Kenneth Rainin, a businessman who died in 2007, gave a short list of directions for his daughter when he asked her to lead his namesake foundation. He wanted the grant maker to focus on the arts, education, and medical research, “but within those areas it would really be up to me to decide how we focus,” said Jennifer Rainin, now the CEO.
With latitude to shape the grant maker, Rainin decided to focus on inflammatory bowel disease, “which was a no-brainer” because various members of her family, including herself, have it. She also wanted the foundation to have a local impact, so it invests in children’s literacy programs in Oakland. As for the arts, the grant maker has supported independent filmmakers, dance programs, and theater. Its track record for movies includes award-winners like “Sorry to Bother You,” “Beasts of the Southern Wild,” and “Fruitvale Station.”
The foundation’s long list of grant making has led Rainin to think more about the foundation’s work as it approaches its 10th anniversary. What has she learned along the way that would help other grant makers? What does she wish she had known back then?
Rainin and other leaders from 14 foundations with at least $350 million in assets reflected on the earliest stages of their work in a new Center for Effective Philanthropy study intended to help leaders who are new to the world of big-time grant making. The study was qualitative so it gives answers to broad, open-ended questions.
The Leona M. and Harry B. Helmsley Charitable Trust provided funding for the research. The Kenneth Rainin Foundation was one of the 14 grant makers surveyed.
Be Humble; Limit Your Scope
Ellie Buteau, vice president for research at the Center for Effective Philanthropy, said the report is a useful guide for new grant makers because it shows how early challenges can become significant pitfalls.
In one example, a trustee cited in the study said an organization arrogantly assumed that becoming a grant maker would be easy because it requires business expertise. That trustee learned the hard way that philanthropy is harder than it looks.
“We lacked a level of humility in the beginning that’s not uncommon with new grant-making organizations,” the foundation leader said, adding that some grant makers fail to realize they are likely not the first donor in any niche. “When our organization fell for this common pitfall, it created all kinds of problems for a series of years where grantees were a combination of confused or annoyed.”
Rainin said one way to avoid this common trap is to hire consultants who have a wider understanding of philanthropy. She also recommends narrowing the focus to fewer areas to deepen the impact of their giving.
For example, the Rainin Foundation is interested in medical research, but its goal isn’t to fund every marquee medical program. Instead, it tries to “de-risk” tricky research areas by investing early. Rainin said even if the medical research it supports turns up inconclusive, at least others will know what doesn’t work and can invest accordingly.
Don’t Skip Communications
Buteau said many of the grant makers they interviewed regretted not hiring a communications expert when they first started funding projects. It’s common for new foundations with fewer staff members to have one person wear many hats, but treating communications as an afterthought was imprudent.
“Communications slid onto the back burner, and it shouldn’t have. We believed no comment was the best comment, but that harmed us a bit,” one trustee said.
Stephanie Cuskley, CEO at the Helmsley Charitable Trust, said a grant maker can enhance its impact by telling its stories to the public, which is something leaders “don’t know until they get into it.” She added that communication’s teams are most successful after the grant maker has determined what specific causes they’ll fund, which may take a few years to cement.
Rainin said her foundation didn’t immediately hire a communications person, wondering if it would be a full-time job, but when an employee stepped in to the fill the position, she realized how important it was to the foundation’s mission.
“Communications is the way to amplify the impact of everything you do,” she said. “It’s the lighter fluid.”
Practice Being a Good Grant Maker
One trustee said part of being a good grant maker is learning not to string potential grantees along during an application process. This can be difficult, the report says, using an example of one organization receiving more than 3,000 unsolicited grant requests in its first year despite having a invitation-only policy.
Nonetheless, leaders agreed that it’s a bigger mistake to allow nonprofits to invest time and energy in pursuing a grant that doesn’t have a chance. “Part of grant making is saying no, and inevitably, funders have to decline applicants,” researchers said.
Learning how to be a successful grant maker is difficult, so Cuskley encourages grant makers to reach out to other organizations for advice.
“What’s phenomenal about the foundation space is people want to help. Anytime I’ve ever cold-called anyone [for help], they always returned my call. That’s what foundation people do,” she said.
