A Night to Remember

By Stephanie Ellis-Smith

Last week was a monumental week for the team at Phīla and it was capped last Thursday night in the best way possible—winning an award!  

First, a little backstory to set the stage. Lauren and Mark led a beautiful family board meeting that shepherded in a new generation to giving, Sofia returned from Abu Dhabi where she attended the AVPN Global Conference representing one of our clients, and Janell was in New York to attend Women Moving Millions. Meanwhile, I was in DC to attend the board retreat for the National Center for Family Philanthropy. But on Thursday, I did a Joe Biden and took my first the Acela trip from DC to New York to meet up with Janell. Needless to say, it’s been HECTIC for team Phīla.

Stephanie and Janell holding the Philanthropy Advice Award

Janell and I met up that evening to join many of our outstanding peers in New York City to attend the Family Wealth Report Awards. This black-tie event at The Mandarin Oriental Hotel was a stunner. The moment we got off the elevator on the 36th floor, the buzz from the crowd was practically deafening! People we’re clearly pumped to be there.

We were seated at a table of incredibly interesting people: an art advisor, personal insurance executives, and, most interesting, two product leads for a company that automates work-flow processes for alternative investments. (It’s like a different language). When our name was called, everyone at our table erupted in applause and grabbed our phones to capture photos of the moment that I get to share with you here. What an experience!

This award recognizes the best of professionals in North America serving ultra-high net wealth clients. We were honored to receive the award for our innovative, client-centered approach to philanthropic advising. Our team, clients, and partners recognize the distinctive quality of our approach—and now, so do many more. This high praise would not have been possible without the unwavering care and commitment of my team and the trust and collaboration of our incredibly generous clients.

Since our inception in 2017, we have been on a relentless pursuit of excellence, guided by a vision to help donors be active participants in creating a more just and equitable world. Phīla Engaged Giving is proud to be among the leading lights in the field working to shape philanthropy into a life-giving and equity-centered practice. We look forward to celebrating more victories with you.

Reflecting on Six Years of Impact: Phīla's Journey to 2023 in Numbers

Man in silhouette overlooking body of water

By Stephanie Ellis-Smith, Founder and CEO

As we approach the end of 2023, we find ourselves compelled to reflect on the milestones and metrics that define our road to success. At our core, we measure success not just in numbers, but in the lasting impact we create for both our clients and the communities they serve. Let's dive into our year by the numbers, highlighting the quantitative and qualitative aspects that shape our narrative.

Quantitative Impact

Assets Under Influence (AUI): $2.8B

While we don't manage funds, we proudly guide charitable assets; we call them "Assets Under Influence" (AUI). As of December 2023, our AUI stands at an impressive $2.8 billion. This figure represents the combined philanthropic resources of our clients that we have the privilege of influencing for the long term, shaping the landscape of giving for generations to come.

Growth: Steady and Sustainable

Sustainability isn't just a buzzword for us; it's a key metric. Over our six years in operation, we've experienced a sustainable revenue growth of 30% year over year. This growth is a testament to our commitment to making a lasting impact in the philanthropic landscape AND being a role model for building a successful Black-owned business. We’re here for the long haul.

Client Portfolio: Expanding

From our humble beginnings of serving four clients annually, we've evolved into a dynamic team guiding well over a dozen clients each year while keeping our bespoke service level high. This expansion not only speaks to the quality of our services but also reflects the growing demand for our unique approach to philanthropic advising.

Service Offerings: Dynamic

Our steady growth has allowed us to offer our clients so much more now than when we began. In addition to our bespoke advisory service, which remains core, we now offer grants management, executor services for charitable estates, and most notably the Phila Venture Fund. The Fund is our new 501c3 entity that is able to host donor collaboratives, fiscally sponsor client-driven initiatives, and act as a re-grantor for private foundations.

Team Growth: From 1 to 8

In 2017, I was a solo practitioner and since then, we've flourished into a formidable team of eight. This expansion reflects our shared commitment to our mission and our responsiveness to the evolving complexities of the philanthropic terrain, ensuring a more impactful and tailored approach for our clients.

Increased Giving by Clients: $100M

The impact of our work is evident in the increased giving by our clients. From 2020 to 2023, we've mobilized over $100 million in new giving and assisted 12 clients in establishing brand new giving areas centering equity. These numbers underscore our ability to inspire and guide transformative philanthropy.

Qualitative Impact

Adoption of Equity-Based Practices: 100%

Beyond the numbers, we care deeply about HOW our clients give. A remarkable achievement for us is that 100% of our clients have adopted trust-based and power shifting practices. This includes embracing participatory grantmaking models, adopting a values-based approach to giving (i.e., giving beyond c3s to investing in individuals, c4s, and politics), making multi-year general operating support grants, simplifying grant processes, minimizing reporting requirements, and actively seeking input from grantees.

Thought Leadership

Sector Influence: Rising

Our impact extends beyond individual clients. In the last year alone, our perspective has been sought after by more than 15 different philanthropic sector organizations, networks, and major wealth advisory firms--as keynote speakers, facilitation experts, and trend spotters. This recognition underscores our thought leadership in the sector. As an example, you can listen to Senior Advisor Janell Turner expertly talk about the intersection of our work and the financial sector in this podcast.

Active Followers: Growing

Our commitment to sharing insights and knowledge is evident in the growth of our community. We currently have 894 subscribers to our monthly newsletter, Insights in Philanthropy, serving as a platform for sharing valuable information and fostering a sense of community among philanthropic stakeholders. Our subscribers are curious donors, nonprofits, foundations, professional advisors, and estate attorneys all keen to broaden their sector knowledge.

