Carmen Rojas and Daniel Gould FINAL – Transcript
Kirk Brown: [00:00:00] Welcome to Let’s Hear It.
Eric Brown: Let’s Hear It is a podcast for and about the field of foundation and non-profit communications, produced by its two co-hosts, Eric Brown and Kirk Brown. No relation.
Kirk Brown: Well said, Eric. And I’m Kirk.
Eric Brown: And I’m Eric. Let’s Hear It is sponsored by the Prebys Foundation, a foundation creating an inclusive, equitable, and dynamic future for all San Diegans.
Check out their amazingly good podcast, Stop and Talk, hosted by Grant Oliphant and Crystal Page. You can find them at stopandtalkpodcast.com.
Kirk Brown: You can find Let’s Hear It on any podcast subscription platform.
Eric Brown: You can find us online at letshearitcast.com.
Kirk Brown: And if you like the show, please, please, please rate us on Apple Podcasts so that more people can find us.
Let’s get onto the show.
Carmen Rojas: This is about one of my favorite
Kirk Brown: conversations we could ever possibly have on Let’s Hear It.
Eric Brown: I know, right?
Kirk Brown: You tell me what the conversation you think we’re about to have is- … and I’ll tell you the conversation I think we’re about to have.
Eric Brown: I think we’re gonna have a stupid conversation and I think it’s great, and you think we’re gonna have a good conversation and you think it’s great.
[00:01:00] Is that right?
Kirk Brown: I think it’s outstanding, and I think it’s about giving away money. And by money, I mean a lot of it.
Eric Brown: I mean actual money. A lot of it. Not fake money.
Kirk Brown: That’s right. Let’s talk about giving away lots and lots of money, and let’s talk about why what’s happening here is so interesting.
And then when we come back, I have a wrinkle to throw at you, because I think you’re taking this podcast in a very interesting direction, and I couldn’t be happier to be in the passenger seat for it. I’m just watching where you’re steering this, and I totally support it.
Eric Brown: Metaphorically speaking. Can one throw a wrinkle?
Kirk Brown: Let’s see. Let’s see, ’cause you’re about to throw, and there’s definitely wrinkling going on.
Eric Brown: As someone who knows a little bit about wrinkles- … I don’t know that I’ve ever had one thrown at me. I think they just emerge from, you know, whatever, wincing. I have a lot of wincing wrinkles.
Kirk Brown: Well, let me try this one on you.
Have we ever had more effective spokespeople on this podcast than Carmen and Dan?
Eric Brown: That would be rude to all of the other phenomenally effective people on the [00:02:00] podcast. So let’s not try and rank people. It just makes them feel bad.
Kirk Brown: What if they’re all equal in terms of great? ‘Cause this is outstanding.
This conversation, it’s really outstanding, and there’s some real technical stuff in the background here, but anyway, I’m getting too… Well, I’m doing the blah, blah, blah too soon.
Eric Brown: Should I mention who we’re talking to?
Kirk Brown: Yeah, let’s… Who are we talking to? What we’re talking about? Let’s bring everybody in.
Eric Brown: I spoke with Carmen Rojas, the president and CEO of the Marguerite Casey Foundation, and her colleague, Daniel Gould, who is the vice president for investments and operations. As you know, we talk all the time about foundations should spend out, spend down, spend, spend, spend. But there’s a person who has to do the spending-
and who has to make sure that there’s enough money there to do the spending and manage all that stuff, and money has to be liquid, and it’s not… It’s one thing to say you should spend. It’s another thing to figure out how to do it, and these two folks are on the same page. That’s what the conversation was about, and other stuff.
Kirk Brown: It’s wonderful. This is Carmen Rojas [00:03:00] and Dan Gould on Let’s Hear It. Let’s hear them talk about their experience, and then we’ll come back. There’s a lot to break down with this. This is Carmen and Dan from the Marguerite Casey Foundation on Let’s Hear It. We’ll listen in, and let’s come back.
Eric Brown: Last year, when the federal government started gutting funding for nonprofits, the Marguerite Casey Foundation didn’t issue a statement, they issued a check.
Actually, a lot of checks, increasing their grant-making from around $30 million to $130 million in a single year. It’s the kind of move that gets you named to Time magazine’s list of the 100 most influential people in philanthropy, which is exactly what happened to foundation president and CEO Carmen Rojas.
Now, Carmen and her foundation have topped themselves. Working with the foundation’s vice president of investments and operations, Daniel Gould, the Marguerite Casey Foundation just pledged half a billion dollars over the next decade, 50% more than they gave the decade before. And [00:04:00] Carmen said the part most foundation presidents never, never say, that the foundation’s mission matters more than the size of its endowment.
The Marguerite Casey Foundation is trying to set a new norm for what foundation giving should look like. I am thrilled to welcome to the show Carmen Rojas and Daniel Gould. Thank you so much for coming on Let’s Hear It.
Carmen Rojas: What an amazing intro, Eric. I feel like we should have you on every intro for anything that we do forever and ever.
Eric Brown: You can carry me around. You know what? I’ll be like your Natalie. Except good.
Daniel Gould: I love this. I love this.
Eric Brown: Well, okay. Every single word was true. That’s an added benefit of truth. You folks are doing incredible work, and I’m so excited to talk to you about it today. Thank you, thank you for coming on.
I don’t know, where do I start? Okay, Carmen, first I wanna congratulate you on being named to the TIME 100 in philanthropy.
Carmen Rojas: [00:05:00] Thank you. Appreciate it.
Eric Brown: Did it come with like a nice little piece of glass or something to put on the wall or…?
Carmen Rojas: It did not. What? But I did get… I know, I did get a lot of marketing from LinkedIn people-
saying that, “We will put it in glass for you.” Ooh. It came with a couple of really great things. One is amazing snacks. Oh, good. So the event- That’s a good start … was snackalicious- Nice … the whole event through. Number two, my family loves Marc Anthony, the salsa singer.
Eric Brown: Oh, yeah.
