Celebrating Next Generation Philanthropy

The featured speaker for the forum was Robyn Schein, Senior Consultant at 21/64, an independent practice providing multigenerational advising, facilitation, and training for next generation engagement, with a focus on family philanthropy. She formerly served as Director of the Family Philanthropy Resource Center at The Minneapolis Foundation, where she created Fourth Generation, a program for next gen donors. Schein shared an overview and examples of findings from the 2^nd edition of Generation Impact: How Next Gen Donors Are Revolutionizing Giving, written by Sharna Goldseker, founder of 21/64, and Michael Moody, the Frey Foundation Chair at the Dorothy A. Johnson Center for Philanthropy.

Setting the Stage

• Regardless of stage or age, or assets, next gen donors have the desire to figure out what has come before them so they can manage expectations and also explore possibilities.
• There are currently an estimated 1.5 million nonprofits in the U.S. and 10 million globally. Sometimes, the overwhelming array of choices can lead to paralysis — donors may not know how to get started.
• 21/64 was created to help donors realize what is possible and how to use their potential, with the name synonymous with ages: 21 for when the next generation is coming of age and often invited into conversations about wealth, and 64 for when the current generation is thinking about retiring or about an encore career.
• The context in which the 1^st edition of Generation Impact: How Next Gen Donors Are Revolutionizing Giving was written in 2017 included that 43% of all wealth in this country was held by 1% of society and that between 2007 and 2061, there will be an estimated $59 billion in wealth transfer – which will create a remarkable amount of money available for charitable giving. A 2^nd edition was created in 2020.
• Overall, current generation givers (boomers) tend to be loyal givers who stay true to organizations they have committed to. Next gen givers feel more loyalty to the impact of their giving or to a particular cause.
• Four next gen philanthropy strategies explored in the book include: 1) Working in a multi-generation context 2) Innovation 3) Going all in 4) Aligning values.

Working In a Multi-Generational Context

• Traditionally, wealth is distributed in a “baton pass” as part of a trust fund, legal transfer, or other method. Next gen donors prefer to be part of a multi-generational team, as they see value in working with an older generation for their knowledge and experience.
• As people are living longer, the ability to work across generations is paramount. There are more opportunities to have shared experiences with the younger generations to help build the social fabric across generations, and to practice such things as active listening or constructive feedback.

Innovation

• Next gen donors like to think boldly and experimentally, and they are leading their families to align ideals with investments.
• They are seeking ways for their giving to have impacts that go beyond traditional philanthropy.

Going All In

When next gen donors find what they are interested in, they tend to “go all in”— giving their time, talent, treasure, and ties (relationships with trusted nonprofits is an important additional factor for this generation).

• Time: For context, 75% of next gen donors studied in the book were already volunteers (time) by the time they were 15, and 90% were actually giving (treasure) by the time they were 21. What this data means is that by the time these philanthropists are asked to serve on boards, etc., they may have years of experience. It is important to consider this experience and provide enough power and decision making so they feel their impact matters and will stay engaged.
• Talent: Next gen donors are sometimes asked to contribute in ways that don’t fully leverage their skills and expertise (i.e., picking out napkin colors for a gala). They are seeking more meaningful opportunities to build on their talents — and to be involved in ways that build on their knowledge and experience.
• Treasure: Next gen donors may have broader portfolios than simply money — some of the considerations are property donations, business donations, etc.
• Ties: This generation is the most highly networked demographic, and their network is a huge asset and part of what they offer. If they don’t have the talent directly for what a group or organization needs, they might know someone who does. They have a huge desire to develop relationships and have ties with grantees and often like to have a hand in helping them problem-solve.

Values

• This next generation is choosing to live lives that align with their values, and this shows up in how they function as investors and as consumers.
• One example is a Grand Street 20-year evaluation of a 2003 program focused on Jewish millennials. When the participants were asked what they took away, the summary was: Clarity of values can help philanthropists find their voice, and that helps them have the confidence to take action and align those actions to meet their values.

Philanthropic Identity

Next gen donors often benefit from exploring and defining their philanthropic identity, and it forms the basis of the work that 21/64 does. This involves asking important questions such as:

• What am I inheriting? This question helps them understand whose shoulders they stand on, and what characteristics or values may be passed on to future generations.
• Who am I? This question helps them determine what they wish to continue or let go of, and what values are most important to them.
• What do I want to do about it? This question helps them determining what they want to fund, how to allocate resources, and where to put their energy.

Trust-based philanthropy is a movement popular with next gen donors that is more relationship-based than infrastructure-based; for example, foregoing extensive grant reporting requirements (which can be time-consuming and expensive for many nonprofits, particularly if they are smaller) in favor of personal conversations.

To prepare next gen donors, some organizations/philanthropists use the concept of a junior board, in which teenagers/minors can get involved to learn by doing — for example, letting them help make grantmaking decisions and recommendations for a certain amount — with the governance and final decision-making resting with the regular board. It is important to be clear about the limits/amount of power or authority held by a junior board in order to let them know up front the stakes of their engagement, so there is no confusion down the road.

Schein closed with a quote:

“Everyone has a role to play…you don’t have to wait — you can start now.”

–Daniel Lurie, Founder of Tipping Point Community–