits are disconnected from the communities they serve. Paternalism and elitism are deeply rooted in philanthropy, and it takes humility to give back some of that power.

A peer-to-peer giving model is one way to redistribute power. In such a  model, a network of grant advisors — none of whom is paid staff and most of whom are previous grant recipients — decide which projects receive our funding. By democratizing funding decisions, philanthropic organizations can address the inherent power imbalance between funders and grant recipients.

Relationship

The ability to forge meaningful relationships is critical to driving social change; in 2020, however, fewer than a third of foundations provided any assistance to their grantees beyond the grant itself. To make the greatest impact, funders must move from solely providing financial resources to viewing ourselves as a partner to our grantees and ensuring their long-term success by offering non-monetary support such as introductions to other funders, capacity-building training, and promoting their work to our networks.

Monks recognize the power of relationships. We lean into the vulnerability required to develop authentic relationships and find strength in connection. I've used these teachings to foster a global community of four thousand changemakers who share learnings, work to build capacity, and form community with one another. Smaller and people of color-led organizations typically don't have the same resources as larger nonprofits, which in turn drives inequities in the field. Philanthropic leaders can support the long-term success of such organizations by ensuring that their relationships with grant recipients don't end with a check.

Service

The trust-based philanthropy model recognizes that nonprofits currently spend a lot of time completing funder-required application forms and reports, which takes precious time away from their mission.

As philanthropists, we must remind ourselves to whom nonprofits are accountable and consider how we can be of more service to the ones we support. We must ask ourselves how we can minimize bureaucracy and free would-be change agents to do what they are called to do. Putting more value in conversations instead of written reports or applications allows small organizations with limited bandwidth to focus more on their work and on creating a kinder, more compassionate world.

One thing COVID-19 has taught us is that philanthropy works better when power is distributed equitably and those closest to the issues have the opportunity to lead. By embracing trust-based and monastic principles, philanthropic leaders can make a more direct and immediate impact in communities. Crises can be an opportunity to change things that no longer work; let's not waste this one.

(Photo credit: GettyImages/Prostock Studio)

AJ Dahiya_PhilanTopicAJ Dahiya is a former monk who is now a writer, speaker, and chief vision officer at The Pollination Project, a global community of four thousand-plus grassroots volunteer leaders in over a hundred and twenty-five countries.

Intentional philanthropy to diversify science

May 17, 2021

News_scientists-in-labLast week, Michael Bloomberg announced a $150 million gift to my alma mater, Johns Hopkins University, to provide permanent funding for a hundred STEM PhD students from minority-serving institutions. The gift is noteworthy not for its amount but rather for its potential to increase PhD attainment for Black and Latinx students in STEM fields.

The initiative has the potential not only to signal change but to drive it. In the decade from 2010 to 2019, the share of Black Americans among all PhD recipients rose just over half a percentage point, from 4.9 percent to 5.5 percent. Assuming that representation at Hopkins is reflective of the national data, Bloomberg's gift could double the number of Black and Latinx students in Hopkins PhD programs. It's an important start, but not enough; long-term change will require a sea change in culture across all STEM fields.

The National Institutes of Health (NIH) and other funders have been working to address the problem for decades, but several recent studies suggest that targeted funding at the PhD level does not translate to higher retention of Black and Latinx scientists in academia. A 2017 study found that Black faculty members made up only 0.7 percent of tenure-track faculty in biology across forty top institutions in the U.S., highlighting the dramatic attrition of Black PhDs over the course of the typical academic career trajectory. While most PhD scientists go on to have successful careers outside academia, it is nevertheless important to monitor the data for those who stay — not least because academic researchers play a key role in training future scientists, interfacing with clinical trial participants, and directing scientific inquiry. If Black scientists are choosing to seek other careers, we must stop to ask why and address the issues so that efforts to increase representation among scientists translate to all settings where scientists are engaged.

Funding, equity, and community

A decade ago, a study found that Black scientists were significantly less likely to receive a research grant from NIH than similarly qualified white colleagues. In 2019, NIH published a follow-up report showing that one contributing factor to the disparity was that Black researchers applied for funding in areas that were of lower overall priority to the federal agency. A seemingly obvious solution to the problem would be to encourage Black researchers to apply for grants in higher-priority areas. However, the critical questions should be: "Exactly who is determining health research priorities?" and "Are these priorities addressing the needs and perspectives of the whole population?"

Shifting to nonprofits and philanthropies, it is well documented that advisory recommendation boards lack diverse perspectives and are therefore less able to navigate and guide health research in ways that are most impactful for a diverse population. Increasing the diversity of the bodies that set priorities will feed back into research settings where Black scientists struggle to access funding for the topics they see as most important.

Beyond the differences in fields of study that Black, Indigenous, and people of color scientists choose, NIH has noted that the standard process by which scientific proposals are evaluated may drive disparities in funding. Overall, Black scientists are half as likely to receive key research grants from NIH. The agency has noted that proposals from BIPOC scientists are less likely to be discussed and, when discussed, tend to score lower on average. Given that the applications all came from highly accomplished researchers, the finding not only suggests systemic racism, it underscores how it is perpetuated.

Finally, funders and institutions must pay attention to how Black and Latinx student-scientists are supported when there are so few faculty members available to them. Nearly 6 percent of biology PhD recipients but only 0.7 percent of biology PhD faculty are Black — an imbalance that places a disproportionate amount of mentoring and role-modeling responsibilities on a relatively small number of faculty. Increasing diversity among STEM scholars and scientists must not come at the expense of increasing the workloads of BIPOC faculty. Funders and institutions can help address these challenges by providing more support for Black faculty and/or acknowledging the existence of these disparities in the review process.

Last fall, many of us celebrated MacKenzie Scott's investment in the endowments of historically Black colleges and universities (HBCUs). Today, we cheer Mike Bloomberg's effort to connect these programs to top-tier STEM PhD programs. And we hope his investment will set the stage for other funders, philanthropic and public, to support scholars of color at every stage of their scientific careers. All funders must take a deep, critical look at their priorities, vetting processes, and advisory protocols. After all, what better way is there to further the change you want to see?

Altimus-Cara_PhilanTopicCara Altimus, PhD, is a senior director at the Milken Institute Center for Strategic Philanthropy.

Strategies for nonprofit success in a post-pandemic landscape

May 11, 2021

News_keyboard_donate2A recent survey by the Nonprofit Finance Fund found that 60 percent of nonprofits experienced conditions in 2020 that threatened their long-term financial stability. As a result, most nonprofits had to reimagine how they engage with donors and the beneficiaries of their programs and services. Looking ahead, there are several strategies nonprofits can leverage to ensure their success in a post-pandemic world.

