Venture Philanthropy Partners: Investing in Social Change.

April 2007

Wed, 2007-04-04

From VPP

Strategic Assistance: The Secret Sauce

We often hear from our investment partners that the combination of financial and strategic assistance that they receive from VPP is one of the most valuable aspects of the relationship. The money side of this equation is clearly understood, but the strategic assistance part more often is not. What is strategic assistance and how does it work?

Strategic assistance starts with establishing a trusting relationship between us and our investment partners. This trust has to be earned on both sides and takes time to build. One of the advantages of making multi-year investments is that we have the time to build and nurture these relationships. More »

Three New Board Members Named

Venture Philanthropy Partners has elected three new directors to its Board: Nigel Morris, Co-Founder, Capital One Financial Services; Michele Hagans, real estate developer and executive; and David Bradt; Managing Director, Wealth and Tax Advisory Services, McLean, Virginia office. More »

In This Issue

President's Perspective

Strategic Assistance: The Secret Sauce


Three New Board Members Named

David Sylvester Joins Team

In the News







From VPP

Strategic Assistance: The Secret Sauce

Carol Thompson Cole

We often hear from our investment partners that the combination of financial and strategic assistance that they receive from VPP is one of the most valuable aspects of the relationship. The money side of this equation is clearly understood, but the strategic assistance part more often is not. What is strategic assistance and how does it work?

Strategic assistance starts with establishing a trusting relationship between us and our investment partners. This trust has to be earned on both sides and takes time to build. One of the advantages of making multi-year investments is that we have the time to build and nurture these relationships. We try to develop an open "give-and-take" with our investment partners where there is a climate that allows for complete honesty and where both parties know that neither will run from a problem no matter how tough. Both parties have to say what they mean and mean what they say and be willing to make some very challenging decisions.

On our end, we have to avoid being overbearing or imposing our aspirations, our vision, our milestones, or our biases. We always must remember that it is their organization, not ours; they have to own and live with their decisions and actions. We must remain respectful of the challenges they face, the work they do, and the difficulties encountered when trying to transform their organizations. As we become invested in the success of our investment partners, one of the greatest challenges is simultaneously acting as champions for the organizations while keeping the objectivity and distance that allows us to be effective advisors. We have to stay strategic in our advice and not jump in and try and "do" things for our nonprofit partners, particularly since our goal is to enable them to build their capacity to the point where they can sustain their new growth without our support.

For our investment partners, this relationship means changing their whole frame of reference with regard to the way they work with funders. We don’t just give organizations money and wait for a report. We are at their sides to help them meet their vision and goals and work through a variety of management issues, many of them quite daunting. For some leaders, this can be difficult. They are more used to a dynamic of "Just give me the money and leave me alone" or "Just tell me what you want to hear" and aren’t accustomed to having this kind of relationship with a funder. It takes time for them to actually feel they can come to us with their challenges and that we will roll up our sleeves to help.

We work to strike a balance between our results-oriented practice, the expectations for meeting milestones, and the quick achievement of goals versus the realities of the time it takes for transformative change, the resources that the investment partners have to enact and absorb such change, and the work they are doing on the front lines that doesn’t stop during all this growth.

We have no cookie cutter approach to strategic assistance, no formulaic process. It can be as simple as asking questions that our investment partners have never before had time to ponder, like when a VPP partner asked Maria Gomez, President & CEO of Mary’s Center, "What’s your dream? Where do you want Mary’s Center to go?" Or as specific as picking up the phone and arranging a meeting between an executive director like Sandy Dang of Asian American LEAD and a county executive in Maryland as she prepares to expand into a new location. Strategic assistance is about helping source board members and senior staff members. It’s about coaching an executive director through making tricky decisions. When an organization is hiring a search firm for the first time, VPP gives advice on how to run a professional search. Renegotiating loans, identifying sites for expansion, opening the doors to potential partnerships—all of these efforts are part of our day-to-day work at VPP. But most of all, it’s about getting close enough to the investment partner and so trusted by its leadership that, as we can see the subtleties and nuances of the issues within the organization, our insights will be valued.

The partners on VPP’s investment team have the years of executive experience to help support and guide our investment partners and their boards through the process of transforming and growing their organizations. They know the National Capital Region inside and out and can make connections to individuals, agencies, organizations, funders, and corporations that enrich and enhance the networks in which their nonprofit partners operate. They are skilled at managing complex operations, situations, and negotiations and help VPP’s portfolio organizations craft memorandums of understanding and relationships with new partners.

