A Family Fund’s Response to the Racial Reckoning: Give All Its Assets to One Black-Focused Nonprofit

In a rare move for philanthropy, Adam Holofcener and his family emptied their foundation’s coffers and gave $1 million — nearly all the money it had left to give — to support Lisa Snowden-McCray’s dream: a free newspaper staffed by Black editors and writers in Baltimore to provide news primarily for the city’s Black residents.

Snowden-McCray, a journalist who worked at the city’s major daily, the Sun, and the now-shuttered alternative weekly, the Baltimore City Paper, knew Holofcener, a lawyer-activist who represented artists, from the progressive orbit they both inhabited.

She and Brandon Soderberg, a former Baltimore City paper editor, had tried to launch a new paper, the Baltimore Beat, but the publishing company that supported it pulled the plug. In 2020, Holofcener casually asked the two if they had any plans to resuscitate the publication.

After some more conversation, he surprised the two with an offer. The foundation, which he says had been making a “hodge-podge” of unfocused grants for decades, would essentially go out of business after giving the Beat $1 million.

“I knew he was a nice guy,” Snowden-McCray says. “I didn’t know he had access to a million dollars. The money was a complete shock to me.”

His family’s Lillian Holofcener Charitable Foundation joins a growing number of grant makers that have put time limits on their existence so they can direct more money immediately to charities.

Not only did the Holofcener foundation decide to give away just about every cent it had but Adam Holofcener, 36, executive director of Maryland Volunteer Lawyers for the Arts, and the other relatives on the board did something even more rare by dedicating almost all of its remaining assets to a single project.

For Holofcener, the bold move was both an attempt to directly respond to the calls for racial justice after the murder of George Floyd by police in 2020 and an attempt to purge the family of gains it had made, which, as Holofcener sees it, came at the expense of Baltimore’s Black residents.

Holofcener’s grandfather amassed his wealth first through his insurance businesses and then through a successful chain of skiing and golfing equipment stores. Decades ago, the Holofceners left Baltimore for the suburbs, like thousands of other white families, leaving the city with a depleted tax base that Holofcener says crippled its ability to provide adequate services for its residents.

The move is an attempt to counter the idea that “any giving is good giving,” Holofcener says. If the foundation, named after his grandmother, had distributed grants over several years to select nonprofits, the philanthropy would still maintain control over the city’s nonprofits competing for the funds. he says. A better way to give, he says, was for the foundation to give up control of how the money was used and leave those decisions to the Baltimore Beat staff.

“It was very important that not only were we giving all the money away but that we were losing the money,” he says. “It’s as important to disempower ourselves as it is to empower them.”

After the Protests

Holofcener wasn’t even in a position to decide how to spend the family’s remaining philanthropic assets when protests erupted after George Floyd’s murder in 2020. The sole board member, his uncle Rick, a serial entrepreneur, was halfway around the world, living with his family in Thailand. Adam spoke with his sister Ashley, who lives in Florida, and with Rick’s daughter Sydney, who lives in Tennessee.

As demonstrations continued into the summer, Ashley, now 33, felt a sense of helplessness. She, her husband, and her newborn daughter had decamped to Florida early in the pandemic. Feeling unrooted, she remembers breaking down in tears at the kitchen table one morning as she tried to process the killing of Floyd, Breonna Taylor, and all of the other instances of racial injustice being brought to light.

Discussions with her brother and 20-something cousin, Sydney, reminded her that through her family’s philanthropy, they could actually make a difference.

“Why can’t we strike while the iron is hot,” she says they told her. “There’s a real opportunity for us to engage.”

The problem was that none of the cousins actually had any say over how the family foundation doled out money. Rick had accepted that job years before, but he was not a hands-on philanthropist.

“I was not in that business,” he says.

The younger Holofceners found that their uncle was receptive to having them join the board. Rick seemed to welcome their involvement because while there were some differences, they each shared some basic left-leaning political views.

But Adam did want to push the board in a new direction. He introduced them to two books published in the previous five years: The Revolution Will Not Be Funded: Beyond the Nonprofit Industrial Complex, by the national activist organization Incite!, Women of Color Against Violence, and Decolonizing Wealth: Indigenous Wisdom to Heal Divides and Restore Balance, by Edgar Villanueva.

The reading, Rick says, was useful. Coming from a business background, the idea that a nonprofit could get a lump sum with no strings attached seemed counterintuitive. In the angel investing world of business start-ups, financing is staggered, with new rounds of cash coming as projects meet set milestones. Moreover, the notion that the Holofceners’ limited remaining assets should be steered toward a single nonprofit, rather than a group of organizations, seemed to go against the grain of basic business advice: Spread your resources out in a portfolio of investments.

“It was a little bit scary for me,” Rick Holofcener says.

Michael Theis, The Chronicle

The books seem to have helped get the family members on the same page, Adam says. While the broad practice of philanthropy has not changed a lot since their publication, the precepts in the books can lead to small modifications that serve as examples to others, he says. By discovering strands of shared experience among donors and grantees, philanthropists can begin to steer away from traditional thinking about getting a return on their donations and develop what he calls a “chain of empathy.”

In a negotiation, Holofcener says, it is unlikely that all of the participants will see eye-to-eye. But if each can identify with at least one other participant, everyone involved can come together with a shared purpose.