The power of storytelling

COVID-19 has underscored the importance of organizations staying connected to their mission and core values. Creativity and innovation are essential to engaging donors effectively, not only in terms of telling the "right story" but also in selecting the best virtual platforms to engage donors, who want to believe their contributions will have a direct impact on the causes they believe in.

Take the Downtown Women's Center (DWC) in Los Angeles. After the pandemic forced most things to shut down, the organization established a series of virtual community meetings to stay in touch with its clients; began to send regular email updates to donors, volunteers, and community stakeholders; and converted its largest fundraising event of the year — its annual in-person gala — into a virtual event. But its best move might have been the decision to adopt a peer-to-peer fundraising strategy. The resulting three-week campaign, Together Housed, encouraged donors and volunteers to leverage their own personal and professional networks on behalf of the organization, with DWC providing step-by-step instructions on how to set up a fundraising page, as well as email templates and social media content. Sure enough, at the end of three weeks the organization had exceeded its fundraising goal for the campaign by 35 percent and had secured support from eight hundred new donors.

Although grants from foundations tend to be top-of-mind for many organizations, the majority of giving to nonprofits comes from individual gifts and donations (Giving USA). No surprise, then, that building successful, long-term relationships with individuals is an important development strategy — and that donor retention strategies, including peer-to-peer fundraising and the use of third-party auction platforms, are critical.

Adaptive leadership is crucial

The pandemic also highlighted the importance of creativity and innovation for every organization. In the months and years ahead, nonprofits need to allocate time for experimentation and learning if they hope to adapt their programs and revenue-generating efforts to changing needs and opportunities. According to an article in the Stanford Social Innovation Review by Community Wealth Partners, the organizations that thrive during challenging times tend to have strong and decisive leadership able to make quick decisions in response to evolving challenges.

Nonprofits should also evaluate their boards to ensure that the composition of the board is appropriate for where the organization is in its lifecycle. As BoardSource notes, "High-performing nonprofit boards are both thoughtful and intentional in creating a strategically composed board of directors […] Every board's ideal composition should be considered in the terms of the specific needs, strategies and lifecycle of the organization as the board looks forward several years."

A recent article by sgENGAGE echoes the importance of investing in leadership. Organizations should invest in diverse talent and provide opportunities for employees at all levels to grow and develop.

Modernize to engage donors

Innovative virtual programming is the key to creating new revenue streams. Not only is such programming a good bet to generate additional funds, it also is a wonderful opportunity to reach audiences beyond an organization's traditional geography.

A great example of how it should be done is the Petersen Automotive Museum, which last year launched its first-ever virtual museum and vault tour. The tour, along with a number of other innovative programs designed to keep virtual visitors returning for more, enabled the museum not only to reach a wider audience but to raise much-needed funds from people who had never heard of it.

Do not delay digital transformation

In its most recent Nonprofit Trends Report, Salesforce highlighted the correlation between organizations with high levels of "digital maturity" and those with the most innovative and confident responses to change. According to the report, 85 percent of nonprofits say technology is important to their long-term success, yet only 23 percent have a long-term strategy or vision for how to use it.

In a digital-first environment, nonprofits must be able to leverage data to inform decision making, reach new audiences, personalize communications, and make accurate fundraising forecasts. And with a reasonable investment in a virtual platform, there's no reason to restrict outreach and programming to an organization's local geography.

The thing to remember is that what worked in the past is less likely to work today or in the future, so establishing and tracking key performance metrics and trends across key functions is essential. According to the latest Charitable Giving Report from the Blackbaud Institute, the share of giving done online has grown steadily over the last three years. If they hope to maintain and improve their donor retention rates, nonprofits need to be on board with online giving and other important trends in giving. And if those retention rates are not improving, or are falling, it's probably a sign that the organization is not directing enough resources to its donor engagement efforts.

Seize the day

The pandemic brought much of the world to a standstill, but things are beginning to open up. For nonprofits that took a hit last year, investing in technology to improve program service delivery and impact measurement is a good place to start. Organizations should also evaluate their internal processes to ensure they are as efficient as possible and that their strategic plan is still aligned with their programs and mission. And they should have regular conversations with key funders — not only to keep them engaged, but also to make sure that appropriate actions can be rolled out quickly if a funder decides to shift priorities or cut back on its support.

Community Wealth Partners agrees: "First and foremost, make time to revisit your vision for social impact — the impact you are trying to create and how you plan to create it. This helps ensure that your work remains relevant."

Whether the end to the pandemic comes in two months or two years, the need for the kinds of services provided by nonprofits is not going away. Nonprofits with forward-thinking leadership and staff that can keep up and innovate in an ever-changing digital world are most likely to thrive and create the greatest impact. No one says it's going to be easy, but the alternative isn't really an option.

Wilson_Donella_philantopicDonella Wilson, CPA, leads GHJ's Nonprofit Practice and serves as president and chief philanthropy officer at the GHJ Foundation. She was recognized in 2018 as a "Women Executive of the Year" and in 2017-20 as one of the "Most Influential Women in Accounting" by the Los Angeles Business Journal.

A case for self-support: serving ourselves in a time of great stress

April 30, 2021

Man_on_cliff_David Lusvardi_unsplash"How are you doing?" I asked a donor on a phone call last summer. Her response stayed with me. "I'm doing pandemic fine," she said, before explaining that that was the kind of response one gives during a public health emergency instead of something like: "I'm doing okay. I have my job, and it's stressful, but at least I have work. And the family is fine. No one is sick. Virtual homeschooling is a struggle, but we're fine."

Her response was both amusing and perplexing, because when I ask someone how they're doing, I'm the type of person who wants and expects to hear all the details. In fact, I believe it helps explain why I enjoy working in philanthropy as much as I do, and is one of the main reasons so many of my meetings run longer than scheduled.

Organizational experts Paul Davis and Larry Spears would call my exchange with the donor a "fortuitous encounter — "[t]hose moments where a person, place, or thing causes our lives to change in a more positive direction." While I did not feel all that positive after the exchange, in the months since it has contributed to a transformation in the way I think about taking care of myself, my colleagues, and our philanthropic partners.

Of course, the donor's reply was informed by the unprecedented events of the past year — events for which our sector as a whole was largely unprepared. I live in Houston, where hurricanes and flooding events are commonplace, but once the water recedes, we jump back in our cars and check on our friends, neighbors, and even our donors. The coronavirus pandemic, by contrast, has been a "silent" storm during which we've been encouraged to care for others by literally keeping our distance from others.

