 Welcome everybody to another episode of the nonprofit show. We're thrilled that you are here We're gonna dig into something. That's really a mystery for a lot of people, but it is one of the coolest Philanthropic structures that we have in the US people from around the world often look at the community foundation System and what it works and we have somebody today coming to us From my own community Jill McElroy philanthropic advisor for the Arizona community foundation She's gonna really dig in with us to find out why we need to know about this Amazing structure and how you can really well, you know build a good relationship and work well with a community foundation With a community foundation easy for me to say Hey everybody, I'm Julia Patrick CEO of the American nonprofit Academy My trusty sidekick Jarrett Ransom is on an airplane heading home today from some work out of state And she'll be joining us shortly We are here because we have amazing partners and most of them have been with us since day one as we marched towards 900 episodes we're now in year four We want to give a shout-out to bloom orang American nonprofit Academy your part-time controller nonprofit thought leader Fundraising Academy at National University Staffing boutique nonprofit nerd and nonprofit tech talk These are the folks that are with us day in and day out and part of that means they're part of our archive And so if you want to access any of our previous episodes or maybe share one you can Download our sexy new app. Thanks to the American nonprofit Academy team You can get us on streaming platforms as well as podcasts. So basically wherever you are We will meet you there and connect you up with an amazing archive of guests and shows Okay, Joe. I've done my due diligence with leading everybody in You are a philanthropic Advisor and I bet a lot of our viewers Look at that title and they're like, oh, I need to know her, but I'm afraid and We're gonna get into that but talk to us about your work and how did you what was your your journey? To become this rarefied, you know professional It is I'm very friendly No fear needed All of my colleagues are very friendly Yes, but I do absolutely Understand that it's intimidating because I was My journey to the community foundation came from being a nonprofit fundraiser that is my it's really Scary for me to say that next month Marks the 20th anniversary of my first job in a nonprofit role, which I mean I know looking at me you're like you can't possibly See that age I am and Yeah, so I Came actually through the arts. I was a dancer. I was a dance major at Arizona State University and realized really wanted to be Help help the arts Nonprofit community grow and thrive. So I started raising money for them and did all sorts of you know All that all the fundraiser hats Including grant writing. I was a grant writer for quite a while. That was my role right before I came to ACF about two years ago Wow, you know, I love this because you've been on the other side of the table and that's really powerful Very valuable. Yeah, I just that that makes this conversation That much more robust. Well, let's start off with this Amazing structure called the community foundation and share with us kind of how it operates and the ecosystem with with how it works because It's something that's very magical Yes, and can be quite complex and confusing and as I said Julia when I came to ACF I came with quite a lot of experience from the nonprofit side and from Writing grants to ACF quite quite often and I really thought when I walked in on my first day I really thought I know what ACF does and it took about 20 minutes For me to quickly Know, you know a portion of what ACF does and it really does so much more So community foundations in the US Started actually the first one started in Cleveland the Cleveland Foundation in 1907 so this is not by any means a new idea and the Arizona community foundation was founded in 1978 so we are celebrating our 45th anniversary this year and What a community foundation is is what sometimes surprises people is yes, it's community foundations are funders, but Different from private foundations and because of that word Foundation sometimes people get a little confused of how is a community foundation different so a community foundation is its own 501c3 own nonprofit and But it's created for the purpose of having component funds. So it's made up of component funds All started typically by individual donors families Also corporations businesses can also start funds. We have the PECA Center for business philanthropy as well at ACF So are you in some ways serving as a fiduciary? for For startups or are all of your let me say partners Do they all have their own 501c3 status that's maintained? Are you managing that give us a little bit more in-depth look at what that structure looks like because On your website, how many I can't remember. How many organizations are you serving? Yes, so do you mean by funds so over 2,000 funds? Yeah, 2,000 There's a lot And they're all different types of funds so if um anyone who's familiar with the community foundation has most likely heard The term donor advice funds That is the most common type of fund for sure But there's also nonprofit funds. Uh, sometimes those are called just you know investment funds So a nonprofit can um put their endowment into a fund at ACF. It's invested wisely and And yep, but and then you know, they can then request. Okay, we need a distribution or set up an annual There's there's all sorts of choices. Um ACF doesn't have too many But community foundations can serve as fiscal sponsors So for those organizations that are waiting for their 501c3 status to be approved by the irs They can't you know, except um, they can't accept tax deduction tax deductible I have donations ACF can do that for them And uh, then pass the money along to them. There are of course fees involved But yes that that that is a structure. But that is possible So in the green room chatter, uh, you told told us that You're running it about a billion three and managed funds. That's right. Um What does