Social Impact Investing Explained

For decades, the primary tool available to philanthropists were cash gifts and grants to nonprofit organizations. In the ‘60s that began to change as forward thinking organizations started offering low-interest loans to create low-income housing.  Today philanthropists employ multiple tools to harness the power of capital markets and spur societal change:

  • Debt offerings such as bonds to improve municipal water systems
  • Microfinance
  • Deposits with Community Development Financial Institutions (CDFIs), and
  • Mission Related Investments, such as investing in new diagnostic technology to improve health outcomes.

These examples illustrate how strategic financial investments, coupled with innovate business models, can serve as a catalyst for an even greater impact.

In fact many entrepreneurs argue that the world’s most pressing large scale problems might better be addressed by business rather than nonprofits at all—universal access to high-speed internet, tackling global waste (e.g. resource recovery) and, as featured in this WIRED Magazine article, phone applications to enable individuals and families to manage food stamp benefits.

All donors want confirmation that their dollars are being put to work in a measurable way.  Social Impact investors measure their return on investment by benchmarking social outcomes and financial returns.

Two common reasons impact investors partner with Rodman & Associates is to receive support for a one-time need, such as drafting an Investment Policy or research into a specific field of interest, and to increase long term capacity through annual evaluations of social return, which can insure the needle is moving–and in the right direction.

Interested in learning more about Impact Investing for yourself or your clients?  Let’s have lunch.

Creating a Meaningful Legacy No Longer Requires Great Wealth

American philanthropy has multiplied 6 ½ times since the 1950’s. As our giving grows, the ways to create a philanthropic legacy have extended beyond naming a building or establishing a large endowment. While 91% of high net worth families give to charity, 59% of families with moderate incomes also give, and creating a meaningful legacy no longer requires great wealth. Today, having an enduring, positive effect on a cherished cause or organization can be achieved through service, leadership and donations during life—as well as through gifts from your estate.

Creating a meaningful legacy relies on the combination of clear intent on the part of the donor, thoughtful communication regarding the current and longer term needs of the benefitting organization and an assessment of financial capacity—at present, in the years to come and after death. Addressing each of these will benefit from collaboration with a skilled philanthropic advisor, to thoughtfully engage with your existing estate and financial advisors and the benefiting nonprofits, to arrive at the most effective strategy. Bringing the next generation into these conversations results in deeper family ties, more purposeful philanthropy and can extend the family legacy through generations.

This longer view often results in a combination of aligned gifts. For instance, a one-time gift for a particular program or initiative, with annual support to sustain that gift and finally a bequest that will allow the organization to take your generosity to the next level. Taken together, this is a powerful legacy.

There are many estate planning strategies that do not require complicated and expensive financial instruments. For example, simply designating a non-profit as the beneficiary of all, or a percentage, of your IRA will support your philanthropy, reduce the taxes on your estate and does not require added legal advice. The same is true for other retirement plans, insurance policies and annuities.

Want to learn more about Legacy Giving? Click through to our Q&A with Joy Selak, CAP® Legacy Giving Q&A

Rodman & Associates was recently quoted in the Austin American Statesman’s analysis of the Giving USA 2017 report.  Here we recap three key takeaways from the report as researched and written by the Indiana University Lilly Family School of Philanthropy.

Giving-USA-2017 report cover

All of the philanthropic focus areas tracked went up, a rare occurrence.  For only the sixth time in the last 40 years, every single nonprofit sub-sector tracked—from health, to religion, to human services—realized an increase in donations in 2016.

The arts, environment, and international causes had the largest growth year over year, and we believe this is no coincidence. These are the types of nonprofit organizations working at the cutting edge, utilizing technology and innovation to re-think donor engagement.  Our favorite case in point is the San Francisco Museum of Modern Art’s recent Text to See campaign.

Particularly noteworthy: Giving to international groups grew 4.6 percent in inflation-adjusted dollars, to $22 billion. Especially impressive given there were few of the large-scale international disasters that usually drive that type of engagement.

Individual givers continue to drive American philanthropy.  Charitable giving by families, foundations and corporations all increased in 2016, with a 4% jump in donations from individuals alone. In total, donations from individuals amounted to nearly three-quarters of all giving in 2016.

New patterns emerging. Una Osili, Director of Research for Indiana University’s Lilly Family School of Philanthropy and lead researcher for the Giving USA 2017 report, said they are seeing successful young technology leaders starting their philanthropy earlier in life, as early as their twenties and thirties. These donors are adopting new forms of philanthropy using program related investment, impact investing and more collaborative models of giving.