And most important, they understand what the executive is experiencing because they have "been there and done that." They have made the mistakes and often have the scars to prove it. They also know what success looks and feels like. The challenge is to be an influencer and not a supervisor so a real partnership is developed and they become a trusted advisor.

In the business world, management assistance is readily available—at a cost—from a variety of sources. It is accepted that a part of doing business is obtaining assistance from experts such as attorneys, management consultants, search firms, and others to build an infrastructure that will support the company’s leaders and its goals.

In the nonprofit world, access to this kind of advice is harder to come by. Nonprofits are expected to serve a social good but not spend time or precious resources on thinking about how they could achieve their mission in bigger or more efficient ways. When this type of support is available, it is in limited quantities and focused on a few narrow areas, such as development and finance. Nonprofits rarely get to look at their organizations strategically and holistically. But just like a business, nonprofits need to source exceptional executive talent, need to be sure they have the right people in the right seats on the bus, need executive coaching, have to manage change within their organizations to meet changing external realities, need to be able to plan for the future, and so on.

Strategic assistance enables nonprofits to make maximum use of the resources they have and position themselves to grow. Strategic assistance coupled with the financial support is helping take our investment partners and the communities they serve to new levels.

- Carol Thompson Cole

Editor's Note: The President's Perspective column by Carol Thompson Cole debuts in this issue. She and Chairman Mario Morino, via his Chairman's Corner column, will alternate most months in writing about topics of interest in philanthropy, the broader social sector, and the learning and experience of Venture Philanthropy Partners.

Three New Board Members Named

Venture Philanthropy Partners has elected three new directors to its Board: Nigel Morris, Co-Founder, Capital One Financial Services; Michele Hagans, real estate developer and executive; and David Bradt; Managing Director, Wealth and Tax Advisory Services, McLean, Virginia office.

"With the addition of these three prominent players, we are adding significant talent to our already strong Board. Each of them are highly successful in their respective careers, are well regarded by their peers and colleagues, and bring invaluable and relevant skills, experience, and relationships to help VPP move forward into its next phase of growth and development. And, critical to our work, they are passionate about improving the lives of young people in our region and committed to the work and approach of VPP," said Board Chairman Mario Morino.

Morris brings demonstrated performance in building CapitalOne into a market leader as a co-founder and its COO, skill and contacts in financial services and financing, a rigorous critical thinking, and a strong commitment to philanthropy and social change. Hagans brings executive experience and contacts to better tie VPP and its investment partners into the real estate and building industry in the National Capital Region as well as a working knowledge of the region that will round out VPP's ability to navigate regional issues and systems. Long affiliated with VPP, Bradt has deep expertise working with high-net worth families, a strong background in tax, finance, and accounting expertise, and a track record of civic engagement and leadership.

These additions are a part of a larger transition that VPP is taking to strengthen and grow its own organization and Board to be more effective. Actions have been taken to broaden Board leadership, with Les Silverman, Jack Davies, Artis Hampshire-Cowan, and David Bradt all stepping forward to lead key Committees. It also plans to establish Board task forces to work with the team and outside experts to tackle long-term strategic issues. And, over the next nine to twelve months, VPP plans to recruit five to seven additional Board members to further augment its collective capacity.  

David Sylvester Joins Team

VPP announced that David Sylvester has joined its team as Partner. Sylvester, a venture capital attorney who has been involved in a number of civic and community-based activities, including economic development rebuilding efforts in his hometown of New Orleans, will lead a number of VPP investment partnerships and complement the overall capacity of the VPP team of investment professionals.

"David brings to VPP the wonderful combination of his passion, skills, experience, and conviction to seeing the lives of young people improved. His deep understanding of and contact network in the business, venture, and nonprofit worlds will greatly add to VPP’s capacity and directly benefit the nonprofits in which we invest. And, David’s experience sitting 'across the table' in his work with Heads Up, VPP’s first investment, gives him a wonderful appreciation of our investment approach and a keen understanding of the financial and organizational challenges enterprises face as they seek to grow and expand their offerings," said Carol Thompson Cole, President and CEO of VPP.

