Embedded Foundations

Lucy Bernholz coined “embedded giving” last year to describe products and services that are sold to a consumer with a promise to donate some of the proceeds to charity. Now we have “embedded foundations”. From the Springfield News-Sun:

The Chapin Hall Center for Children, a semi-independent policy research center at the University of Chicago, is studying foundations similar to Springfield’s Turner Foundation to identify effective philanthropic practices that could benefit national foundations.

What researchers found is a set of foundations with an uncommon but highly successful approach to giving, researcher Mikael Karlstrom said, resulting in significant, sustainable change in communities around the country. The ongoing study, titled “Embedded Funders and Community Change,” explores foundations that concentrate their resources in one limited geographic area and become deeply involved in those communities.

National foundations can swoop into an area and give money for a reform initiative over a certain time frame. When the time’s up, they can leave whether or not the initiative achieved the desired results and move on to the next project, said Prudence Brown, a researcher for the study.

The foundations at the center of Chapin Hall’s study — what researchers dubbed “embedded foundations” — aren’t about to pull up their roots…

…”The embedded funder says, ‘We’re going to keep working at this until we get it right.’ That’s a very profound difference,” Brown said. “Many of these foundations didn’t fit the stereotype of a foundation that holds itself above everybody. There was just a very admirable sense of persistence and deep understanding of community that takes many years to develop.”

You can read the whole thing here.

In financial markets it is understood that small investors have certain advantages over large institutions (the ability to make decisions without worrying about client perceptions, the ability to invest without “moving the market” or influencing the price of the stock, the opportunity to see Main Street trends without being caught up in the Wall Street herd mentality). I think embedded foundations is one way that smaller foundations can achieve high impact.