What fundraising professionals are doing well…and not so well

From a fundraiser's perspective, the sector's collective response to the pandemic has been something of a mishmash. With respect to day-to-day operations, we're seeing good content related to engaging our supporters, innovating in our programming, and staying the course. I can't say enough about the creativity and resilience of the sector and the people who work in it. And without their advice and knowledge, I know I would have been less effective over the last twelve months in mapping out my own organization's fundraising strategies.

That said, nearly everything I've read over the last year has been focused on practical problems and challenges, things like how to strengthen a pandemic case for support, when to schedule a Zoom meeting with a new prospect, and retaining your supporters after you've made the decision to move your next fundraising event online. Yes, it's important to develop and strengthen our practice in normal times, and even more so during times of uncertainty. But what I'm not seeing are stories about self-care during one of the most challenging periods in recent memory, stories that remind us that if we want to do our best work, we need to make sure we’re well enough to fire on all cylinders. "[J]ust as they tell you on airplanes when the oxygen masks come down,” says Chris Mosunic, chief clinical officer at Vida Health, "we can't help others if we don’t take care of ourselves first."

I’m a realist who knows that a big part of my role as a fundraiser is to deliver maximum net revenue for my organization. I also know that many of us worry about cultivating donor relationships and meeting ambitious goals, but that we are not always honest about how we ourselves are holding up. Sure, I've found a reasonable groove during the pandemic and I'm doing the best I can. But let's face it, the current fundraising environment is different than the one many of us are used to. And, truth be told, it's different for our donors as well.

A practical reason for self-care

You may not know this, but the work of fundraisers is never "done." Between programs, events, and annual reports, the effort to steward and engage donors and prospects is a year-round affair, and at times it can feel like we’re laboring on our own little island, disconnected from the day-to-day work of the organization and with no sign of help on the horizon.

From a purely practical perspective, this has an impact on our work. Leadership guru Kevin Krause suggests that "[e]ngaged employees lead to better business outcomes." And a survey of more than five hundred business leaders by the Harvard Business Review found that 71 percent "rank employee engagement as very important to achieving overall organizational success."

Also relevant in this context is what Virgin Group founder Richard Branson has to say about an employee-first mentality: "If the person who works at your company is 100 percent proud of the job they're doing…they're gonna be happy and therefore the customer will have a nice experience."

But how can we expect our donors and supporters to have a "nice experience" if those tasked with engaging them in the work of the organization are struggling?

Doing the work of self-care

The events of the past year are likely to resonate for years to come, and work will continue to be challenging for many frontline and back-end fundraising staff. But there are things we can do for ourselves, and our team members, that will result in a happier, healthier workplace.

First, be mindful of your time. For many, working from home has morphed into living at work. Don't be that person. Instead, set real start and finish times for your workday — and stick to them. It'll be easier to do that if you make the effort to wear work clothes during the work day. And because your day-to-day tasks aren’t going anywhere, unless there's an emergency, don't check your email before 9:00 a.m. or after 5:00 p.m. (Managers, you can help by refraining from the super early/late email messages.) In addition, try to create a schedule for your meals and stick to it. Limiting food consumption to mealtimes can be great for your well-being, and equally beneficial to your waistline.

Second, be mindful of technology. These days, our big, medium, and little screens are where we spend a big chunk of our time. Indeed, Americans spend an average of 2.3 hours a day on social media — the equivalent of roughly thirty-one days a year. To combat screen-induced burnout, try to establish "no glow breaks" throughout the day — on a run, in the bathroom, while out doing errands — where you put the technology in your life on pause. Also, make an effort to incorporate some analog technology like paper into your life. For what it’s worth, Scientific American suggests that our screens "[p]revent people from navigating long texts in an intuitive and satisfying way. In turn, such navigational difficulties may subtly inhibit reading comprehension."

Finally, be mindful of your state of mind. One in six Americans sought counseling in 2020, joining the one-third of Americans who were already receiving some kind of counseling. Perhaps more than at any other time in recent history, we are willing to acknowledge the need for self-care. For those who are feeling stressed, reducing some of the distractions in your life, like  notifications on your phone/tablet, will go a long way to calming an overly busy mind. Similarly, when lodged in your home "spaceship," try to organize your space into discrete areas — a corner of one room for exercise, a certain chair for reading or chatting on the phone — and don’t use your sleep space for other tasks like work or social media.

The last year has been difficult for many. If you find yourself struggling with something more serious than time management or the distractions that come with being plugged in all the time, give yourself permission to talk to a professional or, at the least, a friend. And remember, you may have challenges; but you are not your challenges.

Our colleagues and donors rely on us, but more than anything we are responsible for ourselves.With that in mind, don’t be afraid to take the leading role in your own self-care.

(Photo credit: David Lusvardi via Unsplash)

Evan_Wildstein_PhilanTopicEvan Wildstein has served on the fundraising team at the Kinder Institute for Urban Research at Rice University since 2017.

5 Questions for...Frances Sykes, President and CEO, Pascale Sykes Foundation

April 27, 2021

For much of its existence, the New Jersey-based Pascale Sykes Foundation has worked to strengthen low-income working families in the New Jersey/New York region through what it calls the Whole Family Approach, a preventive (as opposed to crisis-driven) strategy that helps family members, both adults and children, support one another in achieving their long-term goals. With the understanding that financial stability, healthy relationships, and physical well-being are linked, families are matched with a coach who works alongside family members to identify and set their goals; ensure they have the resources and tools needed to achieve those goals; and connect them to a network of agencies able to deliver holistic, coordinated support. The approach has been applied in various settings and with immigrant families, foster youth, and families dealing with members who are re-entering society from the criminal justice system.

The foundation's work extends into other areas as well. After rural families in southern New Jersey identified transportation as a major challenge, the foundation supported an initiative known as Transportation Plus, which provides residents of the region with connections to NJ Transit. And through its Economic Initiative, a partnership with a community development financial institution, the foundation invests in a series of low-interest loan funds for small businesses and nonprofits in the region.

Frances P. Sykes has led the foundation since its founding in 1992. In 1995, Pascale Sykes trustees voted to sunset the foundation by 2022. PND spoke with Sykes about the foundation's Whole Family Approach, where things stand with the spend-down process, and her hopes for the field.

Headshot_frances_sykesPhilanthropy News Digest: You've said you created the Pascale Sykes Foundation with two intentions: to serve working low-income families that aren't eligible for many safety-net services, and to help reshape the way social services in the United States are delivered. How did you come to settle on those two objectives?

