MacKenzie Scott gifts help bolster nonprofit infrastructure

AP Business
MacKenzie Scott, MacKenzie Bezos

FILE – In this March 4, 2018, file photo, MacKenzie Scott arrives at the Vanity Fair Oscar Party in Beverly Hills, Calif. Umbrella groups that serve and advocate for nonprofits or grant makers and donors are an unsexy part of the charitable world. But that might be changing as Scott shines a very bright spotlight on those organizations’ work. Dozens of such groups received unprecedented multimillion-dollar donations in Scott’s latest round of giving with her husband, Dan Jewett. (Photo by Evan Agostini/Invision/AP, File)

Umbrella groups that serve and advocate for nonprofits or grant makers and donors are an unsexy part of the charitable world. They act as scaffolding to strengthen organizations that do good by bringing nonprofit leaders and philanthropists together to learn from one another, conducting research, and doing advocacy. The groups have long received few philanthropic funds and have struggled to win attention from individual donors.

But that might be changing as MacKenzie Scott shines a very bright spotlight on those organizations’ work. Dozens of such groups received unprecedented multimillion-dollar donations in Scott’s latest round of giving with her husband, Dan Jewett.

“I’ve been working for philanthropy infrastructure groups of different types for over 20 years now, and I’ve never in my career experienced a gift like this,” says David Biemesderfer, the CEO of United Philanthropy Forum, which received $3 million from Scott.

Roughly 70 regional and national “infrastructure” organizations received gifts from Scott. Many of them include social- and racial-justice and equity components in their work. The Chronicle focused only on national groups for this article. Of the 53 national groups it identified, 26 either publicized how much money Scott had given them or told the Chronicle how much they had received. Those that disclosed how much they received got a total of $146 million. Contributions ranged from $2 million to $15 million.

Scott’s total giving to these groups is remarkable since it’s coming from an individual donor. In one fell swoop, Scott gave hundreds of millions. U.S. foundations gave $1.9 billion to infrastructure groups from 2004 to 2015, according to a study conducted by the William and Flora Hewlett Foundation and the Foundation Center.

It’s unclear whether Scott’s giving signals a new era of wealthy donors giving big to these kinds of umbrella organizations.

Most donors don’t understand what these groups do or why they matter, says Kelly Fitzsimmons, the founder of Project Evident, which received $3 million from Scott and helps nonprofits and foundations measure what works. That is one of the reasons so few individuals give them large sums, she says.

“If other wealthy donors better understood the nature of this work, they would follow her lead,” Fitzsimmons says. “We’re in a corner of the nonprofit world that is just not well understood, but it’s a significant area of impact.”

Yet Scott’s gifts have helped leaders at these organizations raise awareness about their work, which could increase their chances of attracting gifts from other individual donors.

One wealthy donor recently told Nicholas Tedesco, the head of the National Center for Family Philanthropy — an organization that advises and educates wealthy donors about effective grant-making practices — that the donor’s family is considering an earlier grant request since it learned Scott gave the center $4 million in June.

“They very explicitly said to us that the gift will allow a grant request from us to be considered with more seriousness because of the due diligence that has been done by MacKenzie and Dan and because the family wants to know that they’re not the largest funder of the organization,” Tedesco says.

Scott’s $2 million donation to Native Americans in Philanthropy, a coalition of grant makers, tribal leaders, and others who advocate for increased philanthropic support of Native American organizations, raised the group’s public profile, says CEO Erik Stegman. He was even invited to appear on “Good Morning America” to talk about Scott’s latest donations.

MacKenzie Scott is practicing the kind of philanthropy nonprofits have been asking for, Stegman says — to “give up power to the organizations and communities that know best.”

“I’m able to point that out to people who don’t know much about our work or even the philanthropic sector,” he says, “but they know enough about MacKenzie Scott and what she’s up to that it starts a conversation.”

News coverage that focuses breathlessly on the size of Scott’s gifts misses an important point, says Elizabeth Barajas-Román, who leads the Women’s Funding Network, which received an undisclosed sum from Scott. What’s more significant, she says, is the way Scott’s money focuses on groups unaccustomed to the limelight.

“It gets people to pay attention and wonder, ‘What are women’s funds? What are they doing, and why did MacKenzie Scott pick a women’s funding network?’”

Many of the umbrella groups that received gifts from Scott are still figuring out how they will use the money. Almost all said they plan to use some of it to hire more staff and build up their technology and data capabilities.

Independent Sector, a national membership organization of nonprofits, foundations, and corporate-giving programs, received $6 million from Scott last July and put the money into a board-designated fund so that it could be invested and grow but also be used to support specific internal needs.

“We were in the middle of the pandemic, and we didn’t know what would happen to membership or if there would be a massive downturn in the economy,” says Dan Cardinali, the group’s CEO. “We wanted to make sure we were living within our means for our normal operations.”

GivingTuesday, an organization that encourages generosity around the world, plans to use the $7 million it received to further expand in East African countries, India, and elsewhere, says CEO Asha Curran.

Scott’s gift was the biggest GivingTuesday has ever received from an individual donor, as has been the case with many of the umbrella groups. Yet Curran says the gift doesn’t change her group’s fundraising plans.

“This gift literally did not give us a break from fundraising for even a day,” Curran says. “We’re not sitting back and declaring victory; we’re looking at how we add to this gift and continue to add to it.”

But the money does give the groups more breathing room. The $4 million that Grantmakers for Effective Organizations received is a substantial amount but not so substantial that it can save it for a rainy day, says CEO Marcus Walton.

“It allows us to do what we’re doing without the typical budget constraints,” he says. “We still need to prioritize, but we don’t have to do so from a scarcity mind-set. We can be a little bit more abundant in our thinking.”

Walton’s group, a membership organization that helps grant makers improve their philanthropy, is using some of the money to broaden training programs that bring foundation leaders and staff up to speed on best practices on racial equity and justice. The goal is for foundations to have a clear sense of their values and to be connected with the people they serve, something Walton says many grant makers struggle to do.

Several organizations are concerned that longtime donors will assume that Scott’s gifts are enough to take care of the nonprofits for years to come, which they say is simply not true.

“These gifts help to free us up a bit to expand the possibilities but only if we continue to get the support we’ve had and can build on that,” says Biemesderfer, of United Philanthropy Forum. “It shouldn’t be viewed as replacement funding or else it kind of defeats the whole purpose.”

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This article was provided to The Associated Press by the Chronicle of Philanthropy. Maria Di Mento is a senior reporter at the Chronicle. Email: maria.dimento@chronicle.com. The AP and the Chronicle receive support from the Lilly Endowment for coverage of philanthropy and nonprofits. The AP and the Chronicle are solely responsible for all content. For all of AP’s philanthropy coverage, visit https://apnews.com/hub/philanthropy.

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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