Photo courtesy of Cultural Heritage Finance Alliance

Webinar, 4/21: Heritage-Led Regeneration as a Tool for Sustainable Development

FJC celebrates the release of partner organization The Cultural Heritage Finance Alliance (CHiFA)’s report Impact and Identity, Investing in Heritage for Sustainable Development.  The white paper makes the case for historic resources as investable assets for the comprehensive and sustainable revitalization of many at-risk and culturally significant communities throughout the world. Particularly timely, the report reflects on successful models to define a path forward that is an antidote to environmental degradation, civic erosion, the loss of irreplaceable cultural treasures and the displacement of local populations.

The report presents studies of six examples from across the world where heritage investment has restored vibrancy to historic urban centers that had been in economic and cultural decline.  A housing investment company in Amsterdam, a World Bank loan in Fez, a visionary private investor in Mexico City, entrepreneurial businesses in Panama City and Yangon, and a government-supported loan program in the UK succeeded in catalyzing more than a billion USD in leveraged capital. 

Dynamic success requires a complement of NGO engagement, private investment and mission-motivated entrepreneurs who together can advance heritage preservation at the urban and district levels.

FJC formed a strategic partnership with CHiFA last year as loan servicer and finance administrator.  As CHiFA raises philanthropic loan capital to invest in sites globally, FJC’s role will be to manage the operations of aggregating and deploying these funds, including servicing for its international project loan fund. This arrangement will allow CHiFA to remain lean and focused on mission, with FJC leveraging its scaled operational platform to deliver back office support and ancillary services. FJC will also manage payments for most of CHiFA’s day to day expenses.

The Cultural Heritage Finance Alliance (CHiFA) was founded in 2019 to promote heritage-led regeneration through innovative financing solutions.   Its goal is to position historically and culturally significant built environments as anchors of environmental, social and economic development.  Bonnie Burnham, president and founder of CHiFA and president emerita of the World Monuments Fund, stated: “Preserving heritage is among the targets set by the UN Sustainable Development Goals, but it is not on the radar screen of investors and institutions who are aligning behind sustainable development.  And yet there are inspiring and highly impactful examples of how it can transform the places we live, for the better.  We want to call attention to these examples so that people around the world can learn from them.”  

Public agencies are responsible for heritage preservation in most countries.  But with an increasing number of sites under protection, decreasing budgets, and low political priority, these agencies face a crisis of inadequate resources.  There is a tendency to focus on landmark structures, whereas the more encompassing urban fabric — where people live and work — offers the greatest potential for impact. While public commitments are necessary, dynamic success requires a complement of NGO engagement, private investment and mission-motivated entrepreneurs who together can advance heritage preservation at the urban and district levels. Currently, no entity exists within the heritage conservation field to facilitate these partnerships and to align capital to bring projects to fruition.

CHiFA’s research, conducted over the course of 2020, has revealed a spectrum of  successful models. The full case study analyses are linked to the appendix, and will be released as a second volume in early April 2021. 

Gary Hattem, a co-founder of CHiFA and former head of Global Social Finance at Deutsche Bank, concluded: “The experiences, ideas, strategies, and plans presented in this paper explore a new frontier: that of how to go about healing our planet and preserving the richness of the world’s cultural assets. CHiFA builds upon lessons learned to identify a financially viable ecosystem capable of validating heritage sites by leveraging their irreplaceable value to the benefit of existing residents.” 

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Register NOW: FJC will host a webinar about CHiFA’s white paper on Wednesday, April 21 at noon.  Panelists:

  • Aurora Kazi Bassett, Director of Outreach & Policy, Doh Eain: Renewing Yangon 
  • Bonnie Burnham, Founder & President of CHiFA 
  • Shoshana Stewart, Chief Executive Officer, Turquoise Mountain Foundation 
  • Sam Marks, Chief Executive Officer, FJC (moderator) 

Bonnie Burnam, who previously led the World Monuments Fund, will share lessons learned from CHiFA’s forthcoming white paper, Impact and Identity: Investing in Heritage-Led Sustainable Development. The paper features a spectrum of working models of heritage-led regeneration that integrate the siloed disciplines of urban planning, property development, heritage conservation, impact investing and community-based social enterprise. Aurora Kazi Bassett will highlight the emerging case study Doh Eain, a multi-disciplinary restoration and placemaking social enterprise based in Yangon, Myanmar. Shoshana Stewart will discuss the success that the Turquoise Mountain Foundation has had working in heritage-led regeneration in post-conflict and post-isolation environments – Kabul, Afghanistan and Yangon, Myanmar and the organization’s new project in northern Jordan.

