By Aja May Pirtle
This article is the first in a series of case studies on nonprofit organizations and the way they approach organizational sustainability.
Like many nonprofit organizations currently, the Legacy Collective, a collective giving circle with an eye towards sustainable and innovative systemic solutions, and its co-founder, author Jen Hatmaker, recently have been contemplating how to build out their organization for greater impact. For the Legacy Collective, that meant a shift away from a Donor Advised Fund (housed within Pure Charity, a 501c3) towards an independent nonprofit.
Recently, I sat down via Zoom with Erin Arnheim, CEO of Legacy Collective, to discuss this move and what questions their team asked as they worked through this process. Their case study can provide insight for other groups navigating the complex landscape of the third sector.
First, Arnheim noted, they realized that their organization had outgrown its home within the DAF. Pure Charity had served as a needed incubator for Legacy Collective when it was first created, but now the DAF structure limited their ability to stretch and grow. For example, corporate sponsors couldn’t give in the way they would like because of the rules inherent in donor-advised funds.
“We were coming across companies and other DAFs that could not donate to us due to policies around not donating to DAFs. Employee match programs were facing complications with our DAF status under another 501c3. And when we added up all of the funding opportunities we were missing, it was clear that we needed to move forward toward becoming our own nonprofit.” Erin Arnheim, Legacy Collective, CEO
Next, the group determined they would dream big. In 2021, the organization had grown to raising—and giving away—over 1 million dollars. Members of the leadership team started to recognize needs for new giving circles, including for corporations and cities. These giving circles would allow for collaborative giving with an eye towards a common goal. Legacy took their collective giving model for individuals and adjusted it to create similar communities in corporations and cities that would keep the same principles of impact, equity, education, and community but allow for a different audience to participate in the model.
“We know that some of the biggest factors employees face in corporate matching programs is not knowing where to give or which nonprofits to trust. And we know that oftentimes, small and midsized companies don’t have the resources to facilitate these programs. So, we have built this model that allows the employees to trust where their funds are going through our comprehensive and transparent vetting process and companies can offload the time it takes to us for no cost besides the corporate match if they chose to make one.” Erin Arnheim, Legacy Collective, CEO
City Giving Circles are a concept they have just begun to launch. Legacy works with cities that make this option available to conference and convention meeting planners to give back a portion of their registration fees to a pre-vetted list of local nonprofits in their event host city. Legacy believes this could transform cities once the hospitality industry resumes pre-pandemic event levels. This allows for meaningful levels of funding to nonprofits that they would not have to spend fundraising dollars to obtain. Cities, conventions, attendees, and nonprofits would all benefit from this program.
Lastly, the organization knew that it needed to start to think sustainably. While Jen Hatmaker’s name and community have helped grow Legacy Collective, the organization needed to make sure that it became more than just a pet project and instead thrived because of its mission and the impact made. Through corporate giving circles, city giving circles, new cause area-specific giving circles, and expanding their Legacy Giving Circle with a Board and Advisory Board that is composed of individuals outside of Jen’s community they are building a sustainable organization.
According to Dr. Genevieve Shaker, “Celebrities, like Jen Hatmaker, are involved in philanthropy in various ways, including giving their own money, time, and advocacy. In founding Legacy Collective, Jen Hatmaker also brought together the interest, energy, and involvement of her fan base and their networks. This is a powerful combination. But, it can also have some limitations when it comes to sustainability and growth. It’s exciting to see how Legacy Collective is strengthening its infrastructure while also responding in creative ways to community needs—both activities bode well for the organization’s future and its potential to make a difference.”
Legacy Collective just received formal approval of their 501c3 status. And, they have ambitious plans for 2022. After growing their Legacy Giving Circle by 10% through an outreach effort in January, they are off to a great start. They are launching their first cause area-specific giving circle in partnership with The Real Mama Bears to support the LGBTQ community in March with a goal of 200 members within the first week. They also are hoping to gain 6 new corporate giving circle partnerships and their first 6 city giving circle partnerships this year.