Carmen Rojas: And he is also a part of the TIME 100- Nice
for philanthropy, and I got a picture with him, and what I didn’t know is that he put the picture of me and a couple of colleagues on his Instagram. And the next day, my family, like it’s been like the most relatable thing that I’ve done since I’ve had this job. And number [00:06:00] three, and probably peak, is getting to meet Idris Elba.
Eric Brown: Ooh, okay.
Carmen Rojas: So yeah, definitely no plaque, but a lot of other good things.
Eric Brown: All right. And maybe what, a six-month subscription to TIME free?
Carmen Rojas: I also wish that was true.
Eric Brown: It was, oh, you get the week, you know, teaser deal. But so now your family says like, “I still don’t know what you do, but you met Marc Anthony and Idris Elba.”
Carmen Rojas: Marc Anthony, it must be good. It must be good. Yeah.
Eric Brown: All right. Let’s just dive right into this. The foundation announced that you would increase your grant-making by 50% for the next 10 years, and that you said that the duty to the foundation’s mission, shocker, is more important than growing the endowment.
Now, said in the open. You don’t hear that from a lot of foundation presidents. Honestly, going back, whoever’s foundation had the biggest endowment, they bought the lunch. So, like, that’s how we’re measuring ourselves. Are your foundation colleagues going to attempt an intervention- … on you for apostasy?
Carmen Rojas: What a good [00:07:00] question. I’m not sure. What I do know is that for us as an institution, this is a really proud moment for our board, for our staff. You know, this is a tremendous credit to Dan’s leadership in philanthropy. For somebody, as you know, who’s been following philanthropy for a long time, investment professionals in the sector are often the foil against duty to mission- Yeah
in particular, and that’s from Dan. You know? Dan brought that to us as an institution. I’ll say the genesis of this decision was really making this one-time $100 million commitment, and within a year, seeing that money actually make itself back. You know? Like, our endowment outperformed the way it should.
And being in conversations with many foundations across the country in 2025- Where people [00:08:00] were so afraid of two things. One, like reducing the size of their endowment, and two, whether or not increasing your payout would jeopardize the ability of the foundation to exist in perpetuity. That one snapshot of an experience for us was such an important sign of the more that we could and should be doing in a moment where, for us as an institution, we are being called to our mission.
Our mission is to support organizations, leaders, scholars, and initiatives that are shifting the power in our government. Right. So this is a mission moment for us, and with Dan’s leadership in the institution, we were able to make this kind of a long-term commitment.
Eric Brown: Well, Dan Gould, vice president of investments and operations.
So Carmen wrote a check that you gotta cash, in other words. That, you know, you committed the foundation to do something that makes your life much more interesting. Can you talk [00:09:00] to us about what it feels like to be the chief of investments at an organization that is now going to ramp up its payout and stay on mission and actually consider the question of perpetuity?
Now, what is your life like these days?
Daniel Gould: You know, Eric, first, thank you for this opportunity. Love any space to really share our work with Carmen, so I appreciate this opportunity. And to be frank, my day-to-day isn’t changing much. And I know it can seem in the spotlight of a $500 million announcement that there needs to be a significant institutional shakeup, but the process by which we arrived at this decision is consistent with how we’ll continue to manage the endowment going forward.
So we used all the traditional investment techniques you would use as an input into this decision. So our consultant modeled for us thousands of different market scenarios with Monte Carlo simulations. We did stress tests where we imagined another 2008 crisis and what that impact would [00:10:00] be on the portfolio.
We looked at the history of the organization. So, you know, Carmen gave a snapshot last year of us granting over $100 million, but we actually looked at what has been the endowment life cycles going back to the mid-2000s. Because a lot of times when you take an analysis like this, even when you look at a 2008 stress test, people forget that we had the longest bull market in history after that Great Recession.
And so that was the context with which we made this decision. And so frankly for us, it’s been less of a day-to-day investment management change and more of a mindset shift. It’s this conversation around perpetuity and fiduciary duty that we’re leaning into more now. We’ve done all the analysis, but what we need to do is actually participate in the conversation in our sector around fiduciary duty, not meaning grow your endowment to some indefinite, infinite number, but actually refocusing on the mission of the organization.
So [00:11:00] your duty is to deploy capital in service of the foundation’s mission, not to grow the endowment to some infinite number.
Eric Brown: So the Monte Carlo scenario, I always love it when they say that, which makes it sound like, you know, people are gonna take all the money and go to Monaco and bet it- … you know, at roulette, or they’re gonna buy an old, big old car from the ’80s and drive it around.
But this is just, you know, trying to figure out all the possible ways that the endowment could go up or down. And you ran all these fancy scenarios. Just wanna follow up with this, ’cause it’s so interesting to me. Most foundation endowments, their goal is to go up, which it feels to me like if your endowment is going up, you’re actually failing, because you’re not turning the money back into the community where it’s needed.
When you ran these scenarios, what did you see the endowment doing over time based on this much more aggressive payout scenario?
Daniel Gould: First with the Monte Carlo, I’m a comic book fan, so I’m a make an X-Men comparison here. So it’s kinda like the multiverse. So you run [00:12:00] these Monte Carlo simulations, and there’s different investment universes that could play out.
And so we looked at all these different universes, and what we were most comfortable with was the fact that Marguerite Casey Foundation will still exist 10 years from now if we give out $500 million plus, and that was, like, the anchoring moment for us in that analysis, which was, sure, there’s a multiverse where the endowment continues to grow and the markets continue to have performance that we couldn’t imagine.
There’s also a scenario where 2008 plus, there’s a worse market environment. Even in that environment, our scenario analysis show that the Marguerite Casey Foundation would still exist. And so then we just had to really get comfortable in that environment of, like, what kind of visibility does our finance department need?
You know, we’re a multi-year general operating support foundation, and so there’s visibility that our finance team needs, and so they were integral in this process. Our operations team has spent the last year plus with our [00:13:00] grant-making team reimagining our grants management system to prepare us for this announcement.
