When Mark Zuckerberg, Facebook’s founder and chief executive officer, announced from Oprah Winfrey’s couch two years ago that he would donate $100 million to Newark, N.J., schools, there was little indication from the crowd’s cheers and grins from Newark Mayor Cory Booker and New Jersey Gov. Chris Christie just how complex the process of spending that money would be.
Mr. Zuckerberg’s donation was a challenge grant, meaning Newark could only spend a dollar of his money once it received a dollar from someone else. And all the money is collected and allocated through the Foundation for Newark’s Future, a nonprofit organization with a wide variety of stakeholders on its board of directors and only a five-year window for raising and spending the money. Plus, the money can be spent only on six focus areas determined by the foundation’s board: early-childhood education, out-of-school youths, teacher quality, Common Core State Standards implementation, school options, and community engagement.
So far, about $50 million has been raised (and, thus, matched, putting $100 million at the foundation’s disposal) and $16 million spent.
In a recent interview with Education Week, Gregory Taylor, the president and chief executive officer of the Foundation for Newark’s Future and a veteran of large national foundations, discussed how to manage those moving parts within the new landscape of high-stakes philanthropy.
So how exactly do the donation and the allocation work?
So first, what was really important from our perspective: that the new philanthropy was not to use or draw from existing foundation dollars to unlock the Zuckerberg money. Newark is struggling like many urban centers for philanthropic dollars. We didn’t want to take money from existing community-based organizations because we had this challenge.
There’s two ways in which money comes into the fund. First are direct contributions to us as an organization, and then as those dollars come in, they are then matched [through Mr. Zuckerberg’s donation], and we use the revenue to invest in those six strategies and promising programs in Newark. The second is that it has to be specifically focused in Newark.
So when money is put into a teacher-development program that we think is quality, the dollars that the donor has put into that organization would also unlock matching money from our fund. And then those unlocked dollars are distributed between the six strategies that we’ve talked about.
What’s the relationship between the state, which controls the school district, the foundation, the school system, and the mayor? How are all those people influencing the decisionmaking?
The state, the mayor, philanthropies, and others, we certainly work very closely in partnership, but we’re an independent organization with our own governance board like any other foundation. And so, ultimately, the dollars that are invested are approved after our staff brings compelling and thoughtful investment opportunities to the board to decide.
This is true of a lot of urban districts, but Newark’s budget is in bad shape. What are the conversations like around using this money to fund stopgap measures to get the district’s budget in better shape, rather than trying to fund things like innovation or reform?
None of our investors, nor I, would be interested in throwing good money after bad, so there’s no desire to fill stopgaps. But we did provide a very significant grant to a financial audit, we funded a significant grant on the human-capital-pipeline issue, and out of that comes learning and lessons that provide a road map for improving the district’s operational excellence. We’re not funding stopgaps to fix roofs on buildings or replace textbooks, even though those are critically important infrastructure expenses.
But the notion that we can tighten up the financial gaps in the systems in place and the management structures is a really prudent investment. I do get asked a lot to help with stopgaps, both from parents and school principals and our incredible fundraisers, but we’re trying to stay at the systems level.
How do you raise money?
You have people who say, “Wow, I want to be a part of that.” So if you look at our track record, that’s where our initial dollars came from. It helps that you have someone as magnanimous as Cory Booker helping to do that.
Then you have a second wave of funds from investors who are contributors and want to see plans, want to see leadership in place, and want to “test it as you go” to make sure what you’re working toward is both realistic, thoughtful, and well-planned. So that’s the second wave of investment, and again, if you look at our track record, that also happened.
I do think you have to have really compelling, thoughtfully presented ways in which progress is measured and articulated, and folks can understand how their influx of cash can move you to the next level. It’s always difficult to raise money, particularly in this environment, but I think we’ve been relatively successful adhering to that road map.
What’s Mark Zuckerberg’s level of involvement at this point?
He recognizes that he’s not an educational expert. He is completely hands-off; he has a little company to run called Facebook. We certainly keep him abreast of our work and progress to date, but his involvement is intentionally hands-off, and I admire him for that. I know a lot of times people who give donations feel like it entitles them to a level of expertise they may or may not have, and I think he’s very thoughtful about that. He thinks, “I’m going to hire educational experts, let them do their jobs, but be clear about the direction that they’re going.”
Read the entire interview with Gregory Taylor on the Marketplace K-12 Blog.
Coverage of the education industry and K-12 innovation is supported in part by a grant from the Bill & Melinda Gates Foundation.
A version of this article appeared in the August 29, 2012 edition of Education Week as Q&A: How Facebook Money Is Used for Newark Schools