Two Paths to Mega Gift Philanthropy

Two Paths to Mega Gift Philanthropy

In Marts & Lundy’s annual review of $10 million-plus gifts for the year 2020, we learned that while the number of gifts of that size decreased (187 in 2020 vs 251 in 2019) the total amount given by that smaller number of donors was larger ($17 billion vs $8.12 billion respectively). While there were many of the usual suspects in terms of donors and the recipients of those gifts, there were many newcomers to the list. The mission and achievements of Historically Black Colleges and Universities (HBCUs) gained much needed attention in the wake of a national discussion of racial equity and social justice. Several mega donors recognized the significant contributions that these institutions have had and continue to have on building a strong cadre of high achieving African American leaders to drive economic growth and diversify the nation’s decisionmakers across a broad spectrum of American life.

When looking at the gifts to HBCUs and other organizations, one observes two pathways toward this mega gift philanthropy. Most often there is the gift that comes from a long-term relationship between the donor and the institution they support. However, as philanthropists step in to help solve some of the most challenging societal issues we face, institutional engagement with the cause is proving to be a path to the same result.

 

Deep Institutional Engagement

Calvin and Tina Tyler are examples of long-term donor engagement. Calvin entered Morgan State as a first-year student in 1961. Before he could graduate, he was compelled to drop out because of finances, and he went to work as a UPS driver. Over the next 34 years, Calvin climbed the corporate ladder at UPS to become senior vice president of operations and, upon retirement, joined the company’s board of directors. Over the years, the Tyler’s remained engaged with Morgan’s mission. In 2002, they established an endowed scholarship fund to provide full tuition scholarships for need-based student aid. In 2016, the Tylers added $5 million to this fund – at that time, the largest gift in Morgan’s history. In February 2021, Morgan announced a $20 million gift from these very generous philanthropists.

Their gift, like many gifts of this size and purpose, comes after a long line of gifts where the institution has organized themselves to engage donors, effectively communicated their mission and ambitions over several years. These institutions have worked to demonstrate to their donors that their philanthropy has significant impact and have provided their donors with opportunities to see the impact of their gifts on the lives of the students funded by their scholarships. Trust has been built over the years and there is clear alignment between institutional mission and donor values. Morgan’s efforts are reflected in the words of Calvin Tyler, “We are trying to help young people succeed and this goal is aligned with Morgan’s mission; it’s such a perfect fit. We believe that Morgan State happens to be the best institution to use these resources.”

 

Broad Cause Engagement

Morgan State received an unsolicited gift of $40 million from philanthropist MacKenzie Scott – one of hundreds of gifts she made to HBCUs, the United Negro College Fund and the Thurgood Marshall College Fund, and other organizations totaling more than $4 billion. When examining MacKenzie’s gift to Morgan, experienced fundraisers might not view it as something they could replicate at their own institutions. How can we predict where the next MacKenzie-like gift will go? It was not a result of the traditional long-term engagement as was the case with the Tylers.

I am reminded of a statement from my colleague, Penelepe Hunt, in her recent blog on the topic of mega gifts. Penelepe wrote: “You never know who’s watching you.” MacKenzie clearly is deeply engaged in the cause to eliminate systematic inequities by investing in institutions that promote black leadership. But she chose those institutions not because of a personal connection or a case for support. Instead, she and her team of advisors evaluated organizations based on the clarity of their strategic plans, the health of their finances, proven leadership and the demonstrated ability to make effective use of the funding.

No doubt, the Tylers considered similar criteria when considering their support for Morgan. But what MacKenzie’s gifts have taught us is that an institution’s brand and the position it holds as a leader in solving some of the world’s greatest challenges can engage the passions of a donor who has never stepped foot on campus.

 

The Lessons Here Are Clear

Those organizations that are successful at attracting transformational gifts that extend the institution’s impact far beyond what it can do today need to remember the following:

  • Mega donors respond best to a big idea rooted in a clear strategic vision – one that aligns with the donor’s values and their ambitions for the institution’s ability to solve significant problems.
  • Donor confidence in the leadership matters and, in most cases, institutions have earned their trust, or the trust of experienced and informed advisors, which is built over an extended period of time.
  • Organizations must effectively communicate to their constituents and other thought leaders the effectiveness of their work in advancing the institution’s mission.

Ultimately, gifts at this level have reputational impact far beyond the financial and programmatic. That is certainly the case for Morgan.