REGISTER NOW

FJC’s Webinar with UN Foundation: “Global Health in the Pandemic Age”

In times of global crisis, philanthropy can play a critical role in deploying resources quickly as governments and multi-lateral organizations mobilize for action. In our latest webinar, “Global Health in the Pandemic Age,” Kate Dodson, VP of Global Health at the UN Foundation spoke about how individual donors came together with corporate, foundation, and others to enable to the distribution of personal protective equipment (PPE) to over 173 countries. “We used a nimble mix of partnership to get this done,” said Ms. Dodson, which included over 631,000 individuals from 193 countries (FJC donors among them!). The conversation was moderated by FJC’s Chief Executive Officer, Sam Marks. See the full recording here.

FJC Donors Join Forces to Battle COVID-19

FJC’s first-ever Collective Giving Campaign, focused on addressing the Covid-19 pandemic, raised over $147,000 for six outstanding organizations that are tackling the impacts of the pandemic in a range of ways: food security, employment, grassroots organizing, small business support, public health, and research and development. During the campaign period in May 2020, donor contributions were matched dollar-for-dollar by FJC’s Special Initiatives Fund.

Over 90 percent of participating donors who responded to a post-campaign survey found many compelling reasons to participate, such as the elevation of strong, effective organizations (many of which were new to them); the ability to align their resources with other donors at FJC; and the opportunity to have their gifts matched, effectively doubling their giving. As one donor said in her survey response, “Let’s do more work together!”

The Center for Effective Philanthropy published a blog post by Sam Marks, CEO of FJC, with further reflections on the successes and challenges of the campaign. “The initiative suggests the power that DAF sponsors can bring when they provide focused guidance to rally disparate donors around a common cause,” he writes.

FJC also hosted a subsequent webinar highlighting the work of Food Bank for New York City, the top choice among FJC donors. Food Bank CEO Leslie Gordon spoke of the operational and logistical challenges of keeping food flowing where it has been needed most during the pandemic, and cautioned that the economic fallout of the crisis may create even greater need. “This is not a sprint, it’s a marathon.” See a summary and link to the full webinar recording here.

Table of funds

Highlights of FJC’s Webinar with Leslie Gordon, CEO of Food Bank for New York City [VIDEO]

Leslie Gordon, CEO of Food Bank for New York City, joined FJC’s CEO Sam Marks and dozens of FJC donors for our first-ever “Lunch and Learn” webinar on June 30 to discuss Food Bank’s extraordinary work during the Covid-19 pandemic. Food Bank was the most popular choice by FJC donors during its recent Collective Giving Campaign, receiving over $85,000 from FJC and its donors to mitigate the effects of the pandemic among New York City’s most vulnerable.

Gordon placed her own professional journey in a multigenerational family context, contrasting the informal approach to voluntary food delivery service in her grandfather’s day with the scale, sophistication and data driven approach of the Food Bank. Food Bank’s network of food pantries, community kitchens, and local, civic, and religious organizations are committed to preserving the dignity and choice of the individuals and families they work with, and they address food insecurity with the larger goal of developing New Yorkers’ self-sufficiency with other programs and services. Across all the partners, she said, “This is a human-centered problem, we want to treat people with respect and care.”

She also spoke of the operational and logistical challenges of keeping food flowing where it has been needed most during the pandemic, and cautioned that the economic fallout of the crisis may create even greater need. “This is not a sprint, it’s a marathon.”

See the full webinar recording here.

A Generalist Encounters Nonprofit Finance

Part One of the Nonprofit Lowdown podcast featuring CEO Sam Marks (air date: March 12, 2020)

In November 2019, Sam Marks, Chief Executive Officer of FJC, was interviewed for the podcast Nonprofit Lowdown with Rhea Wong. The interview was a reunion of sorts for these two, as Sam was Rhea’s first boss in 1999 when she worked at Summerbridge at the Town School (now known as Breakthrough New York, an organization Rhea later ran for over a decade). The episode aired on March 12, 2020.

Part One of this interview focuses on Sam’s professional journey from his early years in youth development and education to “the dollars and cents side” of the nonprofit sector.

Part Two of the interview focuses on his particular vantage point at FJC, and covers Donor Advised Funds, nonprofit lending, and fiscal sponsorships.

The interview has been condensed and edited for clarity.

So what is it that you do?

I’m the CEO of a foundation called FJC.  It’s been around about 25 years.  It has over $300 million under management across about 1,000 accounts. As a sponsor of Donor Advised Funds, it’s almost it’s like we have a thousand little mini-foundations under our roof. I sort of sit at the intersection of supporting the nonprofit sector and financial services industry and global financial capital flows.

When I first met you, you were an education guy and a teacher.   Now you’re like this quasi-finance guy.  What happened?

I am even more surprised than you to find myself doing this work and thinking so much about the dollars and cents and the financing side of the nonprofit sector. But I haven’t left behind that commitment to youth development and community development and impact and all of the things we want the nonprofit sector to do.  I’ve had this interesting path where I’ve been increasingly exposed to how the money part of the sector works.