Frances Sykes: When I was teaching, I witnessed a working family struggle to get help for their eleven-year-old, who was in danger of going down the wrong path. The family made too much to qualify for free supportive services, and under a sliding scale they would have been asked to pay more than they could afford. They were stuck, whereas a middle-class family in the same situation more than likely would've been able to afford to pay out of pocket for counseling and other services for their child. It wasn't fair that the issue the child was experiencing wasn't severe enough, or that the family wasn't poor enough, to allow them to access the resources they needed. Far too many families are in that same position — living one step above the poverty line and lacking access to the kinds of support they need. I wanted my work to be a part of the solution to that challenge — to help build a bridge between what families need and the agencies that have the resources to empower them.

The Whole Family Approach evolved over ten years. By working alongside grantees, Pascale Sykes trustees, staff, and grantees could see what made a lasting difference in families' long-term well-being. And we also came to realize that families know what they want and are capable of achieving it if they are taught how to navigate the system. It's not complicated. Adults in charge. Financial stability, relationships, and physical/social/emotional health reinforcing each other. What happens to one person affects the entire family, and what happens to the family affects each individual within it. Root causes must be addressed or problems recur.

The approach turns traditional social work on its head. In our approach, social workers are no longer expected to fix problems or work with individuals in isolation or address isolated issues. Instead, coaches work to build trust and walk alongside every member of the family as they work to achieve their self-defined goals.

PND: A critical component of the Whole Family Approach is the requirement that two "dependable adult caregivers are actively engaged with the children in the family." Why is it important that two adults be involved?

FS: All families look different. But every adult needs someone to call or turn to in an emergency, or just to share good news with. The second adult not only supports the primary caregiver but is an additional support system for children in the family as well. And that's a win-win for everyone. The stronger the support system, the healthier the family and the more likely its members will reach their shared goals.

PND: A July 2020 report that examined the results achieved by eight collaboratives using the Whole Family Approach found that participating families were in a better position to handle the impacts of the COVID-19 crisis because of the stronger familial ties they had forged and the access they had to support networks, even though they still experienced anxiety and mental health issues in addition to the stressors they were facing pre-pandemic. Are you seeing any evidence that the field in general is shifting toward this type of strategy? And looking down the road five to ten years, where do you see challenges to more widespread adoption of the approach?

FS: The field has been shifting for a few years. You see variations of the Whole Family Approach promoted by larger funders like Kellogg, the Annie E. Casey Foundation, and other high-profile organizations under names like "2Gen" or "Intergenerational Approach."

I really see no challenges to its adoption by others in the field — even if others give it another name and make it their own. It's a proven approach that we know works better for families. Our research has shown that adults have less financial stress, that ties between adults in a family are strengthened, that children's health and educational achievement improve, and that the academic aspirations of both adults and children are raised. In the time remaining before we officially sunset later this year, the foundation is on a mission to raise awareness of the approach and to get others to embrace it. We believe it can advance the field and put more of our working families on a path to stability.

PND: The foundation's approach emphasizes collaboration — among family members, nonprofits, and human services agencies, and between the foundation and its partners. In a 2019 post for our blog, you urged funders to shift their grantmaking so as to foster more collaboration and less competition among grantees. What are your thoughts about the state of collaboration in the social sector today?

FS: The competition for limited resources has resulted in a fragmented approach to service provision that undermines the value of those services for families in need. Too often, families are forced to start from scratch in their efforts to access services, filling out the same form multiple times for multiple agencies, then receiving a separate set of recommendations from each of those agencies. What's more, different agencies often will offer differing and/or conflicting advice. Families become overwhelmed. Parents become frustrated, unable to prioritize and plan their next steps. Children feel the lack of stability and bear the brunt of its effects. It's also difficult for busy family members to build solid, trusting relationships with representatives from multiple agencies.

We believe collaboration is key. That's what the Whole Family Approach is all about. To maximize their effectiveness, funders, nonprofits, and agencies that have bought into the approach capture and share information about their clients' goals, progress, and life changes in a centralized database, enabling partner agencies to see families as holistic entities with their own unique challenges, vulnerabilities, and strengths. Instead of operating individually, agencies begin to see other nonprofits in the collaboration not as competitors but as teammates they can lean on to organize priorities, share resources, and advance their mutual goals and objectives.

The more foundations see the benefits of the Whole Family Approach, the greater the chances we'll be able to change the system so that it is more efficient and effective in helping families thrive.

PND: In 1996, your board voted to sunset the foundation within thirty years, and in 2009 a non-trustee workgroup researched and set up plans for the spend-down process. How much of an impact has your status as a limited-life foundation had on your grantmaking strategies? And would you recommend the approach to others who may be thinking about establishing a private foundation?

FS: Being a limited-life foundation is necessary for any small foundation that wants to create real change. Change requires the flexibility to respond to unexpected situations. This can only happen if a funder is focused on making change, not preserving the corpus.

The decision to sunset was based on two key factors. First, the decision to make a large impact was critical, and distributing 5 percent to 6 percent of our investment income each year simply would not accomplish that goal. And second, when we started, the Whole Family Approach was not well known. Thirty years later, we're proud of the fact that more foundations and organizations are implementing a version of the approach, and that it is leading to greater impact. I have no doubt the approach will be accepted more broadly. And when it is, instead of shifting into a new focus area or something less relevant to us, we'll be able to say we accomplished our mission.

We look forward to more funders picking up the mantle and moving this work forward in their own way. And I highly recommend our grantmaking strategy and the Whole Family Approach as a way forward for others who want to make a big impact in a particular way.

Kyoko Uchida

The next Silicon Valley must-have? A private foundation

April 23, 2021

Layton-diament_yachts_unsplashWhile the pandemic may have shuttered businesses across the country, Silicon Valley tech companies have defied the odds. In 2020, IPO capital raising hit its highest level in a decade. Start-up valuations soared, and blockbuster IPOs, like the one for Airbnb, created a bumper crop of wealth. But unlike previous iterations of newly minted money, the beneficiaries of this recent boom are forsaking the traditional private-island-and-jet splurge. Their new acquisition of choice could be a more charitable one.

Last year my company, Foundation Source, helped set up more new foundations than at any other time in our twenty-year history — many for tech entrepreneurs and business owners planning for a liquidity event. And we expect that the ongoing wave of IPOs could fuel a surge in private foundation philanthropy, even as Brookings, NPR, and others have documented a decline in spending among America's most affluent households during the past year.

What, no gold-plated yacht?!

Boom times in Silicon Valley used to be marked by lavish displays of excess, including the now-legendary wedding of Napster co-founder Sean Parker, whose 2013 "Lord of the Rings" nuptials cost $4.5 million and featured a nine-foot-tall cake and guest apparel by the film's costume designer. So, why aren't the beneficiaries of the current boom acquiring sharks with laser beams and other accessories for their Bond-villainesque subterranean lairs?