So, like I said, the Monte Carlo was a version of the X-Men multiverse, and it got us comfortable with a lot of different scenarios, and all of which actually then flowed through internally into how investments, operations, finance, and grant making partner together.
Eric Brown: Okay, Carmen, I wanna talk to you about this concept of 5%.
The norm in philanthropy. Now, we all know that foundations have to pay out 5%. That includes, of course, their operating-
Carmen Rojas: Yeah …
Eric Brown: expenses. So the actual payout is probably somewhere in the fours, if you’re lucky.
Carmen Rojas: Totally.
Eric Brown: So already-
Carmen Rojas: That’s not true for us. I’ll just stop you there- Good … just as a snapshot, like, one of our commitments I love that you said, I feel like Dan must feel like this all the time.
Like, I write the check and Dan has to cash it. But that relationship requires a lot of trust and alignment, and one of the places, one of the many places [00:14:00] where Dan and I are extremely aligned, is getting super clear on limiting our operating expenses and actually communicating that to the board. So like, we are now under 20 staff to move this amount of money.
We were under 20 staff to move $130 million. In philanthropy, that is unheard of.
Daniel Gould: Yeah. Right.
Carmen Rojas: There’s a notion that you need a lot more people. You need a building, you need a this, you need a that to do the job. At Marguerite Casey, we have really prioritized moving money into the field, not at our expense, but in alignment with what we need to actually run an organization honestly.
Eric Brown: That’s really cool. Totally cool. Yes, you’ve seen these $5 million endowed foundations with 10 staff, and you go, “Wait a minute.”
Carmen Rojas: Yeah.
Eric Brown: What’s going on here? So- Yeah … so you’re operating very leanly, which is amazing. But still, when the rules were promulgated that says that foundations have to put out at least 5% of their endowment, figured out [00:15:00] by some complicated set of formulas, and that became the ceiling.
So foundations are paying out 5% and not a penny more these days. But you’re- Yeah … you’re actually just taking all of that and tossing it away. How did this 5% thing become the ceiling and not the floor?
Carmen Rojas: I think that there are a couple of inputs. One is the one that you described, this fundamental belief that bigger is better.
Eric Brown: Mm-hmm.
Carmen Rojas: That you need to have and keep the most money in order to have the most impact, and that’s just not been true in philanthropy, you know? A book came out last year, The Radical Fund, and is a small foundation that had lasting generational impacts, right? It’s a million-dollar gift at the turn of the century that, in its commitment to move money out, really transformed American society as the genesis of the civil rights movement, of the labor movement in this country, came out of this smaller institution.
So one is, I think, a belief that [00:16:00] having the most money makes you the most impactful institution. I think the second is a confusion of fiduciary duty.
Eric Brown: Hmm.
Carmen Rojas: I think it’s been in people’s mind, a duty to protect the perpetual infinite growth of the foundation. The most striking questions that I got when we increased our payout last year were these questions about how do you stay as big and grow forever and ever?
And I was like, “Well, that’s not…” I didn’t think that was a norm, and Dan and I were at a board meeting after a meeting with a number of foundations about this, and I was like, “What is the implied commitment that we’re making as a charitable institution if all we’re doing is trying to grow more as opposed to give out more?”
And then I think third, I think, like, our sector philanthropy just has a bunch of [00:17:00] disincentives to give out more money. We don’t need to, you know? And so until we are either compelled to by force or by function, you know, by commitment to mission, then we won’t do it. And it felt really important to me, the case that both Dan and I made to the board at the end of last year, is that we wanna be an organization that’s in deep alignment with our mission.
Communities across this country are suffering. They’re being targeted by the government. They are not living a good life because of the government. They’re living a good life in spite of the government, and we want our government to be a force for good, for the good life and wellbeing for all of us. So this is our moment to really literally double down on that commitment, and it was a compelling argument to the board.
Eric Brown: We’re gonna take a very quick break, but we’ll get back and have a conversation about what those [00:18:00] conversations were like, and lots more right after this break.
Kirk Brown: You’re listening to Let’s
Eric Brown: Hear It, a podcast about foundation and nonprofit communications hosted by Eric Brown and Kirk Brown. If you’re enjoying this episode, you may just be a rule breaker.
Check out season three of Break Fake Rules with Glen Galaich, CEO of the Stupski Foundation, as he chats with inspiring leaders in philanthropy, government, media, and more about breaking the fake rules that don’t work so that we can build a future that does. Check them out wherever you get your podcasts.
And now, back to the show.
And we are back with Dan Gould and Carmen Rojas of the Marguerite Casey Foundation. We were just talking about the kind of conversations that you have to have with the board. Maybe I’ll turn it to you, Dan. As the investment guy, clearly you had these conversations about what this would do to the endowment and how you would manage it, and what this would do probably to the field and your brethren and sistren in the investment world.
What were those conversations with the board like?
Daniel Gould: [00:19:00] With the board and with my peers, they both went better than expected. And I will say with my peers, what’s been really exciting is that people wanna learn more about the first question you asked me, what are the inputs that were necessary to arrive at this decision?
And the fun part about sharing it back is, like, you all are already doing this in your finance and investment committee meetings, but you just have to change the framing a little bit in those conversations. And from that, I think I wanna call out one of our colleagues at Gary Community Ventures, because they published a really amazing report called Impermanence in Philanthropy: The Case for Giving Urgently, and they explore non-perpetuity based models for impact.
And what was validating from my perspective is that we had colleagues that were asking the same questions we’re asking around perpetuity, and one of the most powerful framings in their report is just that the perpetuity framework can actually lead a foundation to [00:20:00] follow a path that becomes a liability and not a safeguard of the institution.
Because you prioritize institutional survival over actually mission acceleration. And they gave this investment language, that the compound growth in the endowment means that the problems of the community are compounding at the same time. And it’s just a really powerful framework, and so I wanna give them credit because it’s great to see our peers following the same path, asking the same questions.
And so hopefully we’re gonna continue to see more of these discussions in philanthropy that isn’t a traditional investment conversation. What are your returns looking like? What are you investing in today? And it’s actually, how much are you giving and where are you directing those funds? And having that conversation more frequently in the sector.
