SOE Philly

On February 23rd I attended SOE Philly presented by Watershed Capital Group and Delaware Valley Grantmakers. SOE stands for Sustainable Opportunities & Education. The event is a roadshow of investors active in the impact investing space and presenters from investment management firms and funds whose aim is to make money in sustainability and social change. The half day conference was attended by over 70 people from all walks of life interested in the space.

Watershed Capital opened the event with a high level presentation on who Watershed is and the myths associated with the impact investing space. In their words, Watershed Capital advises and assists venture capital, private equity and debt funds raise capital from institutional investors; raises private equity and debt capital for operating companies; advises and executes mergers and acquisitions; and provides corporate financial advisory services. Here are the myths they see as it relates to impact investing:

1. Impact investing sacrifices financial return.
2. Impact investing while interesting won't achieve scale.
3. Impact investing is a new field with no track record.

Antony Bugg-Levine was the morning's keynote speaker. Bugg-Levine is the current CEO of the Nonprofit Finance Fund and author of Impact Investing. Bugg-Levine spoke about the opportunities, challenges and lessons from the impact investing space.

There is a traditional view of the world where it is believed that assets should be/are invested to make money and that social issues are addressed through charities and government. Bugg-Levine hypothesizes, "What if this world is not true?" The investment management function and the grant making function are separate worlds which do not touch. Each camp is suspect. The impact investing world asks the question, "What are all of the assets doing for impact?" What is missing largely is a truly integrated way of managing a foundation.

Bugg-Levinbe says that institutions are overcoming these challenges:
1. Leadership is taking an active role to integrate.
2. Institutions are engaging the whole body in a mind shift.
3. The best investors are collaborating.
4. Intermediaries and advisors are needed to connect institutions to deals which are related to the organization's mission and values.

Bugg-Levine closed with the notion that impact investing is not new. Social Responsible Investing (SRI) and micro finance have been around for quite some time. What is new is the language.

The first panel featured institutions actively engaged in the space of impact investing. Laura Kind McKenna, Managing Trustee of the Patricia Kind Family Foundation, is a strong advocate for all foundations to simply get started and experiment without delay. This was supported by the other panelists who spoke of their individual experiences in the space. Kate Starr from F.B. Heron Foundation talked about her organization's goal to move from their current 40% allocation to 100%. I think what is missing, but what is greatly needed amongst foundations (and in particular small, unstaffed foundations) are advisors who can educate, help create a framework for decision making and source and select opportunities.

The second panel featured representatives from firms managing assets to generate positive financial return and meaningful impact.

The Reinvestment Fund (TRF): TRF finances neighborhood revitalization and has invested over $1 billion in Mid-Atlantic communities since 1985. TRF provides opportunities to lend a minimum of $1,000 up to $5 million for a period of 3 to 30 years. TRF Core Loan Fund has been around since 1986 and currently has $123 million in assets. Investments include housing, supermarkets, businesses and commercial real estate to provide jobs, community facilities like charter schools and social service programs and sustainable energy projects. The Fund has the highest CARS rating of AAA +1.

SJF Ventures: SJF started out as the Sustainable Jobs Fund. The firm recently merged with Investors Circle. SJF is a growth-stage venture capital fund. The funds are 10 year limited partnerships with allocation over a 5 year period. Cash flow is distributed in years 4-10. The minimum is $250,000 for individuals and $1 million for institutions. Representative investment areas include renewable energy and efficiency, organic and healthy consumer products, digital media, and outsourced business services.

Microvest: Microvest manages a family of funds that make debt and equity investments in micro finance institutions and other low-income financial institutions. Microvest assesses the risk of the institutions making the loans. They featured their Short Duration Fund which was launched in September of 2010. They currently have $29 million invested and are seeking to raise $100 million. The fund buys debt instruments and term deposits of low-income finance institutions (LIFIs) which include microfinance institutions (MFIs).

Community Capital Management: Community Capital Management is a fixed income manager which invests in government-related sectors of the bond market. Their goal is to produce above-average, risk-adjusted returns while providing a positive impact on the community and the environment. They typically invest in single family agency mortgage-backed securities (MBS), multi-family agency MBS, Taxable municipal bonds and small business administration (SBA) pools/loans. The CRA Qualified Investment Fund focuses on supporting community development activities like affordable rental housing, home mortgages, neighborhood revitalization and environmental sustainability programs.

