Excerpt of Interview from Winter 2018 issue of Philanthropy magazine
Russ Carson grew up in Toledo, Ohio, attended Dartmouth, and then found himself in New York City to attend Columbia Business School. Awed by the big city, he planned to graduate, work downtown for a few years, find a wife, and move back to the Midwest.
Fifty years later, he’s still in midtown, but now as a successful private-equity investor and active philanthropist. With his wife Judy and two children, he runs a non-bureaucratic, New York City-focused foundation. Using judgment honed by his years assessing leaders of businesses, Carson handpicks investments that he thinks will yield good social returns. Philanthropy met with Carson in Manhattan to learn more about investing in people, promising biomedical research, his Catholic-school deal with Cardinal Dolan, and how a bustling city became his philanthropic passion.
Philanthropy: You’re in the private-equity business. What distinguishes a successful private-equity firm from a mediocre one?
Carson: In a word, returns.
I started my firm, Welsh, Carson, Anderson & Stowe, with two partners almost 39 years ago. The first partnership that we put together raised $33 million, which we thought was all the money in the world. Since then we have raised over $20 billion in capital, through 16 different limited partnerships over time. So part of the answer of what makes a successful firm is consistency, of being in business over a long period of time, and developing good relationships with your limited partners to effectively become a trusted source of investment. Ultimately the partners have to transition the firm to the next generation of leadership. We’ve successfully done that, which is something we’re very proud of.
Philanthropy: Do you think any of those challenges and skills translate to successful philanthropy?
Carson: Absolutely. For our first ten years we were financing start-ups and early-stage ventures. We were heavily dependent upon entrepreneurs. That experience has been enormously valuable to me in the philanthropic world. In venture capital you invest in people, not in businesses or ideas. For me, the same thing is true in philanthropy. The number one thing for me is finding really good people who are doing something interesting that fits within the framework of what our foundation wants to do.
Read the full interview here.
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In venture capital you invest in people, not in businesses or ideas. For me, the same thing is true in philanthropy.
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