What he doesn’t want to do is endow something that is going nowhere.
“Suppose they are not that good at what they are proposing or suppose the money doesn’t do any good. Then I’m stuck with that endowment money sitting there, I would rather give them operating money, let’s try it for a couple of years, see if we can make a big impact, and see if it works.”
Wendy Woods, senior partner at the Boston Consulting Group and the global leader of the firm’s social impact practice, said there are different advantages and disadvantages on whether to fund endowments or make high-impact gifts.
“The short-term funding model usually gets more funding to the organization faster,” Woods said in an e-mail. “From the perspective of the individual giving, they can best direct and focus the use of their funds. They get to see more of the benefits, the difference that their gift makes — that also often creates a willingness to give more. The difficulty becomes if the donor’s goals for the organization are not well-aligned with the path, the strategy of the board and the leadership of that organization.
“In terms of an endowment, the benefit is that this creates longer-term stability for the organization,” Woods wrote. “The opportunity to create good now is usually more limited ... but the ability of the organization to thoughtfully plan and deliver consistently over a period of time is greater.”
Rubenstein has no foundation. No adviser. No staff. He wants his results now.
“I just think of what I want, and then I do it.”
Like when he took pity on the musicians at Baltimore City College, where he attended high school, and whipped out his checkbook on the spot and gave them $100,000 for new musical instruments.
To handle formal requests, he schedules one-on-ones on Saturday mornings — when he is not on Carlyle time — at the Four Seasons Hotel in Georgetown, where those seeking gifts are given an hour to make their case.
Solicitations for his money come from far and wide — he once was asked to fund a Nebraska library — and are often masked as a “request for advice.” One letter-writer asked for $50 million to endow a charity on the basis that his father was a guidance counselor at Rubenstein’s Baltimore high school.
Although he cops to having an ego and doesn’t mind adulation that comes with his name on the buildings at Duke University, Johns Hopkins University and elsewhere, he get satisfaction just meeting the parents of Washington high school students who have received Rubenstein-funded college scholarships from the Economic Club of Washington, which he chairs.
After he a concludes a short exegesis on the origin of the word philanthropy, which comes from the Greek “loving humanity,” Rubenstein sits back at his office conference table and defines his own philanthropy.
“I give money, because I recognize that’s part of the game. Two, I give my time. And third, I wanted to do something I learned to do at Carlyle, which is to help [organizations] raise money.”
At the moment, he is chairing or co-chairing six major national fundraising campaigns at Harvard University, the University of Chicago, the Smithsonian Institution, the John F. Kennedy Center for the Performing Arts, the Kennedy School of Government (again at Harvard) and the National Trust for the National Mall campaign.
He is hoping some of his fundraising skills rub off on the organizers of those groups. After all, the Rubenstein money trough will not be around forever.
Some day, he won’t be around. And like the good financial engineer, his philanthropy is a hedge even on his afterlife.
“Though you cannot buy your way into heaven, why take a chance?”