Thursday, May 14, 2009

Charities Rethink Glitz Quotient for Their Galas

A recent Wall Street Journal article explored how you throw a famous Wall Street gala fund-raiser when conspicuous consumption and investment bankers are no longer cool. As the article relates:

The Robin Hood Foundation faced that issue on Tuesday when it held its annual benefit in Manhattan. A year ago, the antipoverty charity's dinner included the auction of a trip to Australia to scuba dive and have lunch with Hugh Jackman. It went for $420,000. This year, the only prizes offered at New York's Javits Center were things like opportunities to feed hungry families, enroll children in charter schools and teach new parents to care for newborns.

"Consider this ... your Yom Kippur," quipped host Jon Stewart, referring to the Jewish Day of Atonement. "You're going to donate a lot of money. Not enough, obviously, to offset all the s- you've done, but a lot."

The toned-down event reaped nearly $73 million, topping last year's $56.5 million haul. Robin Hood, founded by hedge-fund manager Paul Tudor Jones II, used some Wall Street-style financial incentives to motivate giving in a potentially tough year: Financier George Soros and Robin Hood's board of money managers and corporate executives joined forces to match contributions dollar for dollar from guests' tables during a scaled-back auction. Tables donated about $28 million during the auction, and ticket sales for the event generated another $17 million.

As New York's first spring gala season since last year's market crash kicks into gear, all sorts of charities are facing a difficult juggling act: They need to tone down the glitz to respect the terrible economy and the bubbling anger toward Wall Street excess. But they still need to stage high-profile events to attract wealthy donors.

A bad night can seriously dent a charity's ability to maintain its programs. "For many nonprofits, a gala could be 25% of their annual income, and those dollars aren't going to come from somewhere else," says Melissa Berman, president and CEO of Rockefeller Philanthropy Advisors. This year, she says, charities are trying harder to frame their events as "people coming together to help those less fortunate" to avoid the perception of "a bunch of clueless, thoughtless people drinking too much."

Project Sunshine, a New York charity that provides services to hospitalized children, plans to cut down on corporate signage and honor several volunteers instead of individual donors at its benefit later this month. (It does plan to honor a corporate donor.) But the charity will still auction a weeklong Caribbean trip and dinner with Kristen Dalton, the recently crowned Miss USA.

City Harvest, which distributes food to New York soup kitchens and pantries, shared the costs of its April benefit with another nonprofit. It also did away with large floral centerpieces and seating cards with fancy calligraphy. But donors could still bid on dugout seats to a Los Angeles Dodgers game. Rock star Rob Thomas performed. City Harvest's haul: a bit over $1 million, down slightly from $1.3 million in 2008. Read more here.

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