smaller foundations make big impact

March 18, 2007

Foundation trend: Less is more

March 12, 2007
by Frank Sietzen for The Examiner

WASHINGTON – In the nonprofit sector, size does matter. There are an estimated 60,000 small foundations in the United States, most with a handful of employees and all-volunteer boards. Yet they account for half of the money distributed each year by all foundations. What makes these smaller groups different is their focus. While larger organizations tend to address broader issues, their more petite counterparts aim much closer to home, focusing on community giving targeted directly at local needs.

Though large and small have their place in the nonprofit sector, smaller foundations are effecting change greater than their size and numbers suggest. It is the smaller, often family foundations that many believe are the wave of philanthropy’s future.

“We tend to be less bureaucratic, and as a result can respond more quickly to local needs,” Carl M. Freeman Foundation Executive Director Cheryl C. Kagan said. Kagan told The Examiner their grant-making process was aimed directly at smaller local nonprofits. The application could be downloaded from their Web site and consists of a two-page form that can be filled out in a short time.

“We’ve made it a do-it-yourself process,” Kagan said. Her foundation, which has created a special category of small grants in the $500 to $2,000 range, tries to help community groups with such things as uniforms and funding for one-time events. “We can’t answer hundreds of phone calls [to apply for help], so we make it easy for the local applicant,” she added.

Another small group also working close to home is the Community Foundation for the National Capital Region. Based in D.C., the group helps parents in the region become more involved in their children’s education and advocate for tangible improvements in their schools, said spokesperson Ben Glenn. This included helping teachers raise test scores, purchasing classroom supplies and even repairing school buildings.

Some 3,000 small foundations have banded together to form of the Association of Small Foundations, a D.C.-based association that addresses their needs. Their members often have no more than two people as staff, and half of them operate with volunteers alone. As for assets, about 250 of ASF’s members have over $50 million in assets — but the average size is $18 million, and half have under $7 million. But their numbers are growing. When the organization began 11 years ago, it had less than 60 members. By 1998, that number had swelled to 1,379, and has since more than doubled to 3,200, adding about 300 new small foundations every year. It is now the largest association of grant-making nonprofits in the United States.

“Our members tend to be givers who have made a long-term commitment to help their local communities,” ASF CEO Timothy Walter said. “They can be more constant supporters of nonprofits in their areas, because these donors are usually people who are highly visible in their communities.

“They have both feet in the water,” Walter said, and usually both live and work where they have identified a need that their foundation tries to fill.

Copyright 2006, All Rights Reserved.

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