CASE STUDY:
A donor is asked to make a lead gift to create a new university research center
ISSUE:
Would a $2 million startup gift pave the way for a new $25 million research center?
PROJECT DESCRIPTION:
To give or not to give? It’s a question faced by many wealthy individuals who are looking to make a positive impact on causes they care about. Ensuring that one’s gift achieves its intended outcome, however, requires much more than simply writing a check.
We helped a client tackle these issues head-on when he asked us to analyze a $2 million request he received from a major university in Ohio. The requested funds were to be used to support a new research center dedicated to a life-threatening disease. Our client, who had lost a son to this disease, was eager to support the cause, but asked us to investigate before he formally agreed.
We visited the school and met with three senior staff members to learn about the project and confirm the details that had been described to us by the client. The details that emerged during the visit were different than what our client had understood. First, the funds were going to be split into two separate projects: the first $1 million was to fund the construction of a new hospital, and the second $1 million was to fund a research program focused on the disease of interest, but not to launch a new research center dedicated to the disease, which was our client’s greatest interest.
University staff assured us that they were committed to launching the $25 million research center. We asked if the university had formally approved the establishment of the new center, whether there was a formal plan to raise the additional $24 million for the center, and if there was a staffing plan, among other pertinent issues. We learned that none these actions had occurred, nor had any formal decisions been made regarding the launch of the new research center.
RESULT:
Our client chose not to make a gift. We were able to determine that the use of the gift wasn’t aligned with our client’s interests, and we were able to avoid a significant misunderstanding and future unhappiness.