Live From CoF: 7 Ideas To Jumpstart The Economy
April 27, 2015 Paul Clolery
The tone of this year’s Council on Foundation’s (CoF) annual conference focused not just on collaboration, but also pushing foundation leaders to take more of a role in instigating ideas that spur the national and local economies and finance. Examples of the “double bottom line” of businesses doing well while contributing to the social sector were showcased during a session called “7 Ideas To Jumpstart The Economy.”
Seven executives were given seven minutes each to talk about programs that have worked when foundations have stepped in, either to develop a program, provide support to existing innovative programs, and in some cases provide gap funding to for-profit businesses that are vital to a community.
The speakers were: Cleveland Justis, executive director of the Child Family Institute for Innovation and Entrepreneurship at the University of California-Davis; Katie Merrow, vice president of community impact of the New Hampshire Foundation; Carla Javits, president and CEO of REDF in San Francisco, Calif.; Sergio Garcia, acting chairman of the Hispanic Heritage Foundation in Washington, D.C.; Earl Robinson, CEO of the New Orleans Startup Fund and PowerMovesNOLA; Michelle Sioson Hyman, senior officer of the Center for Early Learning at the Silicon Valley Foundation in Mountain View, Calif; and, Diana Anderson, president and CEO of the Southwest Initiative Foundation in Hutchinson, Minn.
Justis told attendees that “it’s not about the thing; it’s about the connection.” Innovation is not a lone person working on an idea. In most cases it’s a collaborative effort, building on previous research and work. For example, Henry Ford’s idea for the assembly line came from watching dis-assembly at a slaughterhouse.
“There are bodies of knowledge you don’t know you don’t know,” he said. He urged the group to consider new funding models, such as micro-philanthropy. “Help people take action. Remove the uncertainty. … Consider everyone and everything as an innovator.”
Merrell told of working with local businesses and the school system to better train students for the workforce in STEM (science, technology, engineering and math). The foundation was seen as a trusted neutral partner to bridge between employers and school which provide funding and scholarships. The key was to ensure there were concrete deliverables done with speed that were employer-led and make easy for everyone.
REDF has backing of George Roberts of the venture capital firm KKR. The organization provides real jobs and support services, taking people off public rolls. Javits said getting the chronically unemployed in a stable work environment reverses need from the previous 70 percent government support to just 30 percent government support. She said that data shows that $1 invested in social enterprise jobs brings back $2.23 in benefits to the community.
She said foundations should find and work with social enterprises with the double bottom line philosophy. Foundations should be flexible with capital and pay should be fair and with incentives, she said.
The Hispanic Heritage Foundation is investing in the Immigrant Technology Workforce Pipeline. Some four million tech jobs are created each year. The organization is working with high schools to start coding as a second language in 50 schools.
New Orleans Startup Fund and PowerMovesNOLA are working on developing a “hyperlocal diversity ecosystem,” said Robinson. It provides funding and $400,000 in funding has leveraged $13 million in capital commitments for local businesses.
Parenting is the target for the Silicon Valley Community Foundation. “Parenting is an economic issue,” said Sioson Hyman. One in four parents with income less than $35,000 reduced work hours to deal with childcare and one in five lost their jobs. One in four left work by choice, she said. The situation also can cause depression, which has a medical cost. An estimated 200 million job days are lost to people with depression, she said.
The key is to research and develop policy and advocacy to support parenting, she said.
The Southwest Initiative Foundation provides bridge loans for economic development. A dairy business was brought into Dawson, Minn., and other funding has saved or produced 8,355 jobs, according to Anderson. After a shaky start with 9 percent of write-offs, during the past five years less than 1 percent of loans are written off.