So it’s been a great response, and the board is, like Carmen said, had our back from the moment where we really started this conversation, and it wasn’t a conversation that was new to the board. In 2022, we elevated our spending [00:21:00] as well in a year where the market was down, and so we had tested in 2022, in 2025, what would it take for us as an institution to give more?
So we were ready to go when we made this announcement.
Eric Brown: That’s such an interesting, whatever you wanna call it, a reframing around compound interest. Because if you think about compound interest in terms of the benefit to the community, an investment now compounds itself over time as well. Yep. Yeah.
It’s not just about dollars, it’s about the good that you can do and the ways that you can transform community. And obviously we’ve heard about so-called impact investing over the years, and it’s gaining currency, and some of the large institutions, the ocean liner institutions and their institutional investment teams are saying, “You have to invest for a total return, and then you’ll take the little bits of it and put that back into the community.”
And you and others are putting the lie to that. Dan, can you give me the 30-second pitch for some of these large institutional investors who don’t understand how you can actually return the kind of returns you [00:22:00] need and still provide the kind of support in ways that supports the foundation’s entire mission?
Daniel Gould: 30-second pitch, misalignment is 100% financial resource conversation, not a 5%, and the 95% operates in a silo. Building blocks. First, be very clear about what you don’t wanna own. No matter the size of your institution, you can be very clear about what you’re willing to own in your endowment and what you’re willing to not own.
The second thing is define your impact. There’s a lot of great impact managers that believe they can generate a market-level return and can have a social impact within the community. Ask your consultant to identify those managers and have conversations with those managers. You’ll learn a lot about the communities they serve, and I think you’ll actually find that their impact thesis is pretty solid.
And so I think that’s the second component. And then lastly, which is a story that takes more than 30 seconds, the US industry [00:23:00] manages $70 trillion plus of assets, and less than 2% of those assets reach women and people of color-led investment managers. Wow. And so that’s an opportunity that philanthropy in particular with our resources should be able to remedy in a meaningful way.
We’re never gonna close that gap, but 2% is unacceptable in an industry that’s a $70 trillion industry. And a lot of times those managers come from the same communities you’re serving, and are redirecting those resources back to those communities. So you can change the material economic circumstances of a community through your endowment portfolio- Right
while supporting your grant-making in the way we do around community organizing that’s working to transform government. But we can also hopefully increase civic engagement by improving the material economic lives of folks as well.
Eric Brown: Well, this is almost like the answer to me for the Center for Effective Philanthropy’s recent set of studies-
about this connection or disconnection between foundations [00:24:00] and their grantees. And to me, that study was like a kaboom. It was a depth charge for philanthropy because it really did call the question about what is a foundation supposed to do, and how is it supposed to partner with its grantees, and the idea that there’s this deep disconnect.
We are at a pivotal moment in philanthropy. So Carmen, what kind of conversations are you having with your foundation colleagues about how they read those research products, what they’re doing about it? Like, what is it doing to the industry? Is it getting noticed the way I think it should and probably you think it should?
What was the reaction?
Carmen Rojas: I’ll talk about my own reaction, which was not one of surprise. For the last two years, we have seen really of all major institutions, including philanthropy, kind of a stance of self-preservation. And at the expense of [00:25:00] the people and organizations we are meant to sustain and serve.
And for the most part, I haven’t seen people change their behavior. Frankly, like, I’ve seen people and philanthropic institutions kind of take on worse behavior, more extreme application processes, more extreme legal review, more extreme, more time for less money to organizations that just six years ago, after the murder of George Floyd, foundations were champing at the bit to get money to.
Today, they are having an impossible time getting call backs from these same exact institutions. And so the recent memory of 2020 to today, I can imagine being the leader of a racial justice or economic justice or environmental justice organization and feeling wild [00:26:00] whiplash in this political moment in which the political threat from our government is so high, and the same leaders that just six years ago said that they would have your back are nowhere to be found.
I would say that has been really, from our grant recipients, the most consistent reflection that they have about this moment. You know, Eric, I know you through Glen and Break Fake Rules. There are some foundation leaders that are actively working to break the fake rules. But folks oftentimes at smaller institutions in place with a depth of commitment to a community, folks like the Walter and Elise Haas
Fund is an amazing example. Steelcase Foundation just doubled their payout this year. Glen is doing spend down. There are leaders in philanthropy [00:27:00] who I, you know, treat as fireflies, like these magical beings that are emitting a light of possibility out into the world, and that’s who I am most interested in.
And I am so grateful for the Center for Effective Philanthropy’s report because sometimes we can delude ourselves that in protecting my own self, I am protecting us. Organizations are gonna continue to do this work with or without philanthropic resources. That is the story of history time immemorial, especially in this country.
Philanthropy has never been at the front end of funding the most radical approaches to making sure that everybody is free, to making sure everybody is housed, to making sure that everybody is well. And I am really grateful to be in community with a set of foundation leaders who are committed to that kind of a vision of our country.
Eric Brown: There are some very large foundations out [00:28:00] there who went all in on all the stuff that we’ve been talking about, and then pulled the rug out almost completely, which is astonishing, and it makes me feel like large philanthropy is working itself into irrelevance almost. And it is my fervent hope that the sound of our voices reaches some of those places in which they say, “You know what?
They may be right. We actually do have a responsibility to the people that we have identified as wanting to serve.” Yeah. And that we do run the risk of becoming irrelevant and not being able to do the work that we do, and that these small organizations, you’re not that small, but compared to these huge institutions, you’re much smaller.
Yeah. Maybe that is the source of the enthusiasm, the ideas. You’re able to make this case that you can invest in a community, you can use 100% of your endowment and make a greater difference than just using the 5%. Just in the few minutes that we have left, first I guess I’ll talk to you, Dan, and say in the investment class, like you said, the folks at the FFOG meeting and stuff like that, how many of those [00:29:00] folks are kinda coming up to you very quietly, like, “I really wish I could do that”?
