MacKenzie Scott Nice Time Update!
Turns out that the way she gives money is a really good way.
And now let us check in with breath-of-fresh-air MacKenzie Scott, the heart-of-gold billionaire who spun her share of her divorce from Jeff Bezos after he cheated on her into philanthropy and Yield Giving, a foundation that has so far given out almost $20 billion in unrestricted gifts for social justice, human services (like abortions and health care), education, LGBTQ+ services, playgrounds, historically Black colleges and universities, a total of 2,450 excellent causes that happen to be the ones that piss off Elon Musk and other right-wing chuds the very most!
Turns out, according to a three-year-analysis by the Center for Effective Philanthropy of 800 of the donations her foundation has made, the no-strings-attached way she gives out money is quite effective!
When Scott started handing out unrestricted gifts in 2019, the world of philanthropy got shook. The usual way to go about doling out large sums of cash with a foundation is to give restricted gifts, like for eradicating the rockin’ pneumonia, but not the boogie-woogie flu, or a scholarship fund for sensitive boys with at least a 3.0 who play the flute, or constructing the Phineas Q. Oilman Center for Fracking Studies.
Donors like to direct exactly where their money goes. And they like to have their names on stuff, like etched on a plaque, or a “thank you” in the opera program. Also naming rights are a way to encourage ongoing involvement. Don’t you think dear departed Grandpa Oilman would have wanted his heirs to make sure that his building has plenty of money in trust to keep the center’s roof repaired?
And foundations usually give out grants in response to proposals. This usually starts with announcing the grant: The Betsy VonThundersnatch Foundation For The Arts intends to award $5 million to bring drag brunches to underserved populations. Then nonprofits that work in that area respond with a proposal that assesses the need, lays out project with objectives, includes a step-by-step timetable, detailed budget estimate for renting a van, buying wigs and champagne etc., a pitch of why their organization is the most capable one to meet the need, what the benchmarks for measuring success will be, and so on.
Then after a grantee gets the money, they’re usually required to regularly report back the details of their benchmark-hitting to a board. What some might call micromanaging and others might call responsible stewardship helps foundations and charities solicit gifts, because donors want to know exactly where their money is going and be reassured that it’s not going to get blown fast. Which makes sense! But all of that takes time, and wig money. It can be many months and sometimes even years between when a grant is announced and an awardee can cash a check, and charities have to pay overhead for people to look for grants to apply to, and write the proposals.
But MacKenzie Scott’s Yield Foundation does the opposite of this! They skip the solicitation-and-proposal part entirely, quietly and secretly researching organizations’ track records. And then the foundation cuts a surprise check, with no spending-timetable or strings attached, and lets the nonprofit roll with it. It is bold! It is brave! It is trusting!
And here’s the Center for Effective Philanthropy’s report on how it’s going: The grantees are actually not blowing all of the money. Most are using it to shore up longer-term stability and plan to spend it within two to five years. Some have been able to pay debt, and have reserves and health insurance for their employees for the first time, and they are able to provide more services and expand their missions.
Like the South Texas Food Bank. They were able to give their employees free health care, and also nearly doubled the amount of food they distributed to eight counties and one tribal nation in south Texas with the $9 million Scott’s foundation gave them. Also Kaboom! They build playgrounds, and with Scott’s $14 million they have quadrupled the size of their playgrounds, and have gotten into advocacy too, pushing for elimination of the use of toxic chemicals on playground surfaces.
Eighty-five percent of nonprofit recipients said that Scott's gifts have helped them improve or expand their programming, and 52 percent reported a greater capacity to respond to the needs of the communities they serve. The organizations that received awards from Scott had double the amount of cash reserves as comparable nonprofits, which is vital for the long-term stability of any organization that depends on the kindness of strangers in a volatile economy.
Ninety-three percent reported that Scott's grant moderately or significantly strengthened their ability to carry out their mission, and 90 percent said the gift bolstered their financial positions. More than 60 percent said they used the grant to establish credibility with other funders, though 53 percent were concerned that other funders might withdraw their support, believing that recipients didn't need additional funding. But the other side to that is Scott’s foundation has already done the research, so her endorsement could also encourage more donations. How that will pan out in the end for charities remains to be seen.
And, though the grants don’t require them to, 70 percent of the recipients are tracking the impact of the money, some say even better than they actually were before, because now they have better capacity to do that. Said one, “This grant has allowed us to focus more deliberatively on our metrics and impact to better equip us to answer this question/tell our story/show our impact.”
And what an impact! Samples from the survey: 33,521 loans for a total of $1.26 billion to low-income households to buy homes, start or capitalize businesses, and address their financial needs. Health care for 100,000 new patients. Legal orientation for more than 12,000 refugees, and 200 unaccompanied immigrant minors re-unified with their families, and millions of meals served in the US and other countries.
And her freewheeling gifts are having an impact on other foundations also. More than half of foundation leaders surveyed said that they now thought that their foundations should consider giving out large, multiyear, unrestricted support, too. Which is not simple, because foundations are staffed, structured and budgeted to do things the way they’ve always done them, and it’s hard to get boards to agree on lunch, much less to a complete overhaul on how they do everything, and possibly to re-write of all of their bylaws. But now they have a fine example to follow, and success to point to.
That MacKenzie! She is so humble, it is hard to find pictures of her anywhere, unless they’re from her as Bezos’ plus-one in the old days. And while her ex is out here kissing Trump’s behind, whoring out the newspaper he bought and swanning around Aspen with his affair partner, she is making a difference in a good way. And still the 5th-richest woman in the world.
It’s all lovelier than a drag brunch in June.
OPEN THREAD. (We’ll have something up later too, you know what time.)
[Yield Foundation / Entrepreneur / Center for Effective Philanthropy Report]
What up, peeps?
Open Thread Chat March 4. Pets who actually *like* vacuum cleaners. https://substack.com/chat/1783367/post/37261bfd-da28-4cbd-a34e-792382a6416c