One possibility is that economic uncertainty has put a damper on lavish displays of conspicuous consumption. As recently reported in the Wall Street Journal, the so-called "smart money" is bearish on companies that have gone public through special purpose acquisition vehicles (SPACs). Short-sellers have increased their bets to more than triple their value at the start of the year, rising from $724 million to about $2.7 billion. And broadly speaking, no one is sure whether the post-COVID economy will be characterized by unprecedented growth or inflation and sluggish employment rates.

Other factors, however, may be inspiring Silicon Valley's latest crop of multi-millionaires to seek gratification in philanthropy instead of consumerism:

Heightened awareness of increased need: While the gulf between America's haves and have-nots has been widening for decades, the gap grew even wider during the pandemic. The weight of the public health crisis fell unequally on the vulnerable, with millions of Americans unable to afford or access essentials such as food, health care, housing, and broadband. Against a backdrop of seemingly endless lines at food pantries — even on military bases — extravagant displays of wealth may seem insensitive as well as immoderate.

An attitude of gratitude: Aaron Rubin, a partner at Werba Rubin Papier Wealth Management, told the New York Times that this boom feels qualitatively different from previous ones. In addition to experiencing unease about the economy, his clients are expressing "more gratitude" and making more plans for charity.

Social crisis: COVID wasn't the only emergency in 2020. Racial equity, social justice, and our polarized political environment — all featured prominently in our national conversation over the course of the year and caused many people to think more seriously about how they could use their assets to influence society positively.

Generational generosity: Many Silicon Valley "techies" are millennials. Fidelity Charitable's Entrepreneurs as Philanthropists survey shows that in comparison to other generations, millennials are relatively more philanthropic, more concerned about using their social capital and purchasing power to improve the world, and more interested in aligning their actions with their ideals. And they've been very responsive to the increased need as of late.

In addition, nearly three-quarters of millennials have sent financial aid to family or friends or donated to a nonprofit since the pandemic began, according to payment app Zelle's September Consumer Payment Behaviors report. That's the highest rate among any of the generational cohorts polled.

The Tesla of charitable vehicles

It's easy to see how the next wave of IPOs could fuel an explosion of interest in philanthropy; what's less clear is how that interest will manifest itself. Although Silicon Valley has a very robust community foundation that serves the surrounding region, not all of the millennial philanthropists in the valley are likely to be content with limiting themselves to meeting local needs. Nor are they likely to be satisfied with giving only through donor-advised funds (DAFs), which, while popular for their tax advantages and easy set-up, do not offer donors much say over their giving.

Consider these critical insights into how millennials approach their giving, as noted in the Fidelity Charitable survey:

  • While they are more likely than other generations to see giving as part of their identity, millennials also may have lower levels of trust in the nonprofits they support and may be more likely to want to be actively engaged in the direction and use of their financial support.
  • Millennial entrepreneurs see charitable giving as a way to build their reputation, with 84 percent saying they value giving as an opportunity to demonstrate leadership in the community.
  • Seventy-four percent of millennial entrepreneurs value having their contributions recognized publicly, compared with only 19 percent of boomers.
  • Millennial business owners are already planning their charitable legacies; nearly two-thirds plan to leave money to charity after they're gone, versus 46 percent of boomers.

The same study also notes that "[y]ounger entrepreneurs are going beyond simple cash donations — both personally and in their businesses — and are giving in increasingly sophisticated ways."

For all these reasons, a private foundation, which confers complete donor control and offers an almost limitless toolbox for creative giving, might emerge as the preferred charitable vehicle for this new cohort of donors, one that values hands-on, outside-the-box philanthropy. In addition to making grants to publicly supported nonprofits, the type of giving permitted by a donor-advised fund, private foundations are empowered to:

  • Give directly to individuals in need.
  • Make loans to charitable organizations and use the proceeds from the repayments to make other programmatic investments.
  • Invest in for-profit businesses to further a charitable purpose.
  • Conduct their own charitable programs and activities.
  • Give awards and prizes to catalyze progress on an issue.
  • Enter into binding agreements with grant recipients to ensure they use the funds as intended.
  • Dictate naming rights as part of a grant agreement and enforce adherence.
  • Deliver grant checks in person (e.g., at a fundraising gala).
  • Follow any investment strategy that complies with prudent investor rules.

Moreover, because a private foundation can be established to exist in perpetuity, handed down from one generation to the next, it might have a special appeal for techies who are intent on building an enduring personal legacy associated with lifelong philanthropy and social impact.

For some great examples of charitable giving made through private foundations, check out the Foundation Source website.

(Photo credit: Layton Diament via Unsplash)

Hannah Grove_Foundation_Source_philantopicHannah Shaw Grove is the chief marketing officer at Foundation Source, the nation's largest provider of support services to private foundations.

11 questions you should always ask a recruiter

April 06, 2021

Ask a recruiterRather than ignoring the next email or call you get from a recruiter, think of it as a learning opportunity — even if you aren’t seriously considering leaving your current position. In most cases, the experience will help you learn about yourself as a job prospect and give you a sense of what employers are looking for — insights that can be invaluable when it is time to make a move.

Time and again, I've seen job candidates who weren’t even beginning to think about a  career move completely change their perspective — and strategy — when presented with a compelling opportunity.

So, if you are contacted by a recruiter, consider asking the following:

Why is the position open? Find out whether it's a newly-created role or an existing position that has become vacant. If the latter, ask why the person who occupied the position previously left and how long the position has been open.

What are the skills and experiences the hiring manager is prioritizing? Ask the recruiter to list the desired skills and experiences for the position. Having such a list will make it a lot easier for you to compare the employer’s requirements to your own skillset and decide whether it is worth pursuing the opportunity.

What does the day-to-day of the job look like? Asking this is a great way to get beyond the boilerplate of a job description and to really start to understand what the role entails. Is it a meeting-heavy position? Does it require research and/or writing? How much? How closely supervised is the position? Ask questions that will help you understand how you would be spending most of your time.

What can you tell me about the person to whom I would report? Research shows that the biggest reason people leave their jobs is their manager, not the work itself. Your manager is critical to your success and level of satisfaction. Ask the recruiter to tell you what the person who will be managing you is like, what she values, and how she prefers to operate.

Why did you reach out to me? What in my background suggests I'd be a good fit for the position? The answer to this question can help you understand how people outside your organization view your work and accomplishments, as well as how diligently the recruiter did her homework, which might also be an indication of how well they understand the position they've been hired to fill.

Is there anything in my resume or background that could be a concern? This is a great way to get a sense of how competitive you are for the role, and it will also provide information you can use to map out a strategy for addressing any perceived gaps in your cover letter, resume, and during the interview process.