I think it started when Summerbridge was hosted back in the 1990s and 2000s at The Town School, and the first exposure I had to the money side came with one of my favorite staff people, Linda Larkin, the business manager at Town.  She was an amazing mentor to me. I had my own little mini budget to manage within the context of Town School’s budget, and she was the first person who explained to me, when you buy pencils and paper and crayons, that’s an expense. When you buy a chair or a desk, you’re purchasing an asset, something you’re not going to consume over a year, and we’re going to depreciate it over time. And that was a lightbulb to me like, Oh there’s a whole industry of people and an expertise set to help nonprofits figure out how to intersect with audit and finance.

When I went to graduate school at the Harvard Kennedy School, I took a great class with Christine Letts who was a professor in nonprofit management.   She asked us to look at audited financial statements, climb inside them, look at the balance sheet, income statement, cash flow, because those documents could help you tell a story about the organization, to connect the mission to the operations and with the way money came in and out.  It was another way to analyze an organization, and it became a fundamental skill set in my career.

“I am even more surprised than you to find myself doing this work and thinking so much about the dollars and cents and the financing side of the nonprofit sector.”

At the core when you look at the financial statements you really understand what the organization values and prioritizes.

Absolutely! And when you’re doing due diligence on the lending side, having audited financial statements means there’s a third party coming in with a set of Generally Accepted Accounting Principals and you’re able to separate the story someone’s telling you from what’s actually happening in the organization.  When those things don’t match up, that can be a red flag.

So you went to grad school, you found out financials could be super fun, and then what happened?

While I was in graduate school I found myself gravitating to the part of the nonprofit sector involved in affordable housing and community economic development.  I became focused on issues of inequality, the differences among neighborhoods in New York City, where I grew up, and how nonprofits could best intervene to address issues of inequality.  The affordable housing sector was fascinating because it was the place where community investment, government, financial institutions, the public sector, and nonprofits were all collaborating to advance a public agenda. When I was first stepping into it, I was more interested in the softer side, the programmatic side, the urban planning aspects, the pieces that appealed to a more generalist skill set. But at the end of the day, the financing and the analysis about project feasibility was where the action was. And the decision makers driving resources into cities and neighborhoods really had to develop that skill set.

I came out of graduate school, landed at WHEDCO, a nonprofit in the South Bronx that was focused on housing and economic development. And from there I went to Deutsche Bank. I spent 7 years in the Community Development Finance Group. I got to focus on lending, investing, program related investments (which are below market rate loans) and I got to straddle the foundation side as well, making grants to community based organizations. So it was a whole range of capital from grants, to loans, to equity investments and how to tailor the right type of capital to the right problems in the communities.

“[Analyzing audited financial statements] could help you tell a story about the organization, to connect the mission to the operations and with the way money came in and out. It was another way to analyze an organization, and it became a fundamental skill set in my career.”

You talked about organizations that use financial analysis to connect mission to operations.  Can you explain with an example?

I’ll give you a great example from my own experience. After I left Deutsche Bank and before I came to FJC, I spent about five years running the New York City local office of Local Initiatives Support Corporation (LISC).  LISC is a national organization that brings financing and technical assistance to low-income neighborhoods all over the country. When I started at the NYC office, LISC was in the middle of a major set of programs that we implemented after Hurricane Sandy.  We had an infusion of both private and public sector dollars, and these were time-limited programs and we knew that money was going to come to an end.  So when I came in, I knew I had a two-year runway, maybe three if the contracts were extended, and we knew that we had to do a deep dive on our business model and figure out what was making money and what wasn’t.  We had a team of lenders that were making loans to nonprofits, we had a team that were designing and implementing programs around commercial corridors and a whole bunch of other things. It was a very complex organization. 

So I climbed into the organization with the help of my finance director Wilber Gonzalez, an amazing guy with amazing skills in Excel. Working with senior management, we looked at every single program that we were running, and we looked at all the grants that were attached to those, we looked at all the revenues attached to all the various programs, and then we looked at our costs. And primarily the costs were our people power. We had a staff of 15 people, and we began to estimate the percentage of each’s person’s time on each program, and we were able to create an analysis that helped us look at what pieces of our work were earning money, what was in the black, what was in the red. That didn’t mean we were going to just shut down the money-losing programs, but it meant that we had much better handle on the true costs of running each of our program lines. And that influenced our way of thinking about how we fundraise. It made us understand that even though our lending was earning revenue, that scale of activity wasn’t going to be enough to have the whole organization operating in the black. We said, hey that’s important data, we can increase our lending but we also need to spend more time on fundraising, and making our annual gala bigger and better. That would have a bigger impact on our bottom line than trying to just double our lending. The process helped us make some strategic decisions we couldn’t have done without the data.

Check out Part Two of the interview, which focuses on his particular vantage point at FJC, and covers Donor Advised Funds, nonprofit lending, and fiscal sponsorships.

For an audio version of this interview (and dozens of others with nonprofit leaders), check out Nonprofit Lowdown, Rhea Wong’s fabulous podcast, where she reviews and recommends the best ideas, resources, tools, tricks and tips to “run your nonprofit like a pro!”