Sraying the Course

Few institutions — colleges, universities, foundations and large nonprofits — that rely on investments to generate cash for current operations and to underwrite future growth have escaped economic whiplash in recent years as the stock market tumbled and the economy stalled: The Mott Foundation has been neither immune to, nor isolated from, this experience. Our assets rose dramatically in the 1990s, growing from $1,162 billion in 1992 to $3,227 billion in 1999. This near tripling of resources supported an even more robust level of growth in our grantmaking — from $49 million in 1993 to $153 million in 2000. The end result of this growth is that during the past four years the Foundation has given away almost one-third ($506 million) of the total grant dollars ($1.6 billion) we have awarded in our 76 years of operation. We had viewed the equity market expansion of the 1990s as a unique and unsustainable phenomenon. Unfortunately, we did not have a clear understanding of, or appreciation for, the many forces that would buffet the market in the years that followed. With the clarity of hindsight, we realize we should have taken a different path than the one we chose. (fragment)