There are opportunities out there to get started and to experiment in this space of impact investing. But, I keep thinking about small foundations which do not have staff....how do they get started?

They don’t have staff to investigate;
They don’t have a framework to integrate;
They don’t have access to opportunities;
They don’t have measurement capabilities to monitor impact.

My thoughts also lead me to think about how impact investing can go mainstream. I think what is missing from this discussion is distribution. Mutual funds became the way for individual investors to invest because distributors could be easily compensated. Traditional distributors - Registered Investment Advisors - are largely missing from this business chain. Unless compensation to distributors is figured out, impact investing will remain within Foundations and more specifically those institutions with resources to understand it, to create the framework for decision making and to measure the impact.

The What and How of Community Impact

Check out the latest edition of the Philadelphia Social Innovations Journal which was released today. The edition focuses on Innovations in Community Impact. My Philanthropy Column can be accessed here!

What is interesting about this concept is the approach—the proactive decision to collectively tackle some desired state of change. Community impact is about people and organizations coming together to improve a situation in a measureable way.

There are many ways that innovation can address needs and positively impact a community. Some of the exciting local endeavors included in this edition of the Journal:

Dan Hilferty and Independence Blue Cross’s newly created Social Impact Foundation that serves as a model for Corporate Social Responsibility and Responsible social investing;

Kenny Gamble, a successful real estate developer in South Philadelphia who took the unusual step of getting into the business of education, seeking to address at a holistic level the social ills that plagued local neighborhoods by focusing on schools as a way to redevelop a sense of pride and ownership within communities;

Anne Marie Ambrose and the Department of Human Services’ program, Improving Outcomes for Children, which aims to improve service delivery and outcomes for children in care by engaging community partners, streamlining case management and vigilantly tracking outcomes indicators to measure the initiative’s success;

District Attorney Seth Williams’ commitment to The Choice is Yours (TCY), an alternative-to-incarceration program to increase public safety and reduce recidivism rates by diverting first-time, non-violent felony drug offenders away from prison and into the labor market through positive job training and support;

Ann Karlen and Fair Food’s strategy to strengthen the Philadelphia regional food system by increasing the demand for a humane, sustainable, local agriculture system; and

Dr. Lee Nunery and the School District’s efforts to create alternative education settings that ensure all students can succeed in schools and their partnership with colleges to create direct college access and completion pipelines.

Check out the full edition here! Enjoy!

Strategic Philanthropy in the New "Normal"

I sat in on a webinar presentation today hosted by Guidestar. The speakers defined what they refer to as the new "normal." 800 people actually attended the webinar as a side note. This is clearly a deserving topic for discussion.

The recession's impact is far reaching. Institutions reliance on philanthropy will continue to increase as a result. Strategic philanthropy continues to redefine itself and the reality is that bold leaders who embrace the new normal will succeed. Those who don't will slowly fail. Yesterday's news of the closing of Hull House in Chicago is going through my mind as I listen to the speakers.

What were the key elements of a traditional campaign model? Campaign was driven by the organization's strategic plan or feasibility study. Institutions put together a high level campaign committee and there was a sequential ask of donors from the top-down. There was typically a limited gift acceptance policy in place. The campaign was volunteer driven, but staff supported. The typical time frame was 5 years.

So what rocked this model? The global economy went south. Funding sources shrunk. Regional economies remain volatile. Government support contracting. Reliance on philanthropy increases. Business methods applied to grant making. Social media fundraising grows.

What are the key elements of a new normal campaign model? Recession recovery will endure for 3-5 years. Campaigns will begin and end during this period. Pressure on philanthropy is acute and needed more than ever.

There is definitely a new era of fundraising: Fundraising is strategic and mindful of the new world. Fundraising is aimed at a new type of donor. Campaigns are unannounced. No campaign chair(s). No steering committee. Donors become leaders and leaders become ambassadors. Staff driven cultivation and asks. Decentralized volunteer structure. Fundraising is continual.

From a planning perspective, organizations need to integrate strategic and philanthropic plans. Strategic and philanthropic planning NEVER stops.

Organizations must take another look at Case Statements and their purpose. Its about the parts, not the whole. Strategic plans supersede case statements. People connect to programs, not organizations. It is less about bold and more about achievable results. Sustainability is a constant issue

A word about campaigns: They should never end. Organizations need to weave together operational and strategic initiatives into comprehensive campaigns. Strategic plans require strategic philanthropy. Gift structuring (annual, bequest, cash) changes donor relationships and stewardship.