Art Marks, General Partner, Valhalla Partners, LP and a VPP investor said, "David Sylvester brings an unusually rich and appropriate background to VPP. He is a native of New Orleans, trained as a lawyer, and understands a great deal about building organizations and working with leaders. On a personal level, you rarely meet people like David who are both extremely talented and extremely humble at the same time. David is empathetic and direct. He is a joy to work with."

For 24 years, Sylvester was an attorney whose practice included advising private and public companies in the areas of early through late-stage venture capital financings, public offerings of securities, mergers and acquisitions, securities law, and general corporate law. In 2000, he established the Northern Virginia office of Hale and Dorr, LLP now Wilmer, Cutler, Pickering Hale and Dorr, LLP, where he was instrumental in connecting early stage companies in the region with venture capital financing and assisting later stage companies in accessing public capital markets. Companies he assisted include CareerBuilder, OTG Software, Proxicom, and Ciena. Prior to joining Wilmer, Cutler Pickering Hale and Dorr, Sylvester worked with Silicon Valley companies such as Electronic Arts and Apple Computer at the firm of Fenwick & West in Palo Alto.

VPP investor Rick Kay, the founder of OTG Software and now President, Strategic Management Consultants, LLC, commented on the expertise Sylvester brings to VPP: "I’ve known David since 1995 when he personally helped my company navigate all the complex steps involved in going public. I would not be where I am without his advice and counsel. He will be a tremendous asset for VPP as his years of management experience have given him a quiet confidence that people have a tendency to follow. If he can do for nonprofits what he did for my company, the children of the DC region will be better off."

Throughout his career, Sylvester has been active in the community. A New Orleans native and former New Orleans public housing resident, he has spent the last year working on both informal and formal rebuilding efforts in the hurricane-damaged region, spending a week a month in that city. He serves on the Board of Governors of the Isidore Newman School and the Board of Directors of The Idea Village Inc., a nonprofit business accelerator, both in New Orleans. He is a past president and current member of the Board of VPP investment partner Heads Up. He is also a past president and former member of the Board of Directors of the AHC, Inc., a private nonprofit organization that provides low- and moderate-income housing to more than 6,000 residents in the Mid-Atlantic Region. In addition, Sylvester has served as pro bono General Counsel to the Midnight Basketball League, Inc. and the National Association of Midnight Basketball Leagues, Inc.; a former member of the Board and General Counsel to the Mid-Atlantic Venture Association (MAVA); and a former member of the Executive Committee of the Arlington, VA, chapter of the NAACP.

Sylvester holds a Juris Doctor degree from the University of Virginia School of Law and a Bachelor of Arts from Stanford University.

In the News

WUSA Channel 9 News featured VPP and the Boys & Girls Clubs of Greater Washington during its "JC & Friends" segment, hosted by JC Hayward, on March 23. The clip is available on the WUSA9 website.

Entrepreneur Weekly, a regional business and entrepreneurial community newsletter published in partnership with the Northern Virginia Technology Council, featured VPP’s leadership transition, in "VPP 2.0’ – Legendary Mario Morino Hands the Reins to a New Generation."

Investment Partner Updates

Expansion Actions

Heads Up LogoHeads Up Charts Expansion to Neighboring Counties, Older Students
Thanks to Sara Brandspigel, Development Manager, for this update.

Heads Up is embarking on several initiatives to expand the organization’s impact on children and college students in the Washington, DC, area. In late 2006, the board of directors completed a strategic plan that set the direction for the organization's development over the next five years. Under the plan, Heads Up will continue an emphasis on serving elementary school students in DC, while extending its signature tutoring program beyond the city’s borders and developing new supports for older students.

As DC undergoes redevelopment and a spike in property values, more of the region's low-income families are settling beyond the city. In response, Heads Up plans to expand its after-school and summer program for elementary school students to neighboring counties.

"This demographic shift presents an opportunity for Heads Up to serve more low-income kids while tapping the large population of college students on the city’s borders for our tutors," said Darin McKeever, Executive Director.

Heads Up’s strategic planning also revealed opportunities to serve older students. Heads Up will create a program for middle school students in the District to ensure the continuity of academic support for the graduates of its elementary program. This will deepen the program’s impact on students by helping them transition to new schools and face the challenges of adolescence.

During 2007, Heads Up will secure partnerships and resources to support these initiatives. Meanwhile, the organization will maintain the focus on measuring impact that has been key to Heads Up’s first decade of success.

