MacKenzie Scott’s philanthropic approach – giving large, unrestricted gifts – has made headlines in recent years. What can everyday givers learn from this strategy? Phil Buchanan, president of the Center for Effective Philanthropy (CEP), and Lisa Ratliff, CEO at KaBOOM!, explored this question at the 2023 We Give Summit session: Advancing Equity Through Large, Unrestricted Gifts: A Study of MacKenzie Scott’s Giving. 

In 2020, Scott announced that she had given $1.7 billion to 116 nonprofit organizations in the form of massive, unrestricted grants. CEP studied the impact of these grants in its report: Giving Big. 

“These gifts are transformational,” Buchanan said, noting that unrestricted funding helped “organizations advance equity, specifically racial equity.” 

According to CEP’s research, the recipients of the grants reported “that it was helpful in advancing [the organization’s] mission and support organizational capacity.” 

KaBOOM!, a national nonprofit working to end play inequity, was a recipient of one of those grants. 

Prior to this gift, “philanthropy was stuck in a model where funders were restricting what organizations could do with funds, so we were inching along in our mission,” Ratliff said.

KaBOOM! had imagined what it would look like if it had unlimited resources, and Scott’s gift allowed KaBOOM! to put its plan into action. The organization was able to invest in staff, research, and a policy team to better understand the system and study the existing infrastructure for kids.

“We could start influencing our federal, local, and state government to start thinking about equity-based play,” Ratliff said.

Additionally, Scott’s approach marks a departure from traditional philanthropy as her grantees are more racially diverse, with 55% of grantees self-identifying as white compared to 75% of foundation grantees. Buchanan asked Ratliff,  “How has this grant affected you as an affirmation of your role as a leader?”

“As a Black woman and an adult who benefited from many of our public systems … the work I do is very personal,” Ratliff said. “I never imagined I’d be leading a nonprofit. I always experienced the undertone of not being good enough … on a very personal level, having someone call and say, ‘Hey, we’re going to give you this gift … whatever works for you, we believe in your leadership’; it was the most powerful thing anyone had ever said.”

Ratliff hopes Scott’s strategy helps inspire a shift in donors’ attitudes towards unrestricted giving. Ratliff described Scott’s approach to giving as “beautiful because she talks about giving her wealth back to the society that generated it.” 

Lessons for All Donors

While most donors do not have the same capacity to give as Scott, her approach helps dispel common myths about unrestricted giving and provides useful lessons for other individual donors. 

“Commit. Commit to learning and listening and recognizing that there is probably a lot more to the issue that you care about,” Ratliff said. “Look into the roots of the problem and think about how you can use the wealth in your life to support this.” 

Buchanan reminded attendees that “strong programs cannot exist in weak institutions.” When donors trust organizations proximate to the issues, they make a real commitment that is grounded in “I want something to change” with the understanding that you may not be able to solve that problem, but that there are organizations that know how to allocate these resources.