Organizations need to think about cultivation differently: Fear and uncertainty drive donor caution. Donors less willing to part with their capital. Large gifts take longer to consummate. Gift structuring reduces near term cash outlays. Gift tables bulge at the lower middle. Largest gifts come from unusual sources.

At the core of all this is that a key success factor is having givers become leaders. Old fashioned campaign committees are out! Campaigns commit donors to the parts of the mission they care about the most. Givers become philanthropic leaders in critical subsets of the organization. These subsets motivate donor enthusiasm. Boards don’t always turn to philanthropic leaders as members.

The R-Word

This was originally posted by my friend, Abigail Sandler. Abby's beloved sister, Aimee, was profoundly developmental and physically disabled. For the 53 years that Aimee graced this earth, Abby heard the R-word being used everywhere, and it was a constant reminder of the pain Aimee endured, on all levels. It's time that the masses became sensitive to the needs of others, and start dignifying their language and actions towards those truly unable to help themselves. Aimee might have been disabled in many ways, but like the song said, "Once In Love With Aimee, Always In Love With Aimee!"

Aimee's legacy was enormous, and if you go to: www.aimeesbulletin.com
you'll learn how one person, no matter how disabled, can make a huge difference, and ultimately impact the lives of others throughout the Great State of Pennsylvania.

Being Retarded
Blog entry (December 23, 2011) by Phoebe Holmes; Herding Cats

All around me, people use the word retarded without a second thought. Sometimes, I’ll say “Um, dude, really?” and they’ll say “Oops, my bad! But really! I was being so retarded!”

Sometimes, I let it slide. I realize that it’s a word that’s ingrained in our society’s vocabulary and people use it without a second thought to its meaning.

But what does it mean to be retarded? Well, I know what it doesn’t mean.

It doesn’t mean not being able to choose something for lunch despite 100 choices in front of you.

It doesn’t mean not being able to find your car keys.

It doesn’t mean saying the wrong thing to a person.

It doesn’t mean forgetting your best friend’s birthday.

It’s not something to describe yourself as when you’ve spilled your coffee, or tripped on a crack in the sidewalk.

It’s not something to describe your computer, car or phone.

According to Merriam-Webster Dictionary the word “retarded” means -

: slow or limited in intellectual or emotional development or academic progress

For me, it’s not just any old word – it’s my daughter. My beautiful, bright, happy, loving, amazing daughter who is slow or limited in intellectual development and academic progress.

In our household, being retarded means something different.

It means not being able to fully care for yourself.

It means not understanding what the doctor is going to do to you.

It means not being able to explain what hurts when something hurts.

It means not being able to ride a two wheeler. Or read. Or ever be able to live on your own.

But ever the optimist, I also know that retarded means…

…never realizing the negativity behind the word retarded.

…never knowing the insensitivity surrounded the word’s usage.

…never realizing the ignorance of people.

…never knowing how other people view you.

Being retarded also means…

…loving unconditionally.

…finding joy in the smallest of things.

…being self-confident.

…not realizing that there are limitations.

…innocence.

This is Maura. Her diagnosis? Cognitively disabled. Which means retarded. When you call yourself retarded, you’re also calling my child stupid. Because you use the word as just that – another form of stupid.

Let’s get something straight here.

My daughter may have cognitive issues. She may have delays. She may never live on her own. Scratch that. She will never live on her own.

But Maura is not stupid.

In her own way, Maura is very smart. Maybe smarter than us at times. She has more self-confidence than anyone I know who’s called themselves “retarded”. She is the best judge of a person’s character than anyone else I’ve ever known.

Yes, she is slow to learn things. But she is not stupid.

I know that most people don’t use the word “retarded” maliciously. Most people I know use it in a self-depreciating way. And when I point it out, they go “Oh wow! I’m sorry!” and they truly feel like a heel. But the thing is, you’re still using it in the way that people who do use it maliciously use it as – to describe stupidity.

So why not just use the word “stupid” instead? Because I know what “retarded” is. I live with it in the form of my daughter. And in our world “retarded” doesn’t equate to “stupid”.

5 January 2012 – feel free to read this companion post, which helps explain more of the “behind the scenes” view of this post – thanks!