And how many people just think that you are nuts?
Daniel Gould: I have less “you are nuts” responses, I will say. But there is a quiet momentum around how do we have these conversations with our board and with our investment consultants. And so I think it’s a very open conversation to have, particularly with your consultant.
One of the things that I think it’s important to understand when you’re working with a consultant, one, they’re obviously paid based on assets under management, so there is an incentive for your endowment to grow. But there’s also the structure of how endowments are built is important. So most consultants say, “Okay, we’re gonna start with the 5% required IRS minimum.
We will add an expectation for inflation. Here’s our fee, and then that’s your target of the return you should wanna generate every year. And then that dictates how you invest, where you invest, and that’s a great input into building your Monte [00:30:00] Carlo simulations like we talked about and imagining these different multiverses.
But that’s actually from the board perspective and from the internal leadership perspective, not the right framing. Those are the inputs into the math. As Carmen would say, there’s a math component to what we do, and there’s a mission component. And so a lot of the whisper I’m hearing is like, I need to talk more about the mission.
How do you all talk about the mission in these investment committee meetings, in these board meetings? And that’s where a leader like Carmen really shines, because she gives me the space with our board to go out into the world, into different places like FFOG in the past and Confluence Philanthropy, to actually share our story.
That’s a combination of this is the mission, this is how we do community organizing, and being fluent in that language, and here’s the investment side of our work, and here’s actually how we build portfolios, and it’s math plus mission.
Eric Brown: Carmen, in the seconds that we have left, what do you think it’s gonna take to make your approach, and this is, oh, [00:31:00] such a dream team, the two of you.
It’s so cool to see these two parts of a foundation being so in sync, so I just have to tell you, I’m really blown away. But what do you think, Carmen, it’s gonna take for this approach to become the norm in philanthropy instead of the exception?
Carmen Rojas: We know that when people come together and organize and demand that things change, that oftentimes it works, right?
Our history tells us that. What is the saying? Power concedes nothing without a demand. And our sector and our partners, our grant recipients, need to demand this of us, and we have to demand it of each other as institutions. I am most excited to partner with those institutions who aren’t interested in growing their endowments infinitely, perpetually.
I am more interested in partnering with those institutions who see a problem, know that they have a resource, and move quickly to get those [00:32:00] resources into the hands of the community that needs it. And so I think it’s more demands of our sector to do it.
Eric Brown: Well, Carmen Rojas, Dan Gould, you are heroes to many, and-
extraordinary at what you do. I’m just so inspired by what you’re doing. And I guess maybe for the foundation executive out there, like here’s an opportunity to hang with Idris Elba and get onto Marc Anthony’s- … Instagram feed. Do better. Thank you both so much for coming on Let’s Hear It. I can’t wait to buy you both a drink someday.
Daniel Gould: Thanks so much for having us. Thank you, Eric, for having us.
Kirk Brown: Okay, we’re back. So can we just start with, um… Well, okay. Uh, here’s the r- here… No, wait. Uh, let’s start with the wrinkle.
Eric Brown: Take your time,
Kirk Brown: Kirk. Let’s start with the wrinkle. Let’s start with the wrinkle. We’ve become, and I’m totally game for it, a podcast that talks a lot about how foundations should spend their money.
And this is such an important and timely subject because here I am listening to you have this [00:33:00] conversation, and I’m thinking about the Marguerite Casey Foundation deciding when everybody else was pulling back, they were gonna lean in and do more, and they were gonna deliver $100 million to the field at a crucially important time.
Eric Brown: 100 million more-
Kirk Brown: More than they had ever done …
Eric Brown: than they were already giving.
Kirk Brown: Correct. And that’s not even the more recent conversation that we’re gonna talk about in a second. Right. But this notion of this group deciding, “Hey, we’re gonna lead the way to do something different, do it better, do it at a time when the organizations that we serve are suffering.”
And our mission, and see, this is the wrinkle, this is the directional piece here.
Eric Brown: Oh, the wrinkle that you’re throwing? The thrown wrinkle?
Kirk Brown: Because what has been discussed here is that our mission is not to grow our endowment. Our mission is to actually support the organizations and communities that we serve and care about.
Eric Brown: Right.
Kirk Brown: And we have to do that by making different decisions about how we use the money.
Eric Brown: Right.
Kirk Brown: So that discussion is so, pun intended, rich.
Eric Brown: Uh-huh.
Kirk Brown: And I can’t imagine better people to lead that [00:34:00] conversation than Carmen and Dan, who are doing it so well, so thoughtfully, and obviously with great impact given the scale of the resources we’re talking about.
But $100 million and everybody else is pulling back, and Marguerite Casey says, “No, we’re actually gonna do more. We’re gonna come in here and do more.”
Eric Brown: Here’s an interesting thing, and I know you have it in your notes, you’re gonna ask me, and it’s like, ooh, you said this thing that I was gonna ask you a question about, so I’m going to anticipate the question, which is-
Kirk Brown: This is cheating.
Eric Brown: All right.
Kirk Brown: It’s cheating. You’re
Eric Brown: cheating. Right. You talk about growing the endowment. Most foundations- Right … they wanna get bigger. And as I think I might have mentioned, that in the old days, sit around the dinner restaurant thing, and the guy or woman who works at the foundation with the largest endowment, they pick up the dinner.
So we’re already measuring ourselves against each other.
Eric Brown: Yeah.
Eric Brown: And that’s crazy. The idea that you grow your endowment and you use compound interest and all that other stuff to grow your endowment-
Kirk Brown: Yeah …
Eric Brown: is compared against using compound interest to grow your benefit.
Kirk Brown: Yeah. I loved how you talked about that.
Eric Brown: Which is the earlier you put [00:35:00] the money into the work in the community or in the wherever, the more it has a chance to grow, the benefit grows. People say impact. I don’t like impact. I like benefit because benefit sounds good and impact could hurt. So you want compound benefit. So that is- Yeah
an investment in the stuff that you’re trying to do. Yeah. The opportunities you’re trying to take advantage of, the problems you’re trying to address. So that is a mental framework that I believe needs a lot more- conversation about we have to get it into our brains. We have to remap our brains, that you invest in the benefit so that the benefit will grow, rather than putting away your money so that you have more of it for some later date so that you can spend 5% of it each year.