What is the compensation range for the position? Asking about compensation up front shouldn't impact your candidacy in any way. Indeed, the recruiter should be ready for this question and have no qualms about sharing a range. And remember, in many states it's illegal to ask a candidate for a job what her current salary is, so don’t feel you have to share it if asked.

What kind of flexible work arrangements does the job offer? This is especially important information in the era of COVID, when many people have gotten used to working from home and may want to continue to do so. Understanding the range of benefits that come with position more generally is also a good way to learn about the organization’s culture and values.

Tell me about the organization's culture? What are its values and how do they show up in the organization's work? For most people, organizational culture and values are critical factors in deciding whether to accept a position at a new organization. Ask the recruiter to provide details that go beyond what's on the organization's website or in a handbook and show how its values actually manifest themselves in its day-to-day activities. Ask, too, about professional development opportunities, its human resources practices, and all the other things that go into creating a vibrant organizational culture.

What work has the organization done to become more diverse, inclusive, and equitable? This is deeply important in 2021 to candidates who are seeking workplaces that are inclusive and equitable. Feel free to ask about the diversity of the staff, senior leadership team, and board of directors. Ask about diversity and equity-focused trainings and development opportunities. And don't be hesitant to ask how the organization has responded to external events that have put a spotlight on racial injustice and equity.

What are the steps in and timeline for the interview process? The answer to this question should give you a sense of how much of a time commitment you’ll be asked to make if you want to pursue the opportunity, and whether it is something that’s worth the investment of your time and energy.

The questions above are meant to be a starting point for determining whether a potential role may be a good fit and deciding whether you want to pursue an opportunity that a recruiter puts in front of you. Be creative and come up with some of your own. Moving to a new organization can be scary, but it's also a great way — maybe the best way — to advance your career. Gather as much information as you can before making a decision and act accordingly.

Headshot_moly_brennanMolly Brennan is founding partner at executive search firm Koya Partners, which is part of the Diversified Search Group, where she is also the nonprofit practice lead. A frequent contributor to Philanthropy News Digest and other publications, Brennan also authored The Governance Gap: Examining Diversity and Equity on Nonprofit Boards of Directors.

Supporting the South's small businesses is supporting an equitable recovery

March 26, 2021

Closed_due_to_coronavirus_sign_GettyImagesLike the rest of the nation, small businesses across the South have faced unprecedented challenges since the beginning of the COVID-19 pandemic. Millions of them saw demand drop and had to close their doors as their reserves were depleted. The breadth of the impact has been staggering — from industries like travel, food service and hospitality, to dentists, artists, mechanics, and farmers.

While federal relief efforts have been helpful for some, they have been insufficient or inaccessible for many, especially women, people of color, immigrants, and other underbanked populations. To address the gap, a number of philanthropic programs have been launched in states across the country to help small businesses at the back of the line — or not in the line at all.

The South has long suffered from a lack of philanthropic and institutional investment, a trend that has continued through the pandemic. The region benefits from only 56 cents of giving for every dollar granted in other regions. And for every dollar given to address structural change in the rest of the country, just 30 cents goes toward these issues in the South, despite well documented challenges with economic mobility, particularly in communities of color. This lack of investment could mean a slower, more difficult recovery and a deepening of those structural issues in the region.

Now is the time to change that trajectory, and supporting small businesses, including small-scale farmers and critical community organizations, is a place to start. Small businesses create jobs, drive economic vitality in communities, and have a tremendous impact on the well-being of families: entrepreneurship is second only to home ownership as an effective means of building family wealth. Plus, we know that small businesses tend to provide higher-quality jobs and are active participants in their communities.

Given adequate resources to navigate and rebuild from the pandemic, these resilient, creative, and resourceful entrepreneurs can overcome the immense hardships they are facing; in fact, many are already showing their resolve to do so. For countless small business owners, there has been no other option.

Unfortunately, even pre-pandemic, many of these businesses lacked access to affordable credit. NextStreet estimates that the credit needs of un- or underbanked small businesses exceeds $80 billion — and that was before banks pulled back because of the economic uncertainties created by COVID-19. We saw bank lending decline 16 percent during the Great Recession; given the recent trends of bank consolidation and the loss of many community banks, we expect the pandemic-driven decline to be even steeper in low-income, rural, and already underresourced communities across the country.

Luckily, we know — and have seen throughout COVID — that nonprofit community-based lenders certified as community development financial institutions (CDFIs) take the opposite approach. In times of crisis, they lean in. CDFI lending increased during the Great Recession, with many CDFIs doing five to ten times more lending in 2020 than in previous years to support the immediate needs of the small businesses and community-based organizations operating within their footprint.

That is why we are building and supporting the Southern Opportunity and Resilience (SOAR) Fund alongside thirteen CDFIs across the South. The program was designed to support the needs of local community lenders so they have access to low-cost capital, a technical assistance ecosystem, and a centralized technology platform that helps them find small businesses, including small-scale farmers, and nonprofits who need their help.

The economic recovery from the impact of COVID-19 is going to be long, and support for small businesses will be needed well beyond the administration of vaccines. If we want the post-pandemic recovery to be more equitable than the last one — and be focused on the potential and opportunity in local economies across the South — we need solutions structured to support the scaling of organizations that have been built in and served these communities for decades.

If we want to create asset- and wealth-building opportunities while maintaining the critical cultural fabric of our communities, philanthropists need to come together to support CDFIs and the small businesses they were built to serve.

(Photo credit: GettyImages)

Beth Bafford_Jennifer_Gadberry_philantopic - CopyBeth Bafford is vice president of syndications and strategy at Calvert Impact Capital, which is acting as the arranger for the SOAR Fund. Jennifer Gadberry is vice president of asset management at Heifer Foundation, an investor in the SOAR Fund.

Empathetic leadership during the storm

March 17, 2021

Texas storm capture"Lead with an iron fist," said some.

"Never let them see you cry," others recommended.

"You were born to lead," many affirmed.

Countless people have offered advice and encouragement to me as a leader over the years. Yet the idea of empathy in leadership has rarely been addressed.

As a Black female nonprofit executive in Texas who earlier this winter found herself in a vulnerable moment, I feel compelled to record some of my struggles. First there was the pandemic, followed by the killing of George Floyd and heightened racial tensions, and then — boom! — a winter storm with near-zero temperatures that collapsed the state's power grid and left millions of Texans in dark, unheated homes. Even as it was happening, I knew it was going to be bad, and most likely deadly.