So when the Holofceners began to meet with the founders of the Baltimore Beat, it was evident that Rick, with his business background, sometimes didn’t seem to speak the same language of the Baltimore Beat editors, who were steeped in social-justice traditions. But he could identify with his niece Ashley, who had both an interest in addressing racism and the business acumen she developed as an account executive at the technology company Salesforce.

Ashley served as the “chain” linking Rick with her brother Adam, and Adam, who has both legal training and years of experience in Baltimore’s nonprofit sphere, served as a connector between the family and the Beat editors. Everyone along the chain of empathy, as Adam puts it, could feel comfortable with at least one other person involved.

The discussions, Ashley says, helped steer the family toward making a single, big gift.

They did consider another option: creating a community-led fund that would have spread out grants to a number of nonprofits each year. But by making a single, eyebrow-raising grant, the Holofceners thought they might draw the attention of other donors and encourage them to give. The Beat reports that it has raised an additional $250,000 since the Holofcener gift.

Coming to the decision meant the Holofceners had to reorient their notion of success, Ashley says. She hopes the Baltimore Beat publishes for many years to come. But if it doesn’t, the grant will have accomplished something important if it spurs other foundations to act boldly.

“A win in our minds is breaking the cycle of how foundations and philanthropic organizations are typically managed today, " she says.

No Longer the Default

The Holofceners’ decision to distribute everything to one organization is not the norm, but more family foundations are considering whether to give more — or even all — of their assets, says Nicholas Tedesco, president of the National Center for Family Philanthropy. Three years ago, when the center last checked, nearly half of the 2,000 foundations surveyed had a plan to operate in perpetuity. About 20 percent periodically discuss the issue. That finding, Tedesco says, illustrates that plans to continue grant making decades into the future isn’t necessarily the default for many foundations.

As new generations of family members increasingly populate foundation boards, Tedesco predicts more grant makers will begin to take a second look at how they give. Typically, he says, people who make a lot of money view it as a hard-earned asset and might resist giving up control over how charities use their grants. Their sons and daughters, however, are more likely to see their family’s money as a gift to pass along to others.

“Among the next generation of family philanthropy, we see more of willingness to embrace risk and to move away from a posture of waiting for guaranteed results,” he says.

Villanueva, the author of Decolonizing Wealth, says he is glad his book was useful to the Holofceners. He was not involved in the family’s decision, but he hopes more family foundations take notice. Through Liberated Capital, a membership group of donors he founded, Villanueva wants to raise $25 million for a reparations fund that will support social-change groups led by people of color. About half of the $4 million the fund has distributed so far came from gifts from older people. But he especially hopes that young people, who tend to be more attuned to racial and social justice than older generations, will fuel efforts to put more philanthropic capital into play in the future.

Since publication of his book in 2018, Villanueva notes that a few large grant makers have changed practices, including the Bush Foundation, in Minneapolis, . Also, the Bullitt Foundation, in 2019 decided to give away all of its assets and donate its Seattle headquarters to environmental nonprofits.

Family foundation boards can take many steps to cede power, but the Holofceners represent something close to the truest form of Villanueva’s vision. “There’s a lot we can do along that continuum, but liquidating assets and completely handing them over to community is the purest form of decolonizing wealth,” he says of the Holofcener grant.

Refining the Business Plan

In a letter from the editor published in the relaunched Beat’s inaugural edition in August, Snowden-McCray outlined the paper’s goals.

“We wanted to give Black writers the opportunities to tell their own stories,” she wrote. “We wanted to help add depth to the stories that are told about Baltimore. We wanted to make a paper that reflected the joys — the art created here, the celebrations held here, the lives lived here — and sadness of the city.”

Since then, the paper has published nine issues, and its coverage has included articles on how Baltimore’s prosecutors are sometimes no-shows at trials and on the large number of vacant houses in the city.

But before the Holofceners agreed to cede control over their assets and help Snowden-McCray with her mission, they wanted a sense of confidence that the paper would be managed well, say both the family members and Snowden-McCray. For instance, in 2020, when he saw the first draft of the paper’s business plan, Rick Holofcener said it lacked basic information about how the Baltimore Beat would attract revenue and didn’t properly account for all of the paper’s probable expenses.

Working for several months with Snowden-McCray and Soderberg, the paper’s co-founder, the family and the journalists fine-tuned their vision. The process, Soderberg says, was stress-free because they knew the money was coming; the time-out was simply to make sure the nonprofit paper would have a smooth rollout.

Snowden-McCray remembers the period before the grant became official as a “really good time.”

The foundation wasn’t laying out preconditions or must-dos. Instead, the pause gave the paper and the family time to thoroughly nail down their plans.

The paper developed a comprehensive strategy for where it should deploy newspaper boxes so they would reach people who would benefit the most. In their experience at the City Paper, newspaper boxes were mostly placed in areas of the city frequented by white people. They also decided that the boxes should also be manufactured in a way that allowed people to donate things like canned goods or hand warmers during the winter months.

The extra time also allowed the paper to plan fundraising events and to hire Black journalists. Leaders focused on hiring editors, then gave those staff members the opportunity to hire and train rising journalists of color in the city. To keep operating costs in line, the refined business plan also called for a biweekly paper instead of a weekly, as originally planned. As a result of the extended planning, Snowden-McCray is optimistic about the paper’s future.

“Everybody wants everything fast,” she says. “But I think slow cooking it will ultimately help us last.”