MacKenzie Scott: Look for a More Active Year After a Quiet 2023

Last year was in many ways unremarkable for MacKenzie Scott, one of the most closely watched philanthropists in America. After finalizing her divorce from her second husband in January, Scott kept a low profile. She awarded $2.1 billion in grants, her lowest total since she first captivated the nonprofit world in 2020 with her rare approach of providing large, unrestricted grants to charities that seldom receive gifts that big.

Scott, who received Amazon stock then worth $38 billion in a 2019 divorce from her first husband, Amazon founder Jeff Bezos, is famously private and used only 54 words to describe her 2023 giving.

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But signs point to a more active 2024 for Scott, who does not appear on the Chronicle’s Philanthropy 50 ranking because she doesn’t reveal how much she contributes to her donor-advised fund.

Scott sold about a quarter of her Amazon holdings last year, according to a January filing, which generated proceeds of roughly $10 billion. And while plenty of mystery continues to surround the process behind her giving, more clues may emerge as early as this month, when her first grants in response to a traditional application process are set to be announced.

That competition, overseen by Lever for Change, will award $1 million each to 250 “community-led” organizations with budgets of $1 million to $5 million. More than 6,000 groups have applied for the grants. For the past four years, Scott has relied heavily on the Bridgespan Group for help with her grant making. The open call run by Lever for Change is seen by many philanthropy observers as an answer to criticism that her grant making lacks transparency and overlooks some worthy organizations.

Scott has made grants totaling more than $16.5 billion since signing the Giving Pledge in 2019, when she wrote that she “would keep at it until the safe is empty.” But she made less progress on that goal in 2023 than in previous years, leading some philanthropy experts to wonder if Scott and her advisers are having trouble finding new groups to support.

“Maybe it’s caution — being careful and diligent,” says Patricia Illingworth, a professor at Northeastern University and the author of Giving Now: Accelerating Human Rights for All. “It’s not easy to keep spending the money.”

Brian Trelstad, a senior lecturer at Harvard Business School, says Scott’s 2023 sale of Amazon stock alone could allow her to create one of the country’s largest foundations.

“If she put in $10 billion, it would be a top-five U.S. foundation,” Trelstad says. “Or she could give $2 [billion] to $3 billion more each year over the next five years through the process she’s been using. My guess is that the latter is much more likely.”

Trelstad is collaborating with other Harvard researchers, including Matthew Lee of the university’s Kennedy School of Government, on a long-term study of how Scott’s gifts affect the finances of the recipients.

Lee says it will be interesting to see how the Lever for Change competition influences Scott’s giving style.

“She now has a process for accepting applications,” Lee says. “Moving forward, which channel will she use? Will she use the application process, or will she use the ‘inside out’ process that so far has accounted for most of her giving?”

The Harvard researchers found that health care has become a bigger priority for Scott. Health care organizations received the largest share of her giving in 2023, a far cry from 2020 and 2021, when her focus was on education and human-services groups.

One of the biggest beneficiaries of Scott’s giving in recent years has been Upstream, which works with health care providers to make contraception more affordable and accessible. It’s extremely unusual for Scott to make multiple gifts to the same charity, especially in back-to-back years, but Scott gave Upstream $30 million in 2022 and an additional $25 million last year.

The nine-year-old charity hopes to expand from working with 170 health centers this year to 700 centers — serving 5 million patients — by 2030.

“Her commitment to Upstream is really helping to catalyze our next chapter of impact and scale,” says Sarah Pierson, the charity’s chief development and external-affairs officer.

In 2023, Scott gave $9 million to the School-Based Health Alliance, which delivers training and technical assistance to help start health centers in schools.

Robert Boyd, the charity’s CEO, says the group greatly expanded its consulting business — and improved its finances — after an auditor warned around the time that he was hired in 2019 that the charity was too dependent on federal funds.

Upstream

Boyd says he used the $9 million Scott grant to increase salaries, provide professional-development opportunities for staff, and triple the charity’s reserves. The organization has about $2 million left from the grant, and Boyd says he’s identifying foundation partners that want to put their money alongside the charity’s own to get more “care coordinators” into schools.

“This Scott money gives you a whole different attitude,” Boyd says. “Before you were taking money from just about any source that you could. This gives you breathing room — it lets you pick and choose.”

A study released last November by the Center for Effective Philanthropy found that groups receiving Scott gifts generally reported experiencing few challenges or unintended negative consequences. But no other major philanthropist has adopted her approach, and the center’s report uncovered continued skepticism about her giving strategy. More than three-quarters of the grant makers interviewed by the center expressed concern about the ability of nonprofits to handle precisely what Scott is doling out — large, unrestricted gifts.

Many foundation program officers are no doubt in close contact with some of the charities receiving Scott’s gifts, which may indicate greater challenges exist than charities are willing to share publicly. But another read of the grant-maker skepticism is that it amounts to little more than sour grapes from people whose paychecks depend on a foundation model with a high level of staffing — a structure that Scott’s streamlined approach calls into question.

Jörg Carstensen, DPA, Newscom

“Scott’s giving does challenge at the broadest level the accepted and widespread model of foundation giving which has shaped philanthropy for the last 150 years,” says Elizabeth Dale, an associate professor of nonprofit leadership at Seattle University.

Dale points out that Scott’s gifts aren’t designed to support organizations indefinitely — and it will be interesting to see in the next few years if charities that expanded programs can sustain that work when Scott’s money has been spent.

“If other donors don’t follow behind Scott, we may see some organizations facing a bit of a cliff,” Dale says.

The Pride Foundation, in Seattle, received $3 million from Scott in late 2020 — just as the grassroots LGBTQ organizations the foundation supports in five Western states were being hammered by the pandemic. The Scott money allowed Pride to triple its annual grant making — from $500,000 to $1.5 million — and also helped the group attract other backers to make its increased support to frontline organizations sustainable.

Last year, Pride gave out $2.2 million, and it hopes to continue to increase its support by 10 to 20 percent a year, says Katie Carter, the foundation’s CEO.

“We don’t have a MacKenzie Scott gift waiting to be distributed, but we’ve had some incredible fundraising years,” Carter says. “We’re in a strong position to plan for a much longer cycle of projects.”