Foundation Source Report Reveals 2017 a Banner Year for Private Foundations

Foundation Source, the nation’s largest provider of comprehensive
support services for private foundations, today released its 2018 Annual
Report on Private Foundations, a study of how 927 of the firm’s clients
with assets of less than $50 million fared in 2017 vs. 2016. The report
found that in the aggregate, these private foundations earned more, gave
more, and received more contributions from their donors in 2017 than
they did during the prior year.

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Net Change Asset Values (All Foundations). (Graphic: Business Wire)

Even after accounting outflows of grants and expenses, the overall asset
balances of the foundations saw double-digit growth: 13.2% in 2017
compared to 6.6% in 2016. In the aggregate, assets held by the 927
foundations increased from $4 billion at the end of 2016 to $4.5 billion
by the end of 2017.

Although the stock market was robust in 2017, donors did not rely solely
on investment returns to fund their philanthropy. Instead, they
supplemented their earnings with strong contributions, contributing 83
cents to their foundations for every 89 cents they disbursed as grants
and charitable expenses.

“The high rate of contributions is a good indication of donor commitment
to and enthusiasm for their private foundations,” Page Snow, Foundation
Source Chief Philanthropic Officer, said. “Rather than relying on
investment returns, donors are providing infusions of fresh capital to
fund their charitable interests.”

The report also found that in 2017, the sample of foundations
collectively gave $285 million in charitable contributions compared to
$266 million in 2016. Moreover, these foundations exceeded the mandatory
5% distribution requirement: On average, they distributed 8.2% of their
assets for charitable purposes with the smallest foundations in the
sample (those with assets of less than $1 million) giving in excess of

“At this point, it’s unclear whether strong 2017 earnings will be
predictive of a grantmaking spike in 2018,” Ms. Snow said. As the annual
minimum distribution requirement for private foundations is based on
calculating the net assets of the previous year, the gains of 2017 could
translate into increased charitable support in 2018. “We’ve been
conducting these studies for a decade, and consistently, we see clear
evidence that these foundations punch above their weight, even in
unfavorable economic climates. If current economic trends continue, it
could bode well for 2018 charitable distributions.”

About the Foundation Source Annual Report

The 2018 Foundation Source Annual Report on Private Foundations
uses data sourced from actual transactions of Foundation Source’s client
foundations, thereby providing the timeliest and most accurate look at
the activities of foundations with assets of less than $50 million.
Because foundations of this size represent 98% of the approximately
83,000 private foundations in the U.S., the report offers a rare
opportunity for foundation donors and their professional advisors to
benchmark financial and grantmaking performance.

The full report can be downloaded here (

Report Methodology

The findings in the report are based on Foundation Source’s analysis of
the activities of 927 its private non-operating foundation clients with
assets of less than $50 million. Data are drawn from actual investment
returns, asset balances, and transactions recorded by Foundation Source
as it paid grants and expenses, filed tax returns on behalf of its
clients, and recorded investment information provided by each
foundation’s financial institution. (Foundation Source does not custody
or manage assets).

About Foundation Source (

Foundation Source is the nation’s largest provider of comprehensive
support services for private foundations. Our complete outsourced
solution includes foundation creation (as needed), administrative
support, active compliance monitoring, philanthropic advisory, tax and
legal expertise, and online foundation management tools.

Now in our second decade, Foundation Source provides its services to
more than 1,400 family, corporate, and professionally staffed
foundations, of all sizes, nationwide. We work in partnership with
wealth management firms, law firms, accounting firms, and family offices
as well as directly with individuals and families. Foundation Source is
headquartered in Fairfield, Connecticut.

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