Bill, Hillary and Chelsea Clinton raised $200 million in 10 months for their foundation’s endowment, positioning the nonprofit to survive even if its cash-collecting namesakes engage in a 2016 presidential run.
With four-fifths of their $250-million target in the bank, they are also changing fundraising strategies to include small donors -- a tactic that would create a list that could be politically useful, as well.
The Clintons’ initial appeals for foundation money were to contributors who could give $1 million or more. Those answering that call included Irish cell phone billionaire Denis O’Brien, and Bill Austin, owner of Minnesota’s Starkey Laboratories. Others were charities founded by Mexican billionaire Carlos Slim Helu -- the world’s second richest man -- and one run by Chicago venture capitalist J.B. Pritzker and his wife.
“As with many of the nation’s leading non-profit organizations, an endowment will provide the Clinton Foundation with the permanent capacity to support established and new programs and responsibly plan for the future,” Craig Minassian, the group’s chief communications officer, said in an e-mail.
The race to build an endowment is a sign that the foundation is maturing, that 67-year-old former President Bill Clinton won’t always be able to serve as its chief rainmaker, and that the time for Hillary Clinton, 66, to settle the question of her presidential ambitions is running out, said three people involved in the endowment project who asked for anonymity because they weren’t authorized to speak publicly about the fundraising effort.
The foundation’s officials are compiling a list of investment management firms to maintain the fund, and will soon put out a request for proposals, a foundation official familiar with the strategy said.
Establishing and funding the endowment now is important because a return by the Clintons to the political stage will also require a shift from generating cash for the foundation to financing the campaign, said those involved in the current fundraising drive.
That shift in status, from private to public life, also would mean the couple could be subject to conflict-of-interest charges if foundation donations are sought from those with interests before the federal government.
Also, raising an endowment prior to a presidential run will ensure the foundation doesn’t starve a potential Clinton super-political action committee, said Craig Holman, the government affairs lobbyist for Public Citizen, a Washington-based watchdog group. Super-PACs that can raise and spend unlimited amounts of money didn’t exist during Hillary Clinton’s failed 2008 bid for the Democratic presidential nomination.
“Historically, many of the people who could give to a Clinton Foundation would have maxed out to the Clinton campaign,” Holman said. “Now they can throw all that money at the candidate herself.”
U.S. law bans foreigners such as billionaires Slim and O’Brien from contributing to political campaigns, so a potential Clinton campaign wouldn’t be competing for their dollars.
During the 2008 presidential primary campaign, then-Senator Barack Obama tried unsuccessfully to pressure the Clinton Foundation to reveal its donors. As part of the deal struck for Hillary Clinton to join Obama’s administration as secretary of state, the foundation agreed to disclose its contributors.
The backers of the endowment will be listed along with other supporters in annual public disclosures going forward, according to a foundation official.
At a minimum, the Clintons simply wouldn’t have the time to nurture the endowment or foundation in the midst of a presidential campaign. If she runs and wins, the foundation could be deprived of their fundraising prowess for a decade.
The fundraising drive will be a hot topic of hallway conversations today when top donors -- including some who wrote checks for the endowment -- gather at Goldman Sachs Group Inc. headquarters in Manhattan for the organization’s annual spring briefing on programs.
The Clintons’ urgency is evident in the speed at which they have been generating donations.
“Most small or medium foundations wouldn’t be able to raise that kind of money in a year,” said Reina Mukai, a research manager at the New York-based Foundation Center, which tracks philanthropy. “It’s fairly unique.”
In September, the foundation will hold a $1,000-a-head reception at the Italian Embassy in Washington. For $25,000, a couple will be able to dine after the reception with Bill and Hillary Clinton at the Washington home they’ve kept. A check for $50,000 includes dinner and an invitation to the New York-based foundation’s next donor conference.
Bill Clinton, advised by longtime aide Doug Band, created the Clinton Foundation shortly after leaving the White House in 2001. In 2012, it took in $54.7 million in revenue and ended the year with $183.6 million in assets. Its endowment, though, was just $292,000.
In the past dozen years, the foundation sprouted 11 separate arms, from the Clinton Global Initiative to Hillary Clinton’s “Too Small To Fail” project, which was founded in 2013 to improve the health of children younger than 6 years old.
Whether or not Hillary Clinton runs for president, foundation officials said it makes sense to set up a mechanism for building the family’s legacy “in perpetuity.”
One Clinton confidant described a maturation process at the foundation that made an endowment a natural move.
In its early years, this person said, the foundation was more like a start-up, trying to figure out how to make it each year. More recently, its officers have begun considering how to make sure it can endure for decades.
While the $250 million level may secure the operation of existing programs, it hardly puts the Clinton foundation in the same league as those with the names Ford, Gates or Rockefeller attached to them.
The Bill & Melinda Gates Foundation, for example, reports having an endowment of $40.2 billion -- 160 times the size of the Clinton Foundation’s goal. At $32.7 billion, Harvard University ranks first on the list of major college endowments.
The Clinton goal compares more closely to the size of the endowment of former President Jimmy Carter’s Atlanta-based foundation, which reported having a $460 million endowment in 2011.
The success of the Clinton fundraising drive marks a turnaround for a foundation that, according to the New York Times, was rife with disorganization and incurred about $40 million in deficits in 2007 and 2008. Bill Clinton disputed the account.
Still, in 2011 the foundation contracted with the New York-based law firm Simpson, Thacher & Bartlett LLP to audit finances and policies. Recommendations included: hold regular staff meetings, review expense reports, and adopt a gift acceptance policy “to ensure that all donors are properly vetted.”
In July, the Clintons reorganized its staff, removing Chief Executive Officer Bruce Lindsey from day-to-day management and installing Eric Braverman from McKinsey & Company in his place.
As the foundation announced those changes, Bill Clinton added a request. “We need an endowment,” Clinton said in Aug. 13 open letter posted on the foundation’s website “which our family and friends are working to raise.”