navigating trends in family philanthropy

10/2/2017, 9:30amNavigating Trends in Family Philanthropy

Tony Macklin

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Oct. 2, 2017

Tony Macklin, CAP®

@familygiving#NCFPCF@CF_Conference

Copyright © 2017. A portion of this material is excerpted from NCFP publications and research reports. These slides should not be copied or distributed without prior permission of NCFP.

I. Macro Trends

II. Case Study

III.Building Resilience


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Connection to family members, family legacy

Philanthropic giving and/or social impact


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Generational mobilityIncome, asset, race gapsPolitical polarizationOpting outSuspicion of endowed wealth

80% of older foundations (pre-1970) have a geographic-based mission

60% of newer foundations (post-1990) have an issue-based mission

33% of all family foundations have both


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Informed Americans who don’t trust nonprofits to “do what is right”

General public less trusting

Getting worse

In which sectors do wealthy individuals have a “great deal of confidence” to solve societal problems?

1. Individuals

2. Nonprofits and congregations

3. Businesses

4. Government


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More flexible, short-term, task-based work

Personal fulfillment & skill-building over obligation

Choice, customization


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“Encore Stage” and “Half-Time” careers and mentoring

2/3rds family foundations have founders at the table, actively shaping legacy

Online, collaborative

Quicker access to leadership

Self-driven, easily disengaged and detached


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Hyperagency – the inclination and

ability “to be producers rather than

simply supporters of philanthropic

projects.” – Paul Schervish


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Voluntary action for the public good

Robert Payton


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Social economy = all the ways we use private resources to create public benefits or public good

Lucy Bernholz

Phila

nthr

opic

Act

ion

Inve

st

Impact investing

Community investment

Crowdfunding

Impact investing & shareholder activism

Venture funds, B-Corps

Some microfinance

Peer lending platforms

Buy

Tuition & healthcare

Products & tickets

Nonprofit social enterprises

Crowdfunding

Cause marketing

Responsible purchasing

Sustainable supply chains

Farm and artist CSAs

Fair trade purchases

Sharing economy

Giv

e

Charities

Foundations, DAFs

Other nonprofits

Gov’t agencies

Crowdfunding

Crowdsourcing & co-production, co-working

Remittances

Candidates & bundlers

Crowdfunding, prizes, grassroots $

Nonprofits Businesses Individuals

Recipient of Action


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Phila

nthr

opic

Act

ion

Inve

st

Impact investingCommunity investment

Impact investing & shareholder activismCrowdfunding

Buy

CrowdfundingResponsible purchasingSustainable supply chains

CrowdfundingFarm and artist CSAs

Giv

e

FoundationsDAFs501(c)(4)s

Crowdfunding RemittancesCandidates & bundlersCrowdfunding, prizes, grassroots $

Nonprofits Businesses Individuals

Recipient of Action


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How we perceive trust, togetherness, community

Spiritual & social capital

How we work, volunteer, and engage together

How we give, buy, and invest

Human & intellectual capital

Financial capital


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G1: Bob & Barb

(Silent Generation)

G2: Jim, Jenny, Jason

(Boomers)

G3: 7 Grandchildren

(Gen X & Y)

$25M Private Foundation

G1, G2, Atty on Board

50% to Star City

50% G2 Discretionary


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How do present choices impact future success?

Dilemma #1: Engaging grandchildren (Gen X & Y) in the foundation

Dilemma #2: Balancing shared commitment & values with individual interests


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“The capacity to adapt, improvise, and shape change”

“The act of mindful, strategic anticipation”

“The ability to bounce back to healthy functioning after stress”

Family/

Personal

Emotion-based

Loyalty & belonging

Continuity & harmony

More free-form

Task-based

Competence & commitment

Growth & change

More structured

Philanthropic Tools


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Skills

Knowledge

Relationships

Identity

Reputation

Gifts/Grants

Self DAF(or foundation)

PracticesPractices

Policies

Principles & Purpose


Adapted from materials by Patricia M. Angus, Esq.

Grantmaking, operations, meetings, training

Governance, participation, decision-making

Vision, mission, values


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PracticesPractices

Policies



“How we use our resources”

“How we organize and communicate”

“Our shared belief systems”

PrinciplesPrinciples

Policies



Values or principles exercises

Founder/legacy statements

Oral/video histories

Purposeful trusts, ethical wills

Family volunteering


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PrinciplesPrinciples

Policies

PracticesPractices

Decision-making processes

Conflict of interest (legal + ethics)

Board role, eligibility, terms succession

Participation rules (obligation vs. invitation?)

Lifespan, termination and/or transition

PracticesPractices

Policies

PracticesPractices

Philanthropy Practices

Hometown/founder $

Discretionary $

Mission/strategic $

Investments for good

Social, human, intellectual capital – for problem solving, leadership, advocacy


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PracticesPractices

Policies

PracticesPractices

Operationalizing the principles and policies

Making time for storytelling and mutual learning

Keeping family connected to community, beneficiaries

Can family truly self-facilitate, authentically engage everyone?

PracticesPractices

Policies




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Only tool for togetherness

Fighting the last war Killing fun

Connection to founding

Passive participation

Sales May lack incentive, time, knowledge

Expert Advisor

Sophisticated technical resultsMay lack “art of philanthropy” skills

DiscernmentClient clarity, truthtellingMore open to collaborationMay not know all philanthropy trends


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Matthew Wesley

Division & Distribution

Preservation

Growth

Private Foundation + DAFs

Family Foundation + 501(c)(4)

B Corp Investment Fund + Foundation

Checkbook + PAC + Community Dev Bank

Supporting Org + SuperPAC + Impact Investments

LLC + DAF


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1. Intentionality around intersection between family, philanthropy, business cultures

2. Mutual value proposition

3. Governance system (purpose, policy, practice)

4. Form follows function (e.g. goals drive tools)

How will you ensure resiliency in your donors’ philanthropy in the midst of unavoidable change?

navigating trends in family philanthropy

Government & Nonprofit