15 Aug 24
Of the $335 Billion dollars given last year in America, around ten cents (10) of each dollar given by check or wire transfer was written by a Foundation. The Wall Street Journal had an interesting article on Monday 14 April, 2014. The Article titled “Family Foundations Adopt New Mantra: Let’s Spend It All” by Veronica Dagher. A narrative about Family Foundations in America. 24% of those family foundations intend to give all of their assets away during the lifetime of the existing directors.
Why? Inquiring minds want to know. Cassidy Burns a Minneapolis based Financial Advisor recalls how a very wealthy family whom she worked with struggles to find a successor to lead the family foundation. Their adult children have successful careers, and were raising families in different parts of the country and simply weren’t interested in the same cause their parents were passionate about. That unwillingness to take over the family foundation eventually forced the parents about a year ago to make a difficult decision: Start spending down the family foundation while they are still alive.
More Philanthropists and Stewards are choosing to donate all their foundation’s assets within their lifetimes. About 50 years ago only 5% of the total assets of America’s largest 50 foundations were held by spend-downs. In 2010 that number had risen to 24% according to Bridgespan Group in Boston.
DOIN’ MY GIVIN’…WHILE I’M A LIVIN’
“So I’m a knowin’ where it’s goin’!” In my nearly 34 years of helping organizations with their annual, capital and endowment funding needs I have heard that statement many times. Based upon this research it’s a term we are going to hear more often. We all know it, donors vote with their checkbooks! These Family Foundations are the same; they are going to fund projects that are near and dear to their hearts or ones that can become that way.
These Foundations may not have a clearly stated goal or in fact a time line, but keep in mind, foundations with limited duration may be more risk averse. This may discourage them from funding more complicated causes that may take longer to bear fruit. Keep it simple in your communication and request with these spend-down foundations. Invite them to consider funding the Three P’s-ask them to help with Programs, Personnel and Property. Show them some immediate or near immediate impacts on your organization. We want you to see results while you are still living! Annual or Capital, I would not recommend Endowment unless there is a very unique opportunity with the foundation. How do we get in line or perhaps even to the front of the line? Once again our experience and recommendations haven’t changed much in the past 34 years!
PAT’S 4 C’S
“See the People; See the People, See the People and See What God will do with this Transformational Relationship!” These family foundations do not give to proposals…nope, they give to people! So don’t send them a proposal, go see them live and in person. Ask questions, share your mission, vision and core values and invite them to share theirs. 24 is not just a favorite TV program, it’s also a call to get out in the field with foundations and share your impact on the community, our nation and the world!