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When celebrities are contemplating beginning their very own nonprofits — as such stars as Leonardo DiCaprio, Girl Gaga and Beyoncé have carried out — a myriad concerns come into play in figuring out whether or not it’s one of the best and best funding of an artist’s power and cash.
Movie star nonprofits have landed their founders in scorching water; in 2010, as an illustration, Wyclef Jean’s Haitian support group, Yéle Haiti, underwent legal investigations for accusations of fraud earlier than shutting down in 2012. In 2011, Madonna’s Elevating Malawi, a charitable basis that promised to construct a $15 million college within the southeastern African nation, notoriously mismanaged $3.8 million raised by way of donations, and the mission by no means broke floor.
To keep away from pitfalls, professionals who work with stars on charitable endeavors advocate taking these steps.
DO THE RESEARCH ON HOW TO AFFECT OUTCOMES
“I think there is often a tendency to sometimes let tactics or ideas come before outcomes. And so then you end up spending a lot of time and money and resources on, you know, PSAs that have a lot of really great celebrities in them but don’t actually get anybody to do anything,” says Greg Propper, co-founder of social influence agency Propper Daley. The extra profitable and protected method is to problem-solve backward, prioritizing how and the place to allocate funds earlier than asking for them in a public-facing business.
Together with his purchasers, who embrace John Legend, Kerry Washington and Shawn Mendes, Propper first asks what they care about and the outcomes they’re attempting to attain, then asks questions like, “What are the levers of change?”
Legend, as an illustration, wished to deal with the issue of mass incarceration and spent years on what Propper describes as a “multiyear listening and learning tour” visiting prisons and detention facilities and speaking with impacted folks. Taking the time to dive deep into the problems helped Legend turn into surgical about his recreation plan.
The philanthropy market is pretty crowded; there are some 1.6 million 501c3 organizations within the U.S. So creating a brand new one calls for that celebrities be distinctive of their method to addressing an issue. Analysis, together with hiring an adviser, helps stars scan the philanthropy house to search out gaps that aren’t but crammed.
Hannah Linkenhoker, senior political strategist at ICM Companions and co-founder of political influence company Vivify, says that expertise ought to critically think about lending their energies to present teams. “Los Angeles has one of the most robust philanthropic communities probably anywhere in the country,” she says. “We have incredible nonprofit organizations.”
She continues, “When a client comes to us and says ,’I want to start an organization,’ we go: ‘OK, that’s great. But let’s look at who’s out there doing work that’s exactly what you want to do. And let’s figure out if there’s a way to partner with them, if there’s a way to fold you into and support the work that they’re doing.”
BE EAGLE EYED ABOUT FINANCIAL ACCOUNTABILITY
Foundations are public trusts, in order that they require accountability, with the understanding that misuse of funds or being derelict in any approach may balloon into a serious legal responsibility.
“The public’s assumption is that you are going to be the fiduciary steward of their money and you’re going to do a good job with it. That’s a serious breach of trust if you don’t,” Propper says. Provides Linkenhoker, “There’s a lot of financial auditing, reporting and administrative work, and then you’re not paying taxes, so the government wants to ensure that you’re working in the public good.”
CONSIDER FINDING A HOST FOR A PHILANTHROPIC FUND
In lieu of going the route of making one’s personal nonprofit, Propper typically promotes the higher flexibility of utilizing a fiscal sponsor or a donor-advised fund. Legend, Washington and Mendes all have charitable funds or tasks fiscally sponsored by the Social Affect Fund; they appear to be foundations however are literally operated by a sponsor who already has a board and does authorized submitting, so there’s much less danger and labor for the star concerned. Likewise, the Entertainment Business Basis is a useful resource for creatives in leisure searching for to leverage their superstar for philanthropic influence. EIF hosts and manages nonprofits for a strong roster of such purchasers as Cher, Charlize Theron and Colin Kaepernick in order that navigating the labyrinth of beginning and working an initiative is a collaborative endeavor.
BE IN IT FOR THE LONG TERM
“I think it’s really easy to start a foundation; it is incredibly difficult to keep a foundation,” says Propper. “It’s hard to keep raising money, it’s hard to start and maintain your board. And if you look at the number of dormant funds out in the world started by folks in the entertainment community, there’s millions of dollars sitting in those funds not doing anything, because it’s hard to give away the money, and it’s hard to maintain the money.”
Concludes Linkenhoker, “I think that there are a lot of clients who come to it from a very well-intentioned place. But that doesn’t necessarily mean that the best outcome is starting and running your own organization.”
This story first appeared within the Nov. 22 challenge of The Hollywood Reporter journal. Click on right here to subscribe.
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