The Expertise Behind the Grant: A Next-Gen Donor’s Argument for Leveraging New Profit’s Model
Though he has served as Executive Director of Arrow Impact since its inception, Charlie Wolfson didn’t start out in philanthropy. For much of his career he worked in K-12 public education, focused on school operations and finance. It wasn’t until his parents began discussing the possibility of launching a philanthropic foundation eight years ago that he considered how he might make an impact as a funder.
“There’s only so much you can do within the walls of a school,” he says, and he was intrigued by the idea of bringing his on-the-ground experience into philanthropy. Soon, Arrow Impact was off and running with grantmaking focused on creating pathways to economic prosperity.
Charlie sat down with us recently to share what he sees as some of the most valuable benefits of working with an intermediary like New Profit.
Charlie is part of a broad spectrum of what philanthropy often refers to as “next-gen funders,” which can encompass newer funders standing up new family offices, inheriting an existing one, or establishing a philanthropic enterprise after coming into new wealth. Next-gen funders are poised to transform the field: an estimated $18 trillion is expected to flow into charitable giving by 2048 as a result of the Great Wealth Transfer, in which older generations will pass funds to heirs or charity.
While Charlie established the framework and vision of Arrow Impact from scratch, working in partnership with his family, he’s still a relatively newer funder – and one of his first considerations was how to make the most of infrastructure that already existed in the field.
“There’s the old way of doing philanthropy, which was much more about creating a perpetual foundation, staffing it up, and doing most things in-house,” he says. “I just don’t feel like that’s what’s resonating with next-gen folks. While there is a lot of talent in many traditional foundations, there’s a bias among new funders toward wanting to act more nimbly and get dollars out more quickly and more impactfully, without getting slowed down by excessive bureaucracy.”
“I think intermediaries are a great channel for that. For those who want to use philanthropy to drive as much impact in the areas that they care most about, intermediaries allow you to leverage the people who are better positioned to help both identify and support the best leaders doing the work. Especially for newer funders, it’s a really great way to be able to learn from how others are approaching the work.”
Three ways Arrow Impact benefits from working with New Profit:
1) A rigorous selection process aimed at finding grantees poised to make systemic change
Charlie points to New Profit’s track record of finding “the right leaders,” informed by over 25 years of pattern recognition. Since 1998, New Profit has supported more than 300 social innovation organizations across the country, with 98% of grantees still active and supporting communities today. “There’s more weight put on understanding the leader and the leader’s vision, and what it would take to really achieve that vision,” he says. “As I got to better understand the way you all think about systemic change, it really informed how we think about it at Arrow Impact as well.”
2) Support beyond the dollars
New Profit’s model provides capital, community, and capacity to portfolio organizations. This can look like the peer support and mentorship provided by our year-round cohort model for Catalyze organizations, or the hands-on guidance of a Dedicated Partner paired with Build and Transform investments.
Charlie sees that level of strategic support and capacity building to be the hardest to replicate. “Having talked to so many New Profit grantees that have had a Dedicated Partner on their board, I’ve come to appreciate just how game-changing that’s been. It takes a lot of time, and a lot of effective matchmaking, to make sure you’re putting the Dedicated Partner with the right specialized knowledge, experience, and personality with each leader.”
3) Unlocking future funding for grantees
“A grant from New Profit is such an important stamp of approval for organizations that can be leveraged to secure additional funding or build other relationships,” Charlie says. “Another funder’s grant is not going to carry that same kind of weight and open the same doors.”
In addition to these benefits, Charlie reflected on the value of an evolving relationship with New Profit, from being able to connect with social entrepreneurs and other funders at events like The Well or through the New Profit community, to developing a shared pipeline.
“What started as a partnership where we were thinking about New Profit as a grantee has developed into what has felt like a really collaborative relationship,” Charlie reflected. He pointed to his experience with Propel America, whose model of providing pathways into medical professions for young people intrigued him. After seeing that the organization had been supported by New Profit, his team reached out to Abby Marquand, who led New Profit’s economic mobility team at the time and was able to share her perspective based on her work with the organization as well as her own background in the health care field. Soon after, Abby set up an initial meeting with Charlie’s team and Propel America’s leadership, eventually leading to a successful funding relationship.
As philanthropy evolves in the coming years, Charlie encourages other funders to consider how intermediaries can amplify their impact. “There’s going to be so much new philanthropic capital coming into the space,” he says. “Leveraging existing infrastructure, especially the growing set of effective intermediaries, is such low-hanging fruit.”
As for his advice to funders considering a partnership with New Profit? “Talk to New Profit grantees directly, both current and alumni,” Charlie says. “It’s one thing hearing it from New Profit, but hearing it from leaders who have benefited from the partnership is really valuable.”