Night Out With Meaning: Phoebe Driscoll

Last week Phoebe Driscoll was Night Out With Meaning’s storyteller. Night Out is about learning, connecting and reflecting. It is my hope that those who attended took away knowledge that they didn’t have before, that they met someone new or discovered something about a friend that brought them closer. And it is also my hope that there were pieces from Phoebe Driscoll’s story that made them stop and reflect about their own lives and experiences.

I certainly spent time reflecting on Phoebe’s life story. Phoebe exudes wisdom in a way that makes you feel like she’s lived it and she’s simply going to let you in on a few things she’s learned along the way. I thought about where she came from and where her life landed her based on her “gut and luck!” I love how she is entering her eighth decade and still sees work to be done around land preservation. I thought a lot about her awareness and consciousness of her place in the world, how she contributes to its betterment and how she will one day leave it. I thought about my part, what I am doing and how aware my young children are of nature and the environment. I’ll say it…we take the Wissahickon and surrounding land for granted. We can literally step outside and find ourselves on a wooded trail. And I admit, I didn’t think much about how that land was preserved – until now. Someone said this is beautiful and someone said we must take care of it and preserve it for future generations. Phoebe realized this early on and works very hard to make that a reality. Thank you, Phoebe. And thank you to Anne Standish and Nancy Venner from the Wissahickon Valley Watershed Association for introducing all of us to Phoebe.

If you are interested in learning more about the outreach programs of the Watershed, check out www.wvwa.org.

The next Night Out With Meaning will be in February of 2012. More information to come shortly! Remember to invite a friend and make it a Night Out!

DVG: Holding Together in High-Wire Times

Last week I attended the Delaware Valley Grantmakers fall conference. Harp-weaver was also a co-sponsor for the event with Phillips Philanthropy Advisors. 300 funders and representatives from nonprofit organizations gathered together under the theme, “Holding Together in High-Wire Times.”

Jeremy Nowak, President and CEO of the William Penn Foundation provided introductory remarks. As the Foundation is in the midst of a strategic planning process, Jeremy shared some fundamental advice: 1) Think about innovation and ask yourself how to do something better. 2) Be willing to rethink and restructure your organization in order to save legacy. 3) Drive towards outcomes versus output.

Nadya K. Shmavonian, President of Public/Private Ventures, moderated a panel discussion on “What’s Happening” in the sector. The panel included: Patrick E. Bokovitz, Director of Chester County Department of Community Development; Virginia Frantz, President and CEO of Montgomery County Foundation, Inc.; Donna Frisby-Greenwood, Philadelphia Program Director for the John S. and James L. Knight Foundation; Jeffrey Gordon, Manager of Community Relations for PECO; Stacy Holland, CEO of Philadelphia Youth Network; and Farah Jimenez, President and CEO of People’s Emergency Center.

Here is a summary of the points discussed:

• Are there too many nonprofits too small to succeed?
• Focus on collaboration in order to solve problems.
• Narrow focus – do what you are good at: build program models; focus on operational infrastructure; convene leadership networks
• Funders and organizations should co-create outcome measures over time and take a long-term approach.
• Funders should think about policies related to capacity building – grow capacity and help attract new donors

Night Out With Meaning: November 10th

Described as "a dreamer and a doer" Phoebe Driscoll's hard work, lasting resolve and inspiring dedication to land conservation has benefited us all. She attributes who she is today to growing up on a farm, having a woman's education in the forties and fifties, a supportive husband and luck! We are thrilled to have Phoebe as Night Out With Meaning's next storyteller on November 10th.

I am thrilled to invite you to Night Out With Meaning: Women & Giving; a series of evenings for women to be inspired by the stories of women like Phoebe Driscoll.

Held at The Philadelphia Cricket Club in February, May and November, each Night Out With Meaning focuses on a topic and features a wonderful storyteller. Night Out With Meaning is for women to connect with others, to learn from extraordinary women through their stories, and to find meaning in personal giving.

The fourth Night Out With Meaning will be held on November 10th at 6:30pm. The topic is "Protecting the Land & Environment." On a personal, community and national level Phoebe has committed her married life --- what's left after family affairs --- to volunteer activism in protecting the land and environment. For thirty-six years she has served on the board of the Wissahickon Valley Watershed Association (WVWA).

To register for the event, click here. I look forward to sharing the Night Out With Meaning with you!