that look like across the country? I mean, I mean to I mean the cleveland group must be, you know Substantially different. I would think I mean, what is give us give us an idea of what this might look like Sure. So Arizona community foundation with 1.3 1.4 billion assets under management. We are in the top 25 Um, largest community foundations in the country But just to give you an idea of how different it is from the top So silicon valley community foundation is the largest. That's no surprise to anyone, right? Um, they have about 13 billion in assets under management So it can be a pretty big range and community foundations aren't always statewide. Silicon valley is is a very particular geographic area um Typically community foundations serve no larger than a state but sometimes counties sometimes metro area Sometimes a couple of counties all together. It can be very very different around the country There are actually over 800 community foundations in the us and many many more around the world Um, if your listeners are in the united states and want to know Well, what where's my community foundation? They can go to the council on foundations, which is just cof.org And um, there's a whole list of community all of them You know, I love that you mentioned the council on foundations. They that's a terrific resource a great website And yeah, everybody should know about that. Um, just as a way to learn about Best practices things that are going on things at the council on foundations What they're concerned about how they're training, you know, what they're advising and best practices I find it's a great great resource that That nonprofits need to look at not just people, you know in your side of the the table um, so you talked about the structure of the The community foundation system, you know, just a little over a hundred years old Doing different things but yet kind of using the same structure across the country How do the community foundations make money and why do we need to know What this process is if we're a nonprofit Sure so community foundations charge fees for service and if A nonprofit is interested in using a community foundation To hold to hold a fund for them. They just understand, of course, there will be fees involved in that Hopefully at acf with any nonprofits that have funds with us. They really feel like they're getting quite a lot of bang for their buck there's I can of course tell you what acf does Each community foundation is going to be different but I think it would I would be hard-pressed to find a community foundation that doesn't offer some type of service to the nonprofit Field in their area for instance, you know acf does quite a bit of training Some of it's free. Some of it's not but my wonderful colleague christin mahalovic offers a planned giving series In the spring and the fall completely free over zoom. So you don't have to be in phoenix to To log in we do have people coming from other states as well Everyone's welcome the more the merrier and she it's they're an hour and You're getting this information completely for free and then there's other trainings that Are fee based as well Do you find that most of the folks that come to you and i'm not just talking about You know the the funders and the folks starting foundations, but i'm going to address more the nonprofits Do you think they're coming to you educated enough? Because I loved what you said, you know, you've been in the nonprofit sector for basically 18 years and you're thought I know this new job new place, but I got this in like 20 minutes in you're like, holy moly I don't So, you know I guess my question is if that happened to you it's got to be Pretty common. Mm-hmm Yes, yeah the When we publish because of course we like to tell the community what we're doing And so we have quarterly e-newsletters I remember getting them from board members of the organizations where I worked forward and saying well How do we get a slice of this? Why are we getting money? From a cf look at these millions of dollars. They're pouring out into the community. Look into this, right? That was that was a directive from my executive director from a board member Like we've got it. We've got to figure out, you know, how do I crack this nut? It's it's complex is The the fair way to say it a lot of those dollars that the community sees Going out or donor directed So it's through those donor advice funds. It's through field of interest funds it ACF in itself does not have a ton of discretionary funding other community foundations are in different Spots because they're just, you know in different summer some community foundations are 100 years old. We're 45 years old, right? so But how yeah, how do you How do you do that when you're when your board director says how do we get a slice of this money? um ACF offers 35 competitive grant cycles. Um, I'm I would think that is very common throughout the community foundation world is You can apply for competitive grants And then if your donors your own donors in in a nonprofit your own donors Most likely some of them have donor advice funds. You may not know it They may not realize that you can you know, like yes, you can give us a check. That's lovely You can also advise a grant recommend a grant from your donor advice fund so it's educating nonprofits of just how that how those funds really work and Making sure the donors understands that hey, yeah, you can just recommend a grant to us from your donor advice funds and and That that's the same. It's the same as writing a check yourself You know, it's um, there's so much fear Based uh and interpretation when it comes to How am I going to get in front of these program officers and and what you just said? I think understanding how the system works is really the starting point to being confident and and knowing how to To to do this I can see your you know, your board member or ceo throwing down that That piece of paper saying, you know, why aren't we on this? Sounds to me like they didn't know what the process was what the program officers do Is there some way that we can just get in