Giving USA, the longest-running and most comprehensive report of its kind in America, is published by Giving USA Foundation, a public service initiative of The Giving Institute. Year after year the report provides an unparalleled look at how and why people give, and how those patterns unfold over time. A copy of the full report can be purchased here. And as a free resource download the infographic for an overview of major giving trends.

The greatest transfer of generational wealth in American history, coupled with a rising tide of new wealth among American entrepreneurs, has increased the need for donors to be supported in making strategic and effective philanthropic decisions. Rodman & Associates brings years of experience in designing philanthropic giving models, achieving meaningful results and assessing impact.

10 Big Hearts = 1 Tiny Home


The story of the newest residence in Community First! Village started with a group of 10 retired guys who played golf a couple of times a week. Their wives became friends and the group began to socialize, starting a dinner club and even traveling together.

One couple, Skip Helms and his wife Connie, belonged to Lake Hills Church, a congregation providing volunteer services for Mobile Loaves and Fishes, a program that delivers dignity, opportunity and healthy meals to disabled or homeless citizens. This led the couple to Community First! Village, the visionary, ground-up Austin community providing housing for the disabled and chronically homeless and led by the indomitable Alan Graham, CEO of Mobile Loaves and Fishes.

This 27-acre east Austin property is providing individual homes for nearly 200 men and women, with amenities such as an outdoor theatre, a vegetable and flower garden, pens to raise chickens and goats, art and welding studios, and a shop where handmade products can be sold. After Skip Helms visited the Village, he couldn’t wait to tell his golfing buddies about this amazing place.

The group wanted to know more, so the couples all went to Community First! Village and took a tour, then shared a group meal on the property. They learned that the project was supported entirely by private funding, that there was a packet of Tiny Home designs that donors could choose from and see built, that residents were carefully selected and supported, and that all residents worked on the property to pay their rent and other expenses. Skip’s son in law, a builder, said “If you fund one of these houses, I’ll build it.” (more…)

From Overalls to Black Tie…building a better board

sm Overallssm Black Tie

We field more questions from colleagues about the role of a nonprofit Board than just about anything else. The answer is always, “it depends”.

As a nonprofit organization matures, a healthy Board will grow right along with it. For an organization to be sustainable over the long-term current leaders must face up to the realities of what it will take to successfully lead the organization in the future.  A board member who is valuable at the early stage of development may not have the appropriate skills necessary to be an effective board member of a fully developed organization, and vice versa.

We’d like to share this very visual description of the life stages of board development—From Overalls to Black Tie. (more…)

Can We Talk About Money?

When I accepted a position as the Development Director for a small Austin nonprofit, I thought that my years of service in the sector would inform the role. I had been a nonprofit founder, board member, leader and consultant. Surely, I could effectively apply these experiences to this new role. But, as it turned out, it was older lessons — learned when I was a financial advisor — that would serve me best.

During 14 years managing portfolios for my clients, I learned from the trenches how to, and how not to, talk about money. Being a Development Director is all about money, right? Now, as a Philanthropic Advisor with Rodman & Associates, I work to serve the interests of non-profits and foundations, corporations, families and individuals. We are still talking about money, specifically how to do good in the world through philanthropy.

There are similar practices among non-profits and the world of business and finance, some that work well, and others, not so much. I’d like to share what I learned about three of them: Building Relationships, Making the Ask and Donor Retention. (more…)

Joy Selak Joins Rodman & Associates

Former MINDPOP development director founded two nonprofits, was ZACH Theatre president

AUSTIN, Texas—Rodman & Associates, an Austin-based philanthropic advisory firm, announced that in April, Joy Selak, Ph.D., joined the team to help individuals, families and organizations plan their giving in ways that are strategic and impactful.

RA - Welcome Joy - Twitter ImageSelak has more than 20 years in nonprofit leadership at organizations including Austin’s MINDPOP, ZACH Theatre, and A Legacy of Giving, which she and a group of Austin leaders founded in 2007 with a mission to grow a new generation of philanthropists among the students of Central Texas.

As a Chartered Advisor in Philanthropy (CAP®), Selak is a member of a growing network of top planners working to make philanthropy more effective and dynamic for generations to come. The CAP certification has been awarded to nearly 1600 candidates nationwide from the American College of Financial Services. (more…)

Purpose beyond Profits

The Purpose Effect

Many long-running cause marketing campaigns ceased to exist this year. Lee’s Denim Day, Yoplait’s Save Lids to Save Lives and Campbell’s Labels for Education to name just a few.

So what’s going on? Could this be the death knell for Cause Marketing?

At Rodman & Associates, we think not.  Companies–and their consumers–have become more sophisticated, and they are demanding more from Cause Marketing campaigns.  The evolving trend is for corporations to define and create a unique program that reflects the core DNA of the business itself.

Outstanding examples include: (more…)