My first instinct was to reach out to my staff and inquire about their housing, food, and other needs. In my experience, employers in times of crisis rarely do wellness checks on their employees (other than to inquire whether the employee will be coming into work or not). While nonprofits are quick to respond to community needs during a disaster, how many organizations offer direct support to their own staff? As an empathetic leader, I was concerned first and foremost that those closest to me were safe and out of harm's way.

During the deep freeze, I considered my teams' mental health and reminded them of our EAP program and insurance plans that could assist with counseling. With a team comprised largely of women of color, I understood how responses to crisis and trauma live in our bodies. But in my role as executive director of Faith in Texas, I also knew I had to consider all the harms suffered by the communities my organization serves.

Where did that leave me? Self-care seems to be the rage these days, but it's much easier said than done. Infuriated by the lack of accountability on the part of Texas officials, ERCOT, and electric companies serving the state, I decided to take a break from the news. But within an hour, an employee texted me asking if we could help dozens of families that had been locked out of their hotel rooms and had nowhere to go.

It was then that the magnitude of the crisis became apparent. This wasn't a time for self-care. As a single mother, my heart ached for the displaced mothers and their children. I imagined them trying to survive the freezing cold, dealing with harsh conditions as they scrambled to find public transportation to the suburbs, where mutual aid groups could secure them rooms. I imgained them trying to find food to eat, water to drink, hygiene products, even underwear for themselves and their kids.

It was more or less the same thing the employee who texted me was experiencing. A Black woman and mother of small children, she, too, was scrambling to find temporary housing. And yet she was advocating for others in crisis; self-care would have to wait.

In the days that followed, family and business colleagues from around the country reached out to check on me and my sons. And my answer to their first question was always, "I'm fine. Grateful to be safe, warm and healthy." But I was numb.

Through my contacts, I began to hear about helpers on the front lines — heroic individuals, small nonprofits, and local Black churches that were doing crucial, in-the-moment work to help people survive. I knew their names wouldn't be mentioned during funder calls. And while local and national media outlets were making an efort to highlight the work they were doing and individuals around the country were responding to calls for donations, I realized I had a responsibility to elevate all the organizations and people who were selflessly neglecting their own self-care to provide critical services. Truth be told, I wasn't sure if every organization had 501(c)(3) status, but that hardly seemed to matter. They needed — and deserved — all the resources they coud get. And they deserved to be trusted to use the money — not just in-kind donations —  in an effective manner. Standing up for grassroots organizations is another role I embrace.

Leading with empathy probably isn't the best long-term strategy for a Black female nonprofit executive looking to impress large funders and donors, but, inspired by John Hope Bryant's Love Leadership, it's the legacy I prefer to leave. Like Bryant, I recognize that there can be no strength without suffering, no power without vulnerability. As Black women calling for equity and healing, my sisters and I speak out of love and respect, from a history of suffering, and mindful of our own vulnerability. All we ask is that you give us an opportunity to show our greatness.

(Photo credit: Mario Cantu/Cal Sport Meia via AP Images)

Headshot_Akilah Wallace_cropAkilah S. Wallace is executive director of Faith in Texas. This article originally appeared in the Opinions section of  Women of Color in Fundraising and Philanthropy.

To save lives, fund syringes

March 15, 2021

SyringesWhen COVID-19 struck, the United States was already facing a number of public health crises, with national rates of overdose, HIV, and viral hepatitis rising due to increases in substance use linked with a surge in prescription opioids.

The pandemic has converged with these crises, worsening health outcomes for people who use drugs — a crisis that is likely to persist unless we change our approach to drug use.

Take overdose deaths, which increased some 20 percent in the United States between June 2019 and June 2020, to more than 81,000, according to the Centers for Disease Control and Prevention. That's the most fatal overdoses ever recorded in a single year.

And while national figures for new HIV and viral hepatitis cases are not yet available, it's likely they are growing, too, given reported spikes in injection-drug use. (Both diseases can be transmitted via the sharing of injection supplies.) From 2014 to 2018, HIV diagnoses increased 9 percent among Americans who use drugs overall, while some 2.4 million Americans had been diagnosed with hepatitis C as of 2016.

Such grim statistics underscore the need for the U.S. to adopt evidence-based drug policies that can save lives and improve outcomes for people who use drugs. The willingness of the Biden administration to think differently about national drug policy and the changing views of Americans present a critical opportunity to do that.

For decades, policy makers and medical professionals have addressed substance use in two main ways: demand reduction and supply reduction. Both approaches treat substance use as an immoral behavior to be eschewed, instead of as a personal response to social factors or difficult life circumstances.

Neither strategy has significantly reduced substance use or its associated harms. Even though drug arrests jumped 171 percent between 1980 and 2016, the price of most illicit drugs fell, while attempts to dismantle the international drug trade have resulted in extreme violence.

Indeed, America's War on Drugs has tyrannized countless numbers of Black and brown families with racialized policies like mandatory minimum sentencing guidelines. Such policies have resulted in the overcriminalization of minor drug offenses, the mass incarceration of Black and brown people, and fractured communities across the nation.

Meanwhile, Americans are still using drugs.

It is long past time for the U.S. to embrace the principle of harm reduction, which has proven to lower rates of substance use around the world. Harm reduction recognizes the humanity of people who use drugs, acknowledging that people's relationships with substances usually change over time, and aims to minimize the negative consequences of substance use by fostering the inclusion of those who use drugs in an ecosystem of interventions and services.

The most effective harm-reduction interventions are syringe-services programs (SSPs), which were introduced in the 1980s and '90s as a community-based response to injection-drug use amid the HIV/AIDS epidemic.

Today, they provide syringes, overdose-prevention education, syringe-litter cleanup, infectious-disease testing, and — crucially — naloxone, the lifesaving overdose antidote. SSPs also connect their clients to treatment for substance-use disorder, as well as primary care and social services.

Despite this vital work, U.S. laws have long constrained service providers. In 1988, bipartisan opponents of syringe services prohibited providers from receiving federal funds until the government determined they were safe and effective. The ban remains partially in effect, even as reams of research have shown the benefits of syringe services, from reducing emergency medical costs to lowering rates of HIV and hepatitis C. SSPs still cannot use federal funds to purchase syringes, which help prevent infectious disease among people who inject drugs.

Since the COVID-19 pandemic began, I've seen a dramatic spike in people receiving syringe services through my work managing AIDS United's Syringe Access Fund, which disburses about $1 million in philanthropic funds to SSPs annually. And it is happening at a time when public and private funding for harm-reduction services was already inadequate.

