Values, capacity for growth and long-term stability become the centerpiece of its new fundraising analysis.

TROY, MICHIGAN – In a speech on July 12 to representatives of some of the nation’s most selective private colleges and universities, Rip Rapson, president of The Kresge Foundation, outlined the rationale for expanding the foundation’s strategic direction beyond its longstanding method for funding nonprofit organizations, the capital challenge grant program.

“The cumulative impact of the Kresge challenge grant model has been unquestionably beneficial,” Rapson told those attending a conference at the University of Richmond. “But it carries with it some serious limitations.”

Rapson made the case for a more assertive philanthropic sector nationally and described the increasing need for nonprofit investment capital – “social venture capital,” as he called it. He also argued that now more than ever private foundations have an obligation to try to remedy the ever-widening schism between the haves and the have-nots.

“The realization that Kresge’s extraordinarily precious foundation dollars could more effectively be called into battle against these trends” prompted the Board of Trustees and staff to reorient the foundation to do exactly that, Rapson explained.

Read the full text, “New Directions, Venerable Traditions: A Case Study of Change at the Kresge Foundation.”

The Kresge Foundation is concentrating its efforts in four broad areas:

• Recasting the capital challenge grant program
• Promoting a broader spectrum of nonprofit capitalization strategies
• Advancing selective fields of interest
• Contributing to the revitalization of distressed communities, beginning with Detroit and the surrounding region.

At the center of the reorientation was a “values lens,” Rapson said, through which all grants were now being evaluated. He identified seven values:

• Low-income opportunity
• Community impact
• Institutional transformation
• Risk
• Environmental conservation
• Innovation
• Diversity

“How these values play out will vary dramatically from one field to another,” he said. “Low income access means one thing in health care and another in arts and culture. Investing in environmental sustainability may be an indefensible expense for a homeless shelter but a routine expectation for a private college.”

The long-term goal of The Kresge Foundation, he concluded, was to use its “flexible resources and multiple tools to explore the kinds of interdisciplinary, multi-sector solutions demanded by the scale and seriousness of contemporary problems.”