Management Changes

SEED to Add Director of Expansion to Team
Thanks to Elizabeth Frazier, Director of Communications, for this update.

The SEED Foundation plans to add a Director of Expansion to its senior leadership team. This position will have the responsibility of establishing the SEED school model in new locations, as well as continually refining SEED’s overall expansion strategy and start-up process. Further information may be found on the SEED website.

Programs & Services

LAYC logoCFNC Part of Preschool Pilot Opportunity
Thanks to Kate Lyng, Manager of Development, for this update.

In recent months, the Child and Family Network Centers (CFNC) and other local early childhood education advocates have witnessed the evolution of Virginia Governor Tim Kaine’s proposed Start Strong initiative. In December of 2006, the Start Strong Council released a report that found that increased investment in early childhood education was linked to greater school readiness, higher school achievement, and strong employment opportunities, with implications for economic returns in the future. Upon careful consideration of these findings, the Governor’s office distributed a request for proposals for a grant initiative that would allow six communities to serve as pilot projects, serving four-year-old children with high quality preschool services through collaborative ventures in public and private settings. Governor Kaine proposed funding to test the feasibility of a Quality Ratings System used to assess these pilots in 2007-2008.

Although the budget approved by the 2007 Virginia General Assembly includes $2.6 million in funds for preschool pilots, Governor Kaine’s original proposed initiative was not fully funded. Budget language was added that authorized the Department of Education to "enter into agreements" with "those school divisions that have existing partnerships with private and/or nonprofit providers as of the 2006-2007 school year," limiting eligible pilot communities to 11 localities that had reported such partnerships to the Department, including Alexandria, where a majority of CFNC’s programs are located.

The move towards awarding funding to localities with existing collaboration signified a strong commitment on the part of lawmakers to support communities in which a more integrated, systemic plan for early childhood education is already in place. The Start Strong initiative will build upon the existing, state-funded Virginia Preschool Initiative (VPI) and focus on increasing the quality, consistency, and strength of Virginia’s preschool network, while increasing access to students who will benefit from the school readiness services. Currently, out of 188 children participating in VPI in the city of Alexandria, 145 of those children are enrolled at CFNC. As a result of its proven track record of excellent outcomes in early childhood education, Alexandria submitted a letter of intent in mid-March.

College Summit LogoPrince George’s County Public Schools Gets Early Morning Start on College-Going
Thanks to Tom Harrison, Marketing and PR Coordinator, for this update.

In February, Prince George’s County Public Schools took an unusual step in its effort to systematically increase college-going—it served breakfast. Over an early morning buffet at C.H. Flowers High School, six area high school principals, invited by Chief Academic Officer Shelly Jallow, met with College Summit staff to discuss implementation strategies for the nonprofit’s college-planning curriculum and other services.

College Summit’s staff came prepared to facilitate a discussion among the school leaders. The formal agenda quickly gave way, however, when the principals of C.H. Flowers, Crossland, and Laurel High Schools (currently in partnership with College Summit) were asked to share their thoughts with the school leaders of Suitland, Deval, and Oxon Hill High Schools (schools about to enter into partnership).

Principal Helena Noble-Jones of C.H. Flowers singled out the value of the College Summit Summer Workshop that helps students complete the college application maze and trains them to guide their peers to do the same during the school year. "Our students are teaching other students how to write essays and now they are better writers."

In the casual setting, principals even shared their challenges. One school leader described the difficulty of improving the average GPA of his student body. Although he wishes to raise the percentage of students with a 2.0 or higher from 47% to 75%, he acknowledged it was a struggle to convince students that a 'C' was not good enough.

Principals expressed their belief that the services and support offered by College Summit bolsters such efforts. "College Summit helps to change culture; it changes the conversation among my seniors," added Noble-Jones.

Principals being introduced to College Summit asked direct questions. "How do you pick the right peer leaders?" Oxon Hill High School’s Assistant Principal Pamela Jones asked. Her colleagues assured her that the application process would help pick the right students to become peer leader and that these peer leaders would serve as lightning rods for college-going back in the classroom.

The breakfast, also attended by Prince George’s County Public Schools officials Dr. Pamela Shetley and Patricia Miller, underscored the public school system’s belief in its own form of peer leadership—its principals serve as effective guides for successful College Summit partnerships.

