Buying Into Giving - The World of Modern Philanthropy

The Australian Financial Review

11/17/2005

It’s a battle for smaller arts companies to attract fund-raising attention writes Lydall crisp

Kingsley Aikins is no shrinking violet when it comes to asking people for money. Nor is he backward in giving the arts community advice on how to attract financial support.

As CEO of one of the world’s most successful fund-raising models for cultural activity, The Ireland funds, Aikins calls himself a “messianic messenger of philanthropy”. Having helped raise US$230 million since the fund was begun 30 years ago by Tony O’Reilly for projects in Ireland, he knows all the tricks.

There has been an “absolute explosion” of philanthropy in the US, Aikins says, that’s mostly to the massive creation of wealth – “the greatest catch of wealth in the history of mankind” – in the 1990’s.

“About $US60 trillion [82 billion] is going to be transferred over the next 40 years from the people who have it now to three different destinations,” he says: heirs, tax, and philanthropy.

While Americans gave $US250 billion to charity last year- up 11 cent on 2003- Australians donate $428 million annually to arts and culture organizations. But it’s really only the Australian ballet, Opera Australia, and a few national galleries that have mastered the art of wooing a benefactor.

Philanthropy, Aikins says, who addressed a meeting of arts bosses in Sydney and Melbourne this week as a guest of Artsupport Australia, is now an industry. No longer the exclusive domain of ladies who lunch, fund-raising is recognized as a full time profession.

Harvard University, he points out, has a fund raising staff of 600. “The sector is becoming more organized,” he says. “in fact there’s an interesting morphing going on between the business world wanting to become more involved in philanthropy and developing their corporate social responsibility, and the non-profit sector wanting to become more business like.

“And it’s a paradigm shift; we have new types of philanthropists emerging and there different from the old ones. They’re young creators of wealth rather than inheritors. They want to apply to the non-profit organisations the same business principles that allowed them to create wealth in there own business.”

“The new philanthropist doesn’t have a black tie, he doesn’t have any tie.”

Based in Boston but constantly on a plane to somewhere Aikins says the healthy Australian economy had generated enormous wealth among people who are now at an age where they’re wondering what to do with it.

“We talk about our donors moving from struggle to success, and from success to significance. You reach a period in your life when you think; what do I want to be known as- the guy who sold the most widgets or do I want to build a library or museum or help with malaria in Africa.”

“What they look for is organizations that can deliver. Money is attracted by strength not weakness, so the old begging-bowl, Robin Hood notion of philanthropy doesn’t work. And the vocabulary of our industry has changed. People talk about investing philanthropically rather than giving.”

The modern philanthropist, Aikins says, takes a portfolio approach to investing- spreading his philanthropy over a wide range of interests from the arts to medical research to third world relief.

So it’s a battle especially for small arts companies, to attract attention. That means the weaker ones won’t survive while others might merge- as it happened in Seattle- to become stronger.

His advice to arts companies:

“Fundraising is a process- research, cultivation, solicitation, leadership and stewardship- not an art or science: 90% is research, finding and identifying people who have the capacity and propensity. You have to attract major gifts, rather than $20 or $30 contributions.”

“Cultivation takes years; it’s driven by a simple axiom: strangers don’t give. You can’t send out a letter to 1000 people and expect money to come in.”

“The new philanthropists want to be engaged: it’s about involving people, them participating in the organization, them moving from saying, what you should do, to what we should do.”

“You have to make quality moves with a donor over two or three years before you can ask them for a gift, by which stage they’ll so proud and enthused and excited about what you do that they’ll be ready to give.”

Then-and this, Aikins says, is where many organizations fall down- you have to ask for a specific amount for a specific cause over a specific length of time.

“It’s the brutal bit but you have to do it. The reality is that if I’m not asking these donors, someone else is.”

“The final piece of the jigsaw is stewardship. We regard every gift as a part of a life cycle of giving. So many examples I can look back to where the first cheque com in for $US500 and that person is now at $US5 million or $US10 million.”

Thanking the donors and telling them what their money has achieved is another must. Everyone who donates to the Ireland Funds gets five responses, four from the board members.

Talking of boards, there are 66 members on The Ireland Funds board and each gives $US100, 000 a year to the fund and each has a job spec, a detailed list of expectations, the main one being to raise money.

“We are tough in America,” Aikins says. “We have a give, get, or get off policy on boards. If you don’t give or don’t get, then you can’t stay on the board. It’s harsh, but everyone understands it.”

A board decision is no longer about just ticking decisions already made by executive staff, attending opening-night parties and a couple of lunches. The No. 1 priority, he says, is to ensure the financial viability of the organization.

And that requires people skills.

“As long as I’ve done this job, nobodies ever flown to Boston, taken a cab downtown, come up to my office and given me a cheque.” he says “ [Former presidential candidate] Barry Goldwater said, you gotta go shooting where the ducks are.”

“It’s not just your usual suspects. There are depths of wealth in society here that are quiet and unknown and it’s about beginning the dialogue with these people, making them feel like insiders in your organization so they feel it’s an extension of their values. Then things happen.”

He points out that the most successful organizations start small. O’Reilly launched The Ireland Fund – based on the philosophy on the United Jewish Appeal which raised billions of dollars for Israel- at a dinner in New York in 1976. It was a dismal failure. The only reason there was a second dinner was to pay for the first. .

But this year the fund has held 70 events in 39 cities in 11 countries attended by 40,000 people. Recently it has given $US50, 000 to the opera festival in oxford, $US300, 000 to the Gate Theatre in Dublin and $US50,000 to the Abbey Theatre, Ireland’s national company.

“People like to buy into BHAGs: big, hairy, audacious goals” Aikins says.

“They want something great, lofty, inspirational.”

“When what you need is a powerful case well articulated constituency and leadership. It’s hard to raise money without those three things.”