“How much is enough?” is a question we often hear asked about personal wealth. I have heard it very few times asked about foundation assets. The assumption seems to be the accumulation of assets is a good thing and that will only mean more to give.  Now and then I will hear from a friend struggling with the growth of foundation assets. That’s the case in this recent letter.
“Dear Fred:
My critical issue and question at this moment in time is “How to deal with excess financial capacity without building a bigger barn.” The barn to which I speak is really two barns. One ‘barn’ houses our personal assets. The other ‘barn’ storehouses a considerable amount of charitable assets of our foundation. Both are as big as I feel are necessary. My dilemma is we have received an unanticipated generous distribution from the family business and I have no vision for it’s future use either personally or charitably. Normally, as in prior situations similar to this one, the lion’s share would go to our foundation (and taxes). But now that the foundation has already achieved a sufficient asset base it does not need to grow it any further. What appears to be the obvious solution to our dilemma ‘distribute it in grants’ is just as problematic as our current model of grant making–it is not capable of distributing this new infusion of cash in a wise, timely and responsible manner.”
His financial capacity has outgrown his vision and his model for making gifts. Years ago I met a man, Charles Graustein, who faced a similar situation. In fact we published his story in the newsletter. This is how he described the change and his response.
“It startled my sense of identity. Still I did not want to be mistaken for a two-legged ATM machine. So I set up an advisory panel to act as a sounding board and to widen the circle of conversation about our new capacity.
“The sudden increase in capacity though meant I had to make some changes personally and let go of some of the comfort of my previous identity that was built around my previous capacity. There was a sense of grief in that because I liked that level of giving and was not comfortable with this new level. I was afraid of making mistakes, of having to build a new identity in the community of attracting grants in a range for which I had no expertise. Change involves a certain amount of loss. I found a process developed by Daniel Yankelovich that helped me develop a sense of urgency about making the change. Otherwise I would have put off doing it thinking I would first get comfortable with it and then make the transition. I found I had to make the transition and then get comfortable with it. I had to find a level of trust with people and the future. I had to face the questions What is the best that could happen and what is the worst that could happen?
“The first step was my own awareness of the problem. My assets were going to grow faster than my current style of giving. The second step was creating a sense of urgency about responding to that. People around me that I trusted helped me make that change. The third step was jumping to a quick solution just to get back to equilibrium. Wrong move but almost an inevitable one. The fourth step was resistance from myself and others around me because none of us really wanted to  make the change. The resistance is real and it has to be brought out into the open and talked about. The fifth step was coming to grips with a number of options. There is no one right answer. The sixth step was willingness to put some weight down on one or two of the options. The seventh step was our full commitment to what we are currently doing. If the assets change dramatically again then we will have to go through the process again.”
What would you recommend for my friend if you were on his advisory panel? That’s not a rhetorical question because he would like to know what others think. Send me a note with your thoughts.
Fred Smith
The Gathering
601 Shelley Drive
Suite 201
Tyler Texas 75701
www.thegathering.com