Although Congress has allocated billions of dollars to combat the opioid crisis, many of those programs stop short of addressing the complex health, psychosocial, and socioeconomic factors underlying chronic substance use. For instance, half of all State Opioid Response (SOR) grants — a major federal initiative designed to help states expand their opioid addiction treatment services over the course of two years — went unspent, a federal watchdog has found, by the time the program was wound down. At the same time, our Syringe Access Fund grantees are struggling to meet their clients' needs and pay their bills. This not only imperils lives and public health but strains local resources.

It is time Americans recognize that the best way to reduce the staggering number of lives lost to overdose each year is to invest in services that support people while they are using drugs. To do that, we need to reach people who use drugs where they are. Syringe services programs are a cost-effective way to serve communities that many see as hard to reach, but which actually are hardly reached, as well as an opportunity to invest in a more holistic and inclusive public health infrastructure.

Without greater investment in that infrastructure, hundreds of thousands of Americans are likely to slip through the cracks and die from overdose in the years to come. We have the tools to prevent these deaths, so long as we invest in the lives of people who use drugs.

Zachary_Ford_AIDS_United_philantopicZachary Ford is a senior program manager at AIDS United, where he oversees the Syringe Access Fund, a grantmaking initiative focused on improving health outcomes for people who use drugs.

What COVID-19 has taught us about investing in public health

March 12, 2021

2020_May_Ho Chi Minh City_screening_Operation_SmileCOVID-19 continues to pose novel challenges to health systems around the world. With the rapid depletion of stockpiles of personal protective equipment (PPE) and severe shortages of physical space in which to care for those affected by this perplexing and terrible disease, even well-resourced surgical health systems have been pushed to the brink of their capacity.

But in many low- and middle-income countries, the virus that emerged in late 2019 has exacerbated a problem that remains anything but novel in 2021. In places that lack the infrastructure, funding, and healthcare workforce able to cope with the pre-pandemic needs of its citizens, COVID-19 has further limited the ability of public health systems to provide essential surgical care to people who need it.

A study published in the British Journal of Surgery estimates that over a twelve-week period during the initial surge of COVID cases last spring, hospitals in low- and middle-income countries were forced to cancel more than 15.5 million surgical procedures as they prioritized patients infected with the virus. The ripple effect caused by these cancellations has had costly consequences in terms of avoidable human suffering. People who need surgery for trauma, cancer, burns, or congenital conditions such as cleft lip and cleft palate have been forced to wait and grapple with the debilitating effects of their conditions. Lives have been lost.

On a personal level, the coronavirus pandemic has brought back memories of my experience in Liberia leading Africare's response to the 2014-15 Ebola epidemic. During that emergency, all essential and emergency public health services were suspended as the healthcare system struggled to respond to the surge in Ebola cases. As a result of insufficient investment over many years, the country was ill prepared to address the highly infectious nature of the disease, and its response was further weakened by the dearth of critical medical equipment, testing and diagnostic capabilities, healthcare workers with the training needed to respond to the disease, and adequate PPE.

We see many of the same factors at work today, with predictable results, including an erosion of trust and confidence in health workers' capacity to provide adequate care and in patients' ability to receive care without risking their lives. As reported in a Journal of Public Health paper, patients in need of surgery are not seeking care for fear of contracting COVID while in hospital or a clinic. And this is in addition to preexisting structural, financial, and socioeconomic barriers that prevent tens of millions of people from accessing safe surgery.

We must and can do better.

If we are to care for the countless number of people in need of surgery while remaining responsive and resilient when faced with outbreaks of diseases such as COVID-19, the global health and international development communities must step up their capacity-building investments in both surgical ecosystems and public health systems.

Early on in the pandemic, Operation Smile made the difficult decision to put all its medical programs on pause. We knew hospitals and frontline health workers would soon be overwhelmed by an influx of desperately sick patients and that we needed to protect the people who turn to us for help, their families, and our staff and volunteers by suspending international travel indefinitely.

These measures resulted in surgery and dental care being delayed for thousands of Operation Smile patients. At the same time, we decided to increase our investment in public health systems in the countries where we work, both in response to the virus and to improve the quality of locally available care after the pandemic was over. To that end, we leveraged our longstanding relationships with various ministries of health and NGO partners to procure and donate PPE, respiratory equipment, COVID-19 test kits, and food and hygiene supplies to hospitals and communities hard hit by the virus.

What has been especially impressive about the global surgery community's response to COVID-19, however, has been its unity. Despite all the challenges posed by international travel restrictions, NGOs have turned to one another for help in overcoming their logistics and implementation hurdles. We experienced this firsthand in our work with organizations like the World Children Initiative, African Medical and Research Foundation, Kids Operating Room, Lifebox, and Medical Aid International, all of which have been instrumental in helping us procure and distribute PPE and medical supplies and equipment across Africa.

And the response extends beyond physical donations. Academic institutions, surgical societies, NGOs, and corporations have also come together to provide virtual training and education opportunities to frontline healthcare providers in resource-constrained settings. Operation Smile today partners with the United Nations Institute for Training and Research, the College of Surgeons of East Central and Southern Africa, and ministries of health in a number of countries to help thousands of health workers upgrade their skills and address the unique challenges they face.

At the end of the day, investments in public health systems help build confidence among patients, who can see that they will receive care that is safe and effective, as well as health workers, who are empowered with the knowledge, supplies, and skills they need to deliver relevant care safely and in a timely fashion. Indeed, World Health Organization chief Tedros Adhanom Ghebreyesus recently affirmed that the time for such investments is now: "Public health is more than medicine and science and it is bigger than any individual and there is hope that if we invest in health systems…we can bring this virus under control and go forward together to tackle other challenges of our times."

In the same essay, however, Tedros warned that the response to COVID-19 is not enough to "address the global under-investment in essential public health functions and resilient health systems, nor the urgent need for a 'One Health' approach that encompasses the health of humans, animals, and the planet we share. There is no vaccine for poverty, hunger, climate change or inequality."

At Operation Smile, we've learned that the time is always right to invest in systems with the aim of making them more resilient and responsive to the needs of the people they are intended to serve. But only a global response will yield the kind of impact we desperately need to stop COVID in its tracks and end the pandemic.

As the old saying goes, "to whom much is given much is required." Today, more than ever, global health stakeholders and international development actors must step up and provide the financial and human capital needed to build public health systems that can respond to emerging health needs efficiently and effectively. There's a not a moment to waste.

(Photo credit: Operation Smile)

Ernest Gaie_operation_smile_philantopicErnest Gaie serves as senior advisor for global business operations at Operation Smile.

Quote of the Week

  • "[L]et me assert my firm belief that the only thing we have to fear is...fear itself — nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance...."


    — Franklin D. Roosevelt, 32nd president of the United States

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