You dribble it out and hope that you’re gonna do anything at all with that
Kirk Brown: Well, and there’s so much to think about there. And first of all, I think about Dan and Carmen and being the person who walks into Carmen’s office and says, [00:36:00] “Hey, I’ve got some thoughts about how we could, like, substantially put more dollars into the field.”
And it makes me wonder for most foundations, who holds that responsibility? Because the idea that once the institution is created, everyone thinks in terms of this institutional rubric where fidelity to the institution itself is actually the first thing you should be thinking about. Like, fiduciary responsibility means, okay, well, we know we’re being responsible if our endowment is growing every year.
That seems like such a plausible, obvious place to land, and yet Carmen and Dan are pointing out, you know, actually, that turns all this upside down then if you’re doing that.
Eric Brown: Right.
Kirk Brown: You’re totally changing the game. And honestly, having been around all these philanthropies, having seen all this work, having been funded myself and seen others being funded, I’ve never thought about this part of it, and it’s come up in our more recent conversations.
If you’re telling us that this 5% payout has become your ceiling and not the floor, that means that 95% of what you do is not actually central to the mission. That’s right. And re-educating the entire field around that [00:37:00] sensibility, is that even possible, and who’s got the responsibility for doing it?
Because clearly Carmen and Dan could be the messengers, and already are doing this work, by virtue of coming on our podcast and going other places. They’re the ones who can actually start pushing this message far and wide.
Eric Brown: It’s even more than that, I would say, which is that, okay, fine. The 95% is sitting there.
Maybe it’s doing nothing. Maybe it’s doing harm because you’re investing in companies that are serving at cross-purposes to the people that you are supposed to be- Right … helping. So there’s that. Yeah. Or maybe it’s just sitting there in some kind of, whatever, benign investments. So you could use that 95% for good.
You could use it to invest in organizations. You could use it to defray the costs of grantees in terms of things like helping them buy a place where they can ensure that they won’t get kicked out. The Rainin Foundation has been doing that with arts organizations. The Prebys Foundation, yes, they are a funder of ours, or a sponsor, but that doesn’t mean that they’re not doing [00:38:00] good stuff.
The Prebys Foundation is using their endowment to invest in real estate in downtown San Diego that would otherwise go empty or in ways to revitalize the city. So there are lots of uses for your assets. And it’s true, they may not get the same kind of return as if they put it in a hedge fund,
but at the same time, that money is actually working, and it’s helping people, and it’s advancing the organization’s mission. So even if you were just to pay out 5%, take that 95% and do something good with it. That’s an option. And then, of course, there’s just spend the damn money ’cause it’s there and it’s needed.
So maybe you should just consider that for a minute.
Kirk Brown: How much of this boils down to just the personalities of the people play? Because you listen to Carmen and Dan talk about this. These are clearly incredibly collaborative people, super smart, have thought this through. I really appreciated how Dan, your Monte Carlo simulations conversation, we’ve looked at the 10,000 different versions-
different ways this can [00:39:00] go. We did. And guess what? We’re standing regardless. Think about that. Yeah. You know, it’s like the upside down of your retirement planning. It’s like no matter what happens, we’ll be here. But how much of this really boils down to the willingness of these two leadership people to put their personal credibility on the line for saying, “Hey, I wanna direct a conversation that says our mission is about getting money out into the field, not the money that we’re holding in abeyance on this side of things”?
Because the clarity with which they could speak about this, their familiarity with each other, their willingness to talk with you, it just seems so clear that they have the right personalities to be thinking about this way.
Eric Brown: Yes. Any movement will require leadership, and with any luck at all, that leadership effectuates a culture shift.
Yeah. And we are not yet there in the culture shift, but the leaders who are pushing for this culture shift are doing it really well. Again, we’ve been talking about philanthropy and how it should operate and all this other stuff, and we claim to be a communications show.
Kirk Brown: Right. This is the side light you’ve taken us down.
No, no. This is our side hustle. What we are- Our side hustle has turned into [00:40:00] philanthropic-
Eric Brown: What we are doing is- … best
Kirk Brown: practices …
Eric Brown: demonstrating good communications is a- At least this is my fervent hope. That to create a culture shift- There you go … you have to communicate well. And-
Kirk Brown: Yes.
Eric Brown: Correct … we are highlighting the kinds of people who do.
Glen Galaich and Carmen and Dan and the folks over at Center for Effective Philanthropy. This is the culture shift that obviously we’re hoping to encourage, but that- Yeah … you know, like what we do is, you know, a fly on an elephant’s ass. It’s Glen and it’s Carmen and Dan and Elisha Smith Arrillaga, and those folks who are actually the leaders.
Yeah. Right. And they’re bringing people along. Yeah. And I think that that’s how you take a movement and you turn it into a culture shift.
Kirk Brown: And there’s a show don’t tell part of this too, right? Because I- Yeah … the thing I liked about what Carmen was talking about- So they had more recently stepped up with $100 million in addition when organizations started suffering as the political winds changed and folks were really struggling.
They said, “Hey, this is our moment.” They’ve doubled down on that now with a $500 million commitment over the next 10 years that’s substantially [00:41:00] greater than what they would typically be doing. And to make that possible, I thought this was so interesting, Carmen not only had to do the fiduciary part, work with the trustees, you know, Dan ran all of those scenarios.
And again, to be able to say, “Yeah, we’re gonna push another $500 million out the door, but guess what? Even in the worst-case scenario, we’ll still be here.” Right. You know, so we can do this and not do irreparable damage. But they also have to make that work institutionally, and the way you do that is you get your operating expenses under control.
Right. And so they talked about pushing dollars out with fewer staff. And the thing that struck me there, because I think it was Carmen who mentioned in passing, not only are organizations struggling to find resources because, you know, they used to receive all these dollars and now people won’t even call them back, but they’re being asked to jump through ever more onerous hoops to get the resources that are available to them.