Partnerships & Alliances

AALEAD and CCBA Partner in DC's Chinatown
Thanks to Rosetta Lai, VP for Development and External Affairs, for this update.

In April, AALEAD will begin to deliver the Family Strengthening Program and the After-School Academic Enrichment Program in the heart of DC’s Chinatown. Beneath the thriving commercial revitalization of a once Chinese ethnic neighborhood are pockets of Chinese immigrant families in need of AALEAD’s services. AALEAD will run parenting workshops, community meetings, counseling sessions, and other programs in the CCBA office building. The partnership with CCBA, one of the earliest historic service organizations for Chinese immigrants, will harness the strength and experience of both organizations and leverage the synergy to achieve optimal outcomes for the benefits of the low-income Chinese community in that neighborhood.

Awards & Recognition

Heads Up logo

LAYC’s Art & Media House Honored at Mayor’s Arts Awards
Thanks to Jim Whitney, Director of Communications, for this update.

LAYC's Art & Media House was recognized for its work at the 22nd Annual Mayor's Arts Awards held at the Kennedy Center on Monday, March 19. The Art & Media House was one of three finalists in the Innovation in the Arts category, which honors individuals and organizations that demonstrate "ingenious use of skills or resources to produce art, art programs, or services."

The recognition at the event, attended by more than 1,000 people who care about the arts and hosted by WAMU radio host Kojo Nnamdi, underscored the varied programming youth can access through the Art & Media House, including drawing, graffiti art, mixed media, painting, photography, beatmaking, music recording, Photoshop, video production, hip hop, and DJ.

While LAYC has a rich history in the arts dating back to the late 1960s and early 1970s, it was just two-and-a-half years ago that LAYC opened its Art & Media House, a facility dedicated to arts and media. At this new facility, young people are exposed to art and media, discover the power of self-expression, and explore issues facing the community.

Announcements of Note

CMHS Receives DC Task Order, APA Award
Thanks to Dennis Hunt, Executive Director, for this update.

On March 20, CMHS received a Human Care Agreement Task Order from the DC Department of Mental Health for the provision of Medicaid-reimbursable mental health rehabilitation services, including diagnostic/assessment, individual & group medication/somatic treatment, individual & group counseling, community support and community-based intervention, and intensive day treatment. With the funds made available through this Task Order, CMHS will be in a better position to fill a critical gap in the provision of mental health services for traumatized DC youth. Services will be provided at the offices of the CMHS Core Service Agency located at the Covenant House Washington headquarters in Southeast DC, and at other community sites in the District in the near future.

CMHS has been selected as one of four agencies/professionals to receive the 2007 American Psychiatric Foundation (APA) Award for Advancing Minority Mental Health. The award will be presented at the annual APA convention in San Diego in May. According to a press release, “The awards recognize psychiatrists, other health professionals, mental health programs and other organizations that have undertaken innovative and supportive efforts to: 1) Raise awareness of mental illness in underserved minority communities, the need for early recognition, the availability of treatment and how to access it, and the cultural barriers to treatment; 2) Increase access to quality mental health services for underserved minorities; and 3) Improve the quality of care for underserved minorities, particularly those in the public health system or with severe mental illness.

Mary’s Center Taps Honorary Co-Chairs for "Noche Tropical"
Thanks to John Alejandro and Lyda Vanegas, Department of Advocacy and Communications, for this update.

District of Columbia Mayor Adrian M. Fenty and his wife Michelle Cross Fenty have agreed to be honorary co-chairs of Mary’s Center’s annual gala, “Noche Tropical,” to be held on September 28 at the Ronald Reagan Building.

"I am looking forward to working with Mary’s Center to broaden the services it provides to residents of the District," said Michelle Fenty. "The ability to provide quality health care and related services to those in need is a goal we need to achieve."

Recently, Mrs. Fenty toured the facilities of Mary’s Center and was briefed on programs such as the federal nutritional program, housing counseling services, and education and family literacy programs. During the tour, Mrs. Fenty visited with staff and clients, taking the time to hear their stories and connect with them one-on-one.

"The health and well-being of our citizens is an indicator of the general condition of our city," noted Mayor Fenty. "In order for the District of Columbia to continue to prosper, we must enable our citizens to be productive by taking a more expansive view of the term 'health care.' "