Today marks the first 90 days since we welcomed our new CEO Joe Mrak, and the excitement continues to build as we embark on this next chapter in our company’s journey. In fact, we thought this was an opportune time to learn more about Joe and invited him to contribute his unique perspectives. Keep reading to find out more about Joe’s views on philanthropy, private foundations, advisory professionals—and what he hopes to accomplish in the coming years.
Private foundations have a long history in the United States and around the world as the gold standard for philanthropy and the surest way to leave a legacy of doing good. And yet there are also some misconceptions about setup and management—namely, that they have the reputation of being inaccessible for many wealthy individuals, families and businesses.
I believe that the foundation model is not only sound, but essential to a strong culture of philanthropy in the U.S. And I believe it is a field that is ripe for technological and process innovation that will help keep foundations at the forefront of giving for generations to come.
In particular, I think now is the time to make financial advisors and wealth management firms active partners in the establishment and operation of foundations for their high-net-worth clients. And that is what I hope to help accomplish as the CEO of Foundation Source.
Efficiency and Accessibility: Making Foundations Integral to Financial Planning
I joined Foundation Source because the company is already solving problems foundations face: managing the inherent complexities of operations in an efficient manner. For more than 20 years, Foundation Source has outsourced world-class expertise to foundations, and has designed a digital interface that helps individuals and families solicit and issue grants and keep on top of day-to-day administration.
Where I see opportunity is to lean into the technology to make running a foundation even more turnkey, and to partner with advisors and wealth management firms so that the process of opening and running a foundation is more accessible and efficient.
I believe this will have three important effects on the world of philanthropy:
- First and perhaps most importantly, I hope it will make giving an integral part of financial planning. This is a tremendous service to clients since it brings all their goals – personal investment goals, legacy planning and giving – into alignment. A family’s values and vision are a part of all of these. It also empowers advisors to engage with their clients in a new and deeply personal way, increasing the value of the service they provide and keeping more assets under a single umbrella.
- Second, lowering overhead and complexity barriers will mean more families and individuals can reasonably set up a foundation. The table stakes for setting up a foundation will drop, from the roughly $2-5 million initial contribution many experts consider the floor today to as little as $1 million, expanding the universe of potential benefactors for whom a foundation is a viable giving option.
- Third and most practically, it will make foundations themselves more efficient, reducing overhead and leaving more assets available to make the world a better place.
What Integrated Wealth and Philanthropic Planning Looks Like
Our team is already engaging with wealth management firms, banks and other financial advisory businesses to deploy Foundation Source technology as part of the advisor dashboard. In the future, advisors at partner firms will be able to look at a client’s overall financial picture – including giving – and help with foundation investments and transactions just as they do a client’s retirement accounts.
On the client side, Foundation Source’s user-friendly and efficient foundation dashboard will be the interface clients and families will use to solicit, manage and respond to grants, and keep on top of the foundation’s reports and overall status. This solution may be white labeled as part of the partner institution’s offering.
In the future, we will also be exploring how Foundation Source’s technology can be used to manage donor-advised funds (DAFs), a popular giving solution that are easy to set up and have low reporting requirements. DAFs are not only an option for those who aren’t good candidates for foundations, but also are a supplemental giving tool used by many who do have foundations.
Philtech – Philanthropy Tech – Is Part of a Continuum of Change
Wealthtech has been transforming personal finance for generations. It took stock trading from the realm of Wall Street specialists and put it in the hands of everyone. It made the everyday processes of banking as easy as pushing a button on your smartphone. Loans, mortgages, taxes, accounting, even giving to an individual charity – all of these fields have been profoundly democratized using SaaS approaches.
I hope that by engaging with advisors and wealth firms, we can help take the technological advancements Foundation Source and other foundation management providers have made and make them more broadly available.
These changes won’t take place overnight, but I believe what we are doing will elevate giving and philanthropy to the same level as investing and retirement planning: An integral part of everyone’s financial plan, for the good of their legacy and for the good of the world.
Questions in the Meantime?
Whether you’re just starting your philanthropic journey, want a better, easier way to run your foundation or are looking for ways to best support your charitable clients, you likely have questions—lots of them. We’re here to help! Schedule a call with us or reach us at 800-839-0054. Together, let’s #begiving.
