Operations
Staff and financial resources are important to monitor for smaller foundations who are looking to grow, and for larger foundations who are looking for the flexibility to diversify their offerings.
Revenue mix
Administrative fees assessed on funds are the primary source of revenue for community foundations and will be for the foreseeable future, though differences in revenue mix are observed in different asset size cohorts. Smaller community foundations, on average, depend more on direct fundraising to support operations and internal operating endowment/reserve distributions than larger foundations. Some diversification can be observed at individual community foundations seeking alternative means of funding, which in turn support emerging efforts such as community leadership and special initiatives.
All respondents
- Administrative
fees - Fees for service
- Fundraising
operations - Fundraising
programmatic - Distribution from
endowment/
reserve - Other revenue
| Size of foundation | Administrative fees | Fees for service | Fundraising: operations | Fundraising: programmatic | Distribution from endowment/reserve | Other revenue |
|---|---|---|---|---|---|---|
| $0-$25M | 63% | 1% | 15% | 5% | 11% | 4% |
| $25-$50M | 68% | 0% | 11% | 5% | 10% | 6% |
| $50-$100M | 70% | 1% | 10% | 5% | 10% | 4% |
| $100-$250M | 78% | 1% | 6% | 3% | 8% | 4% |
| $250-$500M | 78% | 1% | 4% | 6% | 4% | 6% |
| $500M+ | 73% | 3% | 4% | 6% | 5% | 8% |
| All | 71% | 1% | 9% | 5% | 8% | 5% |
Operational expenses
Differences in the proportion of personnel to non-personnel expenses are relatively minor when comparing community foundations of different sizes. Insofar as differences do exist can be observed in smaller community foundations, which may have very few staff.
All respondents
- Personnel
expenses - Non-personnel
expenses
| Size of foundation | Personnel expenses | Non-personnel expenses |
|---|---|---|
| $0-$25M | 64% | 36% |
| $25-$50M | 63% | 37% |
| $50-$100M | 67% | 33% |
| $100-$250M | 68% | 32% |
| $250-$500M | 69% | 31% |
| $500M+ | 68% | 32% |
| All | 66% | 34% |
Surplus vs. subsidy
Fewer respondents reported expenses that were in excess of revenues earned (14%) than FY 2016 (22%), while just under half of all respondents reported surpluses. Gaps between revenues and expenses are typically covered by unrestricted funds, though this has an effect on the flexibility of a community foundation’s business model, including their ability to invest in foundation-operated initiatives and leadership.
- Significant subsidy
- Modest subsidy
- Breakeven
- Modest surplus
- Significant surplus
| Significant subsidy | Modest subsidy | Breakeven | Modest surplus | Significant surplus | |
|---|---|---|---|---|---|
| Surplus vs. Subsidy | 6% | 12% | 33% | 31% | 18% |
Expense to asset ratio
Economies of scale at larger community foundations generally drive expense-to-asset ratios down, though it should be noted that individual operating models have a major influence on this metric. There are community foundations across the field that are interested in increasing their investment in community leadership, which would be one factor in increasing this ratio for many.
Field median: 1.2%
Funds per full-time equivalent
Larger community foundations tend to maintain relatively complex operating models. This, coupled with larger and more specialized staff, is reflected in those staff managing fewer funds.