front of somebody and introduce ourselves and not like say I'm doing this hard ask for this particular grant cycle, but just You know navigate a relationship or should we not do that and just go Proform a you know through that grant cycle process you know, um We we get a lot of that. So I will say it can sometimes be overwhelming. We cannot Go on a site visit for every single nonprofit that wants us to come on a site visit. So I'll just You know, yes, we do have 70 plus staff But you know, yeah, it would be really fun if my job was just going to visit nonprofits all day That would be really fun I don't I don't think my boss is gonna. Uh, okay that one Um, so yeah, it's it's capacity, but um, yeah Email phone as I said, we're we're not scary people Many of us and I and I think I can probably pretty confidently say with other community foundations around the state Or I'm sorry around the country that Most people gravitated Gravit to this work Typically have some type of nonprofit background. So we get it. We we do know because we've been in your shoes Um, we the answer may not be yes in terms of coming for a site visit. We're saying. Oh, yeah We actually have this grant That we're that's just lying around and we don't know where it is where to send the money to that does That's just There's far more uh places to send money to than there are dollars to send of course, so yes, but email phone call, um We we have at least at hcf. We have kind of a almost like a library. Um a place in our shared drive where Information that nonprofits send us gets put there and then a lot of times, you know, what I do is I work with donors mostly who have donor advice funds a few other types, but mostly donor advice funds and they'll Sometimes ask and say I I'm really interested in this issue this problem Um, you know, this is my passion area Yeah, I know about this organization in this organization. What am I missing? What else is going on in my city in my county in my state? That's working towards this issue that I care about and that's that's where a philanthropic advisor comes in and says Oh, yeah, let me do some research. Let me can introduce you to some more nonprofits that you fall in within your interest areas And um, hopefully that leads to something not always sometimes it doesn't but sometimes it does And I I'll tell you a quick story Julia I was meeting with the donor and the first thing he said to me when I sat down at starbucks was I have a hard stop Um at 11 because I have a guitar lesson said, oh, that's great. You're a musician. That's really cool I had seen from his previous giving that he supported the arts and I was like yay because that's my background too Love it. Yeah And it wasn't until I was driving home that I said wait a second Why didn't I tell him about this organization that that offers really great music programs? I just didn't think of it. But when I got back to my computer, I wrote him a thank you Yeah, so great to meet you by the way, you might just be interested to know about this organization They're they're maybe you know similar to an organization that you've already funded, but here's how they're different and And he could have said yeah, thanks Jill great and done absolutely nothing with it He researched them. He decided to recommend a grant from his donor advice fund and now over a year later. He's on their board So that's really that's what a philanthropic advisor does but the donor also has to be Open to some some donors just really don't like they know what they want to fund they're you know and That's it and that's totally fine and they're using the tool It's fine. But why we're here why why philanthropic advisors are here is to Help and guide when donors need it So Jill let me ask a follow-up question because I love that, you know You're you're linked to the arts world and and being literally on the other side of the desk doing that work um Is it a structure where you have experts like you have An advisor who's an expert in arts and culture education science technology? I mean because how can you be expected to know Everything that's going on. I mean do you all do that or is that a common practice? In some community foundations It is a common practice where there are program officers that specialize in certain areas acf itself is not set up that way We do have 70 employees So kind of between us all there are also I should say Juliet there are over 22 000 nonprofits registered just in the state of Arizona There's no way we can't you're 70 people can know You know, oh, yeah, between, you know, all of us we just divide and we have 5000 That just live in our heads It can't that can't be but we have the tools to go out and and really find what What the donor or what some discretionary funding can can really help with and I will say that our Our program officers are really focused in getting into rural Arizona so I mentioned In the green room chatter that we have five regional offices And staff that live in those communities and then also our program officers that work out of central office But they're always in the community Uh, you know from every corner of the state Amazing. Well, jill. We don't have a lot of time left But I guess you know the boil down is now that you've painted a picture That helps us to understand what the function is and how may we might You know engage in this relationship What is it that you and your donors are looking for what makes it as we like to say a happy marriage in this in this relationship? Can you give us some advice on that? Sure. Well, just like a happy marriage communication Yeah, the donors like, um You know, just those really really simple, you know fundraising 101 things and acknowledgement letters. Um I will say we do get a lot of mail and some We do pass on acknowledgement letters to the donor We typically don't pass on solicitations because they they kind of know they they get it. Um, and uh so a strong relationship with us in terms of I I know I I in the past two years that I've been with acf I've met so many people and so many nonprofits that just working being focused in the