And this piece about keeping your operating expenses under control, one of the things that struck me there is that to make this work, to be able to give that much more money away with this relatively speaking few staff, we need to have processes that are extremely efficient, both internally and externally.
You know, so we’re not only gonna just move more money [00:42:00] out the door, but we’re actually gonna make all this work so much better so that it doesn’t become this onerous, horrible process. Like, so there’s that implication of trust-based philanthropy, I feel like. It’s like I pick up a hint of that, you know, as this conversation goes forward, too.
Eric Brown: Yes. Well, there are ways to hide your operating expenses, and there are ways to hide your operating expenses. Yeah. And I’m not saying they do this, but I’m saying the danger is that you could reduce your staff to very few and make the grantees do all that work that you would’ve done.
Kirk Brown: Ah. Mm-hmm.
Eric Brown: And so you just push it out and say, “Hey, look, we’re at 5% operating expenses,” and that’s not fair either. So you have to do it with fidelity. And the way you do that is long-term general support, reduced burden of reporting, that kind of stuff that doesn’t push the onus onto the grantee ’cause that’s, you know, not fair, and it’s not consistent with what you’re trying to achieve with your low- Yeah
operating expenses. So you wanna make sure that you see behind the [00:43:00] curtain to make sure that they’re doing it right.
Kirk Brown: How do you get trustees to believe this is prudent and smart? Because if I’m a foundation trustee I really think you’d have to work pretty hard to convince me that my first job wasn’t to make sure that this endowment that I’d been handed, I didn’t create, that this endowment is here and continues to grow over time.
Eric Brown: Well, it depends. It depends whether you inherited trustees who are thinking the old way- Yeah … or you recruited trustees who have a new way of thinking about what the foundation is supposed to be.
Kirk Brown: But if you’re recruiting trustees, then that means you’ve got a head of the foundation-
Eric Brown: Yes …
Kirk Brown: who’s leading that process, right?
Right?
Eric Brown: That’s correct. If you have the opportunity to bring in trustees, you do it under that concept, which is that we are not here to grow the endowment and to perpetuate our greater fabulousness. What we are here to do is to address challenges and take advantage of opportunities for people in the community who are trying to live a better life.
Yeah. And if we think about it [00:44:00] always in that way, then we will spend accordingly, we will invest accordingly, our processes will accord with that. That’s great. Now, if you have inherited some folks who have operated under some former regime in which the goal was stability of the institution, and you have to change their minds, you have to educate them, well, I guess one of the ways you do it is you keep talking-
the way you talk- Exactly … and hope you don’t get fired. And if you don’t, it’s like, okay, fine, I believe I have the agreement of my trustees and I’m gonna move forward. So I don’t know. Yeah, yeah. You educate them, you build relationships, and you try to shift the culture so that there is external pressure for you to do better.
Kirk Brown: Along those lines, what do you think about organizations like the Center for Effective Philanthropy in this regard? You know, because it seems like those are the folks that have the capacity, and it seems like institutions like that could actually help facilitate this conversation almost more longitudinally in a way.
How many trustees that you interview would say, you know, what would they say their top three priorities are on behalf of the foundations they serve? You know, and where does eliminating or spending down our endowment, [00:45:00] where does that land- Right … on that list?
Eric Brown: Yeah. Why do you wanna work yourself out of a job?
Kirk Brown: Right.
Eric Brown: Again, back to your question, needless to say, organizations like Center for Effective Philanthropy are amazing and fabulous because they put a number on the zeitgeist. Which is that grantees feel that the foundations are disconnected. They report that they have to spend more time on paperwork.
They report that it is difficult to get a call returned. They report that they have onerous application things. So these are the kinds of things that we need. We need some level of semi-objective research that will allow us to go back to our trustees and say, “Hey, look, we are not serving the mission of the institution if the mission is to do better, is to help make the world a better place,” however you wanna define it.
And so organizations like that are really, really helpful. And again, they are helping to tell the story. It’s not just data. They interpret that data in ways that people can understand and acknowledge that, again, if we want to do the thing that the foundation was nominally [00:46:00] established to do, this isn’t cutting it.
Kirk Brown: Yeah. So as you were talking, this little nugget gets slipped in, and I can’t resist spotlighting it even though it’s not the centerpiece necessarily of what’s here. But, you know, so in-
Eric Brown: Fine, spotlight
Kirk Brown: the nugget … in 2020, George Floyd is murdered, and an avalanche of resources come out to support organizations providing social justice, equity support, community support.
And roll the tape forward, it’s 2026. I believe that’s six years. Believe that’s six years. So it’s not 100 years. Math is excellent. It’s not 50 years. It’s not even a decade. It’s six years. And Carmen and Dan are pointing out that some of those organizations, not only are they suffering and struggling because the dollars are drying up, but they can’t even get phone calls returned from the philanthropists- Right
that have been supporting them. And that little aside just landed so weightily for me. I would think about the kind of undercurrents of cynicism that we encounter at times when we think [00:47:00] about these big moments, and the reckonings, and the social support movements that we need- Right … to embrace, and then suddenly you look up, not even 10 years later, six years later, and so many of these foundations are pulling back because they’re just trying to survive this moment.
How do you put a jolt of, what is it, bravery? What do we need to draw on? So that was such an unfortunate thing to hear, because I can’t believe that the issues that were unresolved in 2020 had been solved by 2026. I just can’t believe it. Well, yeah. In fact, I don’t have to look that far and wide in the news feeds to suggest how badly they’re unsolved.
You know? So I don’t know. That was such a tough thing to hear.
Eric Brown: You have to ask yourself, if you’re going to go into a field or if you’re going to go deeper into something that you care about, and so a number of foundations determined that the effects of racism on all walks of American life were awful, and that they were going to go deeper, and they were gonna support diversity, they were going [00:48:00] to acknowledge how, particularly in the case of George Floyd, how Black communities have been targeted, and they’re going to invest in organizations in those communities so that we can begin to gain redress and try and make our society a better, fairer, less racist place.
