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Cambridge, MA — Limited life foundations, which choose to spend themselves out of existence because of the belief that it will lead to greater impact, grapple with a similar set of issues in their journey to spending down. But there is great diversity in the decisions leaders of limited life foundations make about how to address these issues, finds new research released today by the Center for Effective Philanthropy (CEP). Based on interviews with leaders of 11 spend-down foundations, the report, titled A Date Certain: Lessons from Limited Life Foundations, explores the approaches of spend-down foundations in nine key areas, including investing, grantmaking and strategy, and communications.

“When we began this research, we expected that most of these foundations would take a similar path to spending down,” said Ellie Buteau, vice president, research, at CEP and co-author of the report. “But from what we heard, we learned that there is no one way to spend down. Our hope is that this research will help foundations that are spending down — or those that are considering spending down — explore a range of approaches as they consider their own planning and strategies.”

Overall, the research reveals the breadth of decisions that leaders of limited life foundations make when it comes to investing, staffing, grantmaking and strategy, what they owe to their grantees, collaborations, communications, and evaluation. For example, with staffing, some foundations grew their staff to pursue their goals in a shorter period of time, while others chose to keep staff size steady or hire consultants to support existing staff. With evaluation, some limited life foundations are increasing their emphasis on their evaluation work, while others are uncertain about focusing on evaluation given their limited timeframe.

There was consensus across the interviews when it came to foundations’ reasons for spending down — the opportunity to have greater impact was the key driver. There was also agreement about the importance of archiving knowledge, as the majority of interviewees expressed interest in preserving their respective foundation’s work and lessons learned over its life. Further, across all nine areas, a commonality that came through was the level of care, planning, and careful consideration that limited life foundations are bringing to their decisions.

“Through our conversations with these leaders of limited life foundations, we quickly came to realize that being thoughtful about these nine issues — while also guiding a foundation through its daily work —  requires quite a bit of time and effort,” said Charis Loh, associate manager, research, at CEP and co-author of the report. “But we also learned that these leaders feel the opportunities to have greater impact make the challenges of the limited life approach worth it.”

The report is accompanied by a companion publication of case studies about three of the foundations featured in the report: the S.D. Bechtel, Jr. Foundation, the Lenfest Foundation, and the Brainerd Foundation.

The S.D. Bechtel, Jr. Foundation provided funding for this research. Download the report and the case studies here.

About the Center for Effective Philanthropy

The Center for Effective Philanthropy (CEP) is a nonprofit organization with a mission to provide data and create insight so philanthropic funders can better define, assess, and improve their effectiveness and impact. CEP received initial funding in 2001 and has offices in Cambridge, Massachusetts and San Francisco, California. For more information on CEP’s work, including its research, programming, and assessment and advisory services, see www.cep.org.

The Center for Effective Philanthropy — Improving foundation performance through data and insight.

 

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