Exiting and moving on needs excellence, but it isn’t rocket science

 

Rosien Herweijer

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Rosien Herweijer

GrantCraft recently started work on a new project, an inquiry into how funders end programs, break off funding relationships and partnerships, leave program areas or countries or – in some cases – deliberately spend themselves out of existence.

We started by reviewing a broad collection of related publications and we are currently conducting the first interviews with ‘key informants’. Our first discovery was that there is a growing range of publications that document the

Russell Kerkhoven

learning around ending programs and grantmaking relations in philanthropy. These publications include detailed and summary case descriptions, generic principles, presentation and reflection on the tools and methods used. There are even bibliographies. We have compiled our list of favourites, which you can download here. We realise that this list is not complete and we will add items as we progress. Feel free to share your favourite documents or publications that describe or explore an exit experience.

Foundations make choices. Some deliberately spend out or down, others exit from any investment they make as a matter of principle (venture philanthropists) and yet others decide to exit from a partnership or country or close a specific program for a variety of contextual or strategic reasons. And there are of course hurried, emergency exits. Irrespective of why you exit, there is the question of legacy: What legacy do you want to leave behind? What do you want to be remembered for? What in fact is the ambition of your philanthropy? Overwhelmingly the written and spoken evidence on exits indicates that these questions need to be raised early on in a funding relationship, as part of the vision and strategic management of any philanthropy. While a ‘can do, let’s just get going’ approach may be an effective strategy to get in, it seems it provides a bad basis to get out.

It is also confirmed that small, big, famous and very discreet philanthropy all share a certain amount of apprehension and ‘tension’ around the practice of exiting and moving on. Exiting is not rocket science, but at the same time it is not a popular subject of discussion. The jury still seems to be out on why it is so hard to discuss legacy and exits in a timely way: psychology, skill, lack of tools? Why are we often too late, too unprepared, too much in a hurry to get out? With our informants we are currently exploring specific practices, but we are keen to hear more views on this! Do you recognise this? And if you were well prepared for your exit(s): how did you do this?

The vision of the founder and changes in the external environment are important drivers in shaping the exits of foundations, but interviews and some publications also point to internal organisation dynamics and the perceptions of boards, executives and staff being very influential. It is emphasized that there is a need for alignment, consistency and transparency on legacy and policies at all levels. One respondent suggested understanding and watching the involvement of the board is important and poorly understood, as external recognition and prestige are valuable, especially for high-profile board members. Other challenges related to exits that were mentioned relate to staff: maintaining motivation and preventing resistance. There are also all kinds of administrative and procedural hurdles. Some flag the lack of support and feedback from peers (directors and CEOs can feel lonely and vulnerable in deciding on and managing exits); and others mention issues regarding being a responsible and reasonable partner and employer.

Many sources stress that exits, decisions to move on or slim down are also about creating space for new relations and further interests. These opportunities are also acknowledged by grantees. But it seems that getting the moving on process ‘right’ requires excellence in timing, tailoring and communication.

Check out our earlier blog on the GrantCraft website introducing this project. Click here for more information on GrantCraft.

We will continue to interview and explore in the coming months. You can follow this project on the GrantCraft blog. Readers who want to share their experience or reflections are welcome to do so, by commenting on this blog or by sending a – confidential – email to Rosien Herweijer at rherweijer@efc.be

Rosien Herweijer is director of GrantCraft at the EFC, and Russell Kerkhoven is a consultant at Blue Leaf.

Tagged in: Exit strategy Spending out strategy Venture philanthropy


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