Grant Makers Must Stop Looking for an ‘Exit Strategy’
Before they decide to start supporting a project, grant makers often want to know how they are going to stop giving money to it. “What is my exit strategy?” they ask -- a question that invariably proves difficult to answer, in part because the concept just doesn’t fit philanthropy. The term “exit…
By Mark R. Kramer
Contributor
One Business Maxim to Avoid: ‘Going to Scale’
The application of business concepts in nonprofit groups offers proof of the old adage that a good metaphor frees the mind, then imprisons it. Over the past decade, many principles borrowed from corporate management, venture capital, entrepreneurship, and investment-portfolio management have been…
By Mark R. Kramer
Contributor
Members of Congress Don’t Understand What Good Grant Making Takes
Legislation recently introduced in the House of Representatives would bar private foundations from counting administrative expenses, such as salaries and rent, toward the minimum 5 percent of assets they must distribute annually. The result would be at least $1-billion more in annual grants, surely…
By Mark R. Kramer
Contributor
Should Foundations Focus on Preserving Assets or Their Grant Recipients?
Foundations are still reeling from the precipitous stock-market decline of the last two years. For many, assets have dropped by more than one-third, and the mood is one of pessimism and concern. Some grant makers are increasingly recognizing that this may be a long-term change in circumstances much…
By Mark R. Kramer
Contributor
Will ‘Venture Philanthropy’ Leave a Lasting Mark on Charitable Giving?
A new humility marks venture philanthropists today, a far different attitude than a few years ago, when the venture-philanthropy approach swept the foundation world with revolutionary momentum, challenging philanthropists to emulate its tenets or languish in the hopelessly ineffective backwaters of…
By Mark R. Kramer
Contributor
Helping to Prevent a Culture of Inadequacy
Foundations often complain about the inefficiency, duplication of services, and “lack of scale” that characterize many of the small charitable organizations they support. Grant makers believe that they are forced to make numerous small grants because there are so few large, well-managed…
By Mark R. Kramer
Contributor
Perpetuity: the Real Issue in Payout Debate
Economists, foundation officials, and charity observers have been spending a tremendous amount of time recently talking up reports that arrive at an exact percentage of assets that foundations should be required to give away each year. Some studies, citing market performance over the course of many…
By Mark R. Kramer
Contributor
Grant Makers Shouldn’t Play With Matches
Making a matching grant seems like the easiest way for a foundation to get the most “leverage” from its giving. By requiring other donors to follow its lead and support a charity, the foundation ends up generating two, three, or even four times as much as it gives away. Every foundation that…
By Mark R. Kramer
Contributor
Markle’s Bold Bid Leaves Some Big Questions
The John and Mary R. Markle Foundation’s decision to spend $100-million over the next three to five years to finance Internet-related projects (The Chronicle, July 29) is to be commended on many counts. First, by electing to move in such a dramatic new direction, foundation president Zoë Baird and…
By Mark R. Kramer
Contributor
Venture Capital and Philanthropy: a Bad Fit
An increasing number of foundations like to think of themselves as venture capitalists, investing in new organizations and helping them grow. The comparison is attractive, even romantic in a swashbuckling sort of way. But as I can attest after years in both philanthropy and venture capital, it is…
By Mark R. Kramer
Contributor