Social Media Engagement: Trending

While the exact numbers may vary, our impact on social media is substantial, with thousands of impressions and reposts. Our digital presence on LinkedIn and Instagram allows us to amplify our message, reaching a broader audience and influencing conversations in the philanthropic space. 

Who We Are: Diverse

Our team's diversity is not just a statistic; it's our greatest strength. Comprising 100% women, over 66% BIPOC, 25% LGBTQ, and with a growing presence in the Midwest, our team brings a dynamic awareness of the grantseeking side, acting as a bridge between donors and doers. This diversity fuels innovation, empathy, and a richer understanding of the multifaceted challenges within the philanthropic landscape.

Looking back makes me excited for the future! 2023 is a narrative of growth, impact, and a steadfast commitment to transforming the face of philanthropy. As we step into the future, we carry these achievements with us, knowing that each number represents a life touched, a community empowered, and a step toward a more inclusive and impactful world. Thank you for being a part of our journey.

Tax Cuts, Jobs Act and Philanthropy: My Take

Welcome to 2018!

As I reflect on the events of the last twelve months, I find myself focused on the Tax Cuts and Jobs Act of 2017, passed just before the New Year dawned, and its impact on philanthropy. The bill, which provides the most comprehensive revision of the tax code in decades, left many scrambling to understand the newly wrought changes and their implications.

Giving is a deeply personal act. Most donors do not cite tax implications as the primary motivation of their philanthropic activities.  Instead, key drivers of philanthropy tend to be rooted in personal values, an organization’s mission, and a desire for social change. That said, we cannot ignore the role the IRS plays in how we translate our assets into an expression of generosity. Phila Engaged Giving supports legislation that fosters and encourages philanthropy in making meaningful financial gifts to organizations that best align with their interests. We will track and monitor all legislation impacting philanthropy and continue to report our findings here.  

As the weeks and months unfold, we will gain a clearer picture of how the new bill will impact the philanthropic sector. In the meantime, there are a few certainties. Below is a bird’s-eye view of tax code changes and how they might affect philanthropic giving and you as a donor.

The Charitable Deduction

Despite fears leading up to the passage of this bill, the philanthropic community was relieved to find that the Charitable Deduction remained intact under the new tax code. As before, you may deduct charitable contributions of money or property to qualified organizations if you itemize your deductions. For some making large donations, the new code may even provide further benefit; for example, the maximum amount for charitable gifts deducted from a donor’s gross income increased from 50% to 60%.

The Standard Deduction

The Standard deduction taxpayers can take without itemizing each of their charitable gifts during the year was doubled from $6,000 to $12,000 for individual filers and from $12,000 to $24,000 for couples. The expansions will likely increase the number of taxpayers choosing the standard deduction rather than itemizing those gifts. Charities fear that the modification has the potential to disincentivize charitable giving, especially for those giving between $1,000 and $10,000 a year, because people who no longer choose to itemize their deductions may also decide not to donate to nonprofits. The effect of the modification of the Standard Deduction is the new tax code’s greatest unknown in terms of impact on charitable giving.

The Estate Tax

Like the Standard Deduction, the Estate Tax was doubled from $11 to approximately $22 million for couples, which shields all but the very wealthiest from the tax. Previously, the estate tax served as an incentive to the wealthy to donate parts of their estates to avoid a penalty. While its absence has the potential to impact larger charitable gifts, this is far from certain, as the overall tax environment with respect to philanthropy remains positive. We will have a clearer picture of the positive or negative impact on charitable giving in the months to come.

Donations of Appreciated Assets

The rules that allow people to donate appreciated securities and other assets to charities to avoid capital gains taxes did not change.

Donations from Individual Retirement Accounts (IRAs)

The rules on charitable donations made from IRAs remained intact; however, donors may revisit these kinds of gifts, which now appear more attractive relative to other options. People over seventy and a half must still make minimum distributions from their IRAs and are taxed on the amount they use; however, they are able to donate up to $100,000 to charity tax free while still counting for the minimum distribution. That begins to sound like a good decision when compared to leaving an IRA in your estate at death.

Donor Advised Funds (DAF)

There are no changes in the new tax code that impact Donor Advised funds. Donors who experience a liquidity event or otherwise have a high taxable income in one year, however, can as before contribute multiple years’ philanthropic giving into their DAF. This enables them to receive a tax deduction for the entire sum at one time while still benefiting from the standard deduction in years following.

Our deep desire to share with others our good fortune may be simple, but – sadly - can get caught in a web of rules and regulations. I hope this brief summary of some of the changes and implications of the Tax Cuts and Jobs Act of 2017 on philanthropy will spur new thoughts, insights, and conversations about your plan for giving in 2018. While its impact is still unfolding, my take is that the net result of the modifications will be neutral for most donors.

As always, I suggest that before you make a final decision on your philanthropic program, you consult with your planning team, including your financial, tax, and philanthropic advisors; estate planning attorney; and insurance brokers, to ensure that the change in the tax code results in a compassionate and thoughtful deployment of your charitable funds that best serves you, your family and your community.

Please feel free to contact us at Phila Engaged Giving if you’d like help understanding the evolving community needs resulting from the introduction of the new tax code. We are happy to assist you as you navigate your philanthropic path forward.

Here’s wishing you a Happy and Prosperous New Year!