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| Path: Main Street : NewsWeek : Archive : Funder Focus : Article |
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Funder Focus: Jesse Rasch and the Jesse & Julie Rasch Foundation
By Elisa Birnbaum
December 4, 2006
This month in our Funder Focus we feature the Jesse & Julie Rasch Foundation, which was established in 2000 with the mission of achieving enduring change to improve the quality of life for generations to come. CharityVillage spoke with founder Jesse Rasch about the inspiration behind his foundation, its objectives, and how they reflect the interests close to his heart and the hearts of his family.
Charity Village: Most 24-year-olds don't start foundations. What compelled you to take that step and what was your vision?
Jesse Rasch: I was young when I founded the foundation. But, I was also young when I founded my first company at the age of 17, and young when I built my third company, InQuent, to a value of $340 million at the age of 24.
I have always felt a strong desire to improve society; I was an environmental activist in my youth. When I reached the point in my life where I could make significant charitable contributions, I felt the only way I could be assured of the maximum impact for my donated dollar would be through my own foundation.
Not unsurprisingly, I quickly came to learn that many established charitable foundations were onerously bureaucratic. Many segments of the charitable sector were, and still are, in dire need of greater efficiency and could learn much from the world of for-profit entrepreneurship. Improving charitable processes and providing capital for underserved niche opportunities were two areas I felt were not being fully addressed by existing charities.
My vision in establishing the Rasch Foundation was simple - I felt I could contribute to making the world a better a place. That was the goal then; that's the goal now.
CV: On your web site you name six separate areas of focus for the foundation. Why did you choose those particular areas?
JR: At first glance, one may come to the conclusion that we lack focus due to the varied number of areas we operate in. In our case, however, diversity is one of our greatest strengths.
When I established the foundation, one of my founding intentions was to create a vehicle that would engage my family members in participatory philanthropy. The key to successful participation is having a vested interest in what you do. In the case of our foundation, I knew that my family members would be more engaged if they could pursue their own philanthropic agendas through the foundation.
It was as a result of this thinking that we arrived at the six areas of interest we fund today. In fact, we may very well grow to support additional new program areas as my family grows in the future.
While I have a general interest in all our mandates, I am most focused personally in supporting niche initiatives in the areas of social entrepreneurship and the environment.
CV: Yes, you do seem to place an emphasis on working with, and funding, entrepreneurial ventures. Why is that so important to you?
JR: For-profit entrepreneurship is largely responsible for the majority of wealth creation in society. The whole notion of nonprofit, or social, entrepreneurship is relatively new and has really only gained momentum in the past five years. The idea is to take the principles of entrepreneurship from the private sector and apply them to the charitable sector. This does not work in all cases, but it can be a highly effective management style for many charities or charitable projects.
As a startup guy, the concept of social entrepreneurship naturally fits with my world outlook. A startup in the for-profit sector has to be nimble to survive - capital efficient, able to quickly adapt to changing circumstances, and hopefully deliver a product or service that has the power to change the way people do things for the better. All these points are just as relevant for charities as they are for businesses.
I favour projects where I will have an opportunity to apply my entrepreneurial knowledge to better a charity. Also of importance is the fact that I am the sole funding source for the foundation, so naturally I want to ensure that my dollars are being invested in projects with the greatest likelihood of success!
CV: How do you decide which organizations, and how many of them, to fund? Are there specific criteria that you look for above all others?
JR: Our first filter is simple: is the proposed project in one of our predefined areas of interest? If it is not, but we feel the proposal has merit, the project may still qualify for funding under our discretionary program. This program grants small gifts, not to exceed $20,000, to qualifying charities. Cumulatively, we gift an average of $100,000 per year to as many as 25 different charities in the discretionary category.
If a proposal comes in and fits within one of our areas of interest, the next filter is to review the people behind the project: Do they have what it takes to translate their idea into action? Can they raise additional capital if needed to tip the odds of success in their favour? Will they be frugal with the money they raise and ensure it is deployed wisely? Will they maintain a consultative relationship with their donors regarding use of proceeds and project reporting? These are only some of the many questions asked at this stage.
Next, we will do our own internal review of the project and try to make our own assessment as to whether or not our dollars can have a measurable impact and effect positive social change. Once we review these and other criteria, a report is made and presented to our board for discussion. We are generally agnostic as to the size of an organization; we will fund proposals from charities whether they be large or small. In this category, we fund five to ten projects per year ranging in size from $20,000 to $200,000 each.
CV: Are you focused strictly on funding in Ontario or does your reach go beyond the province?
JR: With few exceptions, we generally guide ourselves by the mantra "Think Globally, Act Locally". Approximately 80% of our grants are directed to Ontario-based charities. I'd estimate that 17.5% are awarded to charities in other provinces. The remaining 2.5% of grants are awarded to US and international charities on a very select basis and where permitted by law.
CV: Established in 2000, yours is a relatively new foundation. What would you say were the main challenges you faced when starting it up and what advice can you give others who are thinking of doing the same?
JR: As a relatively young philanthropist, I had no other peers with whom I could strategize about the somewhat unique aspects of establishing a private charitable foundation at a young age. This was not an impediment though - I am quite accustomed to undertaking projects on my own that have no precedent.
My advice to other entrepreneurs is that regardless of your age, if you have had a significant wealth creation event in your life there is no valid reason for you to not start your own foundation, or support an existing one. I believe we all have an obligation to make the world a better place.
I can assure other entrepreneurs, who are familiar with the satisfaction that comes from building a company from scratch to a successful entity, that they will experience the same satisfaction investing their time and money into charitable ventures as they did from building their business.
CV: Considering all you've learned and achieved since the foundation's inception, how do you see the foundation evolving in the next five or ten years?
JR: I predict our grant volume will increase significantly due to new capital additions to the endowment and sound investing of the foundation's current assets under management. I see our approach to funding entrepreneurial ventures in the charitable sector evolving as we learn which principles from the for-profit world translate successfully to the nonprofit world and which do not. I see a multi-generational board that unites our family with a common objective of doing social good. Finally, I see myself spending close to 100% of my professional time dedicated to running the foundation.
For more information about the Jesse & Julie Rasch Foundation, visit: www.raschfoundation.org.
Elisa Birnbaum is a freelance print and broadcast journalist living in Toronto.
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