Okay, so you’re gonna invest in that. And you have to ask yourself, “Am I willing to do this for a decade?”
Kirk Brown: Mm-hmm.
Eric Brown: “Am I willing to do this for two decades?”
Kirk Brown: Right.
Eric Brown: “Am I willing to do this for five decades?”
Kirk Brown: Right.
Eric Brown: And if the answer is no, don’t bother.
Kirk Brown: Hmm.
Eric Brown: Because the money will do more harm than good, and we saw what happened.
So you make a big investment in an organization or a set of organizations, they hire people, they, you know, move into a bigger office, they do all the things that you do in order to help to do the work, and then all of a sudden the rug gets pulled out and now they have what? They have to sell their place.
They go out of business. They merge with another organization that they may not necessarily be totally aligned with. They lay people off. It’s so damaging and- Yeah … and toxic, and it creates a bad [00:49:00] relationship anyway so that when the next funder comes in who actually genuinely wants to do that kind of work, the grantees are necessarily skeptical.
And, you know, you can hardly blame them. So you just have to be willing to be in it for the long haul, or else don’t bother.
Kirk Brown: Okay, but is this potentially the pushback to spending more aggressively then? Because what if the answer should be you need to be prepared to fund that work in perpetuity? Because let’s face it, this is a 100-year challenge.
This is a 200-year challenge. You know, it’s privilege to think that you’re gonna finish or resolve these things in a single lifetime. And again, I’m trying to put my fictitious trustee hat on. This is the moment in the conversation where I say, “Well, yeah, that’s exactly right. That’s why we spend exactly 4.5% of our endowment every year.”
Eric Brown: Well, think about it like a plant. Think about it like a houseplant. You think to yourself, “Okay, on the one hand, what is the least amount of water, fertilizer and sun I can give this plant- … that will allow it to not die?” [00:50:00] Or you think, “What do I need to do to get this plant to flourish, to get it strong enough to flourish?”
Yeah. And then once it’s strong and it’s flourishing, then, you know, we will seek out somebody else who has water and fertilizer- Yeah … and light. Or I will give this plant to somebody who can- Right … take care of it properly. Yeah.
Kirk Brown: Yeah. But,
Eric Brown: but I think what foundations are doing is they’re giving these organizations the least possible amount of money so that they don’t die.
Mm.
Kirk Brown: Yeah. Yeah. And,
Eric Brown: and how does that serve anybody’s purposes?
Kirk Brown: Right. Right. Right. Right. Well, and you know, another little nugget, not only is Marguerite Casey making this a substantial new investment commitment, but they just mentioned it in passing. They provide multi-year general operating support. Right. So it’s the best of the best.
So my answer to this whole question is what you need is you need Carmen, you need Dan. You need- All right … people. You need-
Eric Brown: And people like them. And other people- Yes … have to get like Carmen and
Kirk Brown: Dan. Yes. Yes.
Eric Brown: Because there’s only two of them.
Kirk Brown: Be like Carmen and Dan. There’s a lot of
Eric Brown: the others.
Kirk Brown: Be like Carmen and Dan.
We need more-
Eric Brown: Be more like… We have [00:51:00] buttons …
Kirk Brown: we need more Carmens and Dan, because the leadership quality here is so clear. It’s so clear. The willingness to do the work, do the assessment, do the analysis, understand the facts, understand how this all works, and then be able to bring it forward and say, “Hey, this is what we’re gonna do, and we will be here.
We will be here regardless of what happens 10 years from now, but we’re gonna make a substantial difference because this is our moment.” And let’s face it, it’s our moment. Go ahead.
Eric Brown: Yes. And they do this with joy.
Kirk Brown: Yes.
Eric Brown: They make it- Yes … they make it look fun.
Kirk Brown: Yes.
Eric Brown: Yes. If you do this-
Kirk Brown: Yes …
Eric Brown: it, it’s going to be a good experience.
Kirk Brown: Yes.
Eric Brown: Yes. Everybody’s going to like it. It’s gonna feel good. Totally. It’s gonna be- So inspiring … you know, you’ll enjoy your job.
Kirk Brown: So inspiring. Instead of
Eric Brown: thinking, “Ugh, how
Kirk Brown: am
Eric Brown: I gonna get through the day?”
Kirk Brown: No, it was like a breath of fresh air to hear both of them talk- Love ’em … about their work. They’re just outstanding.
Well, thank you so much, Eric. That was a great conversation. And Carmen and Dan, for everything you’re doing at the Marguerite Casey Foundation, everything you’re doing in the field, oh my gosh, I couldn’t be more grateful. But what do you think? Is there any more we have to say on this? This is incredible.
Eric Brown: Well, you’re welcome. I just do these for you.
Kirk Brown: You know [00:52:00] what? And I’m so overjoyed that I get to be part of it.
Eric Brown: Because I love you,
Kirk Brown: Kirk. I’m so overjoyed. I do
Eric Brown: it for you.
Kirk Brown: I appreciate it. I love you, too. Well, and we love all of you. So that was Carmen Rojas and Dan Gould from the Marguerite Casey Foundation.
Please check out their information on what they’re doing on their website. And we’ll be back with more, so thanks everybody. Thanks for another Let’s Hear It. Okay, everybody, that’s it for this episode. Please let us know if you have any thoughts about what you heard today or people we should have on this show, and that definitely includes yourself.
And we’d like to thank John Allee, the tuneful and inspiring composer of our theme music.
Eric Brown: Our sponsor, the Lumina Foundation.
Kirk Brown: And please check out Lumina’s terrific podcast, Today’s Students, Tomorrow’s Talent, and you can find that at luminafoundation.org.
Eric Brown: We certainly thank today’s guest, and of course, all of you.
Kirk Brown: And most importantly, thank you, Mr. Brown.
Eric Brown: Oh, no, no, no, no. Thank you, Mr. Brown.
Kirk Brown: Okay, everybody. Till next [00:53:00] time.