arts field I would have never met because they're they're working outside of that field and into areas that I just I just would not have stumbled upon otherwise. Um, yeah, so letting us know what what you're doing what you need and um And then if you there is a donor that has a donor advice fund at acf Yeah, just that communication you attending um acf trainings attending events Just lets us It's that networking. It's that you know build you build up your network and and then we know and we oh I met that person was here last week in our office when we held this event. They were telling me about Yeah, this anecdote this story this program And then who knows a donor may call up the next week and say Jill tell me about this and like oh there's that connection. So right well, it's such a journey because I think um You know things happen in a donor's life And sometimes it's emotional sometimes it changes what they believe They want to fund or they they recognize that they can be a solution to something Other times it's it's like a lifelong Mission of one track and then sometimes it's a change of circumstances I've got to believe that you're witnessing this amazing transference of wealth that's going on That we're in the middle of in america And so the people are probably funding differently because their assets have changed, right? Yeah, sometimes and we're starting to see yet the next gen of The donor who set up the donor advice fund or some other type of fund if there is a successor advisor We're now working with the children the grandchildren the nieces nephews, you whoever and that's that's really interesting learning educating maybe Children who either were completely unaware of what their parents are doing we're aware of it But we're never really involved or and now they're kind of stepping into that role that that is a really fun conversation most of the time Well, I love most of this You know, it's it's a fascinating thing because we we talk about this a lot I mean giving us a uh reports on this every year You know the demographic shift on what you know, uh different levels of americans in terms of that demographics break it down to age What you know the older folks gave to and continue to give to and steward Very different. Yes, we go from generation to generation. Yes, it can be Yeah, yeah, I'm sure that can be pretty dicey to have some conversations It can it can and a donor if they are worried about that of maybe they don't want to leave This philanthropy to their children's most donors are really excited to do that But just like you said julia if they know that their children really support Things very differently than they do They can always they can give us instructions on what happens after their lifetime and it doesn't necessarily have to roll down to another generation The donor advice fund can convert Uh to a different type of fund Something maybe called a designated fund that just lists You know certain organizations and they'll tell us you know give 10 percent you know every year to To this organization that organization and then it just that just can be set up You know kind of a set it and forget it type of thing and then that's it and then um Some donors just simply don't want to bother they think well. I don't want to bother My children my niece of the unit the next generation my neighbor My friend whoever they're going to name you like This is kind of my thing And they're happy for the community foundation to continue it upon their instructions After their death. Yeah, it's such an amazing Structure that supports Philanthropy in many different ways I think it's fascinating to go on to different community foundations Websites and look at some of their funds and a lot of times they're incredibly humble people You know that a lifelong nurse or a lifelong teacher or something and that they You know Have a key to a solution. They felt that they could you know navigate and so Really interesting Jill McElroy philanthropic advisor with arizona community foundation, which is exciting to have somebody from my own community On the nonprofit show talking to us More than 2,000 non for more than 2,000 community foundations in the u.s. More than 800 foundations Okay, but many and they exist in and all over the world Amazing council on foundations. Um, jill gave a really good A piece of advice there to take a look at where you might be Able to create a relationship with somebody in your community or your region Looking at the cof.org and looking Direct directly into What that? Opportunity might look like and who you can reach, you know, I love that you took away a lot of fear Um, I love that you shared with us that you were on the other side of the table For the majority of your career and how people You know your cohort at work a lot or like you That they came to this work from the nonprofit sector. And so, um, I think it's it's really you've Kind of debunked a lot of myths that we might have had about the community foundation system. Thank you. Thank you so much Well, I hope it did Thank you Julia. This has been so fun. It's been really great again I'm julia patrick's ceo of the american nonprofit academy Jared ransom the nonprofit nerd will be joining us shortly Again, we are here because we have amazing amazing partners and I want to call them out Bloomerang american nonprofit academy your part-time controller nonprofit thought leader fundraising academy at national university staffing boutique non-profit nerd and non-profit tech talk These are the folks that join us day in and day out so that we can introduce you To people like jill mackerel worry jill. It's been really a lot of fun. I i'm i'm super impressed with um, how the community foundation has grown and i'm very very fortunate to uh be Having been witness to this in my lifetime in my own community It's really an amazing thing. So thank you for your service. Thank you julia. Thank you for joining us Hey everybody, we sign off every show with this mantra and i'll share it with you now And it goes like this Stay well So you can do well. We'll see you back here tomorrow everyone