Kim SmithJournal #1
I just finished my first week interning for the Robin Hood Foundation. The mission of the organization is to fight poverty in New York City by finding and funding the best and most effective programs and partnering with them to maximize results. Robin Hood’s philosophy is that to significantly affect people living in poverty you have to attack its root causes. That is why the organization focuses on poverty prevention through programs in early childhood, youth, education, jobs and economic security. The board pays all administrative, fundraising and evaluation costs, so 100% of donations goes directly to organizations helping New Yorkers in need to build better lives.
Robin Hood is very results-focused. The organization created metrics to compare the relative poverty-fighting success of similar programs. However, Robin Hood also wanted to compare the effectiveness of dissimilar programs. As a result, Robin Hood uses metrics that capture the poverty-fighting effectiveness of each grantee on a common scale, allowing comparisons of any one to another.
My project is focused on determining whether program-related investments (PRIs) fit within Robin Hood’s mission and organizational structure. A P.R.I. is similar to a recyclable grant: the repayment of a loan or the return of equity can eventually be recycled for another charitable purpose. While generally structured as below-market loans, PRI’s also include loan guarantees, lines of credit, or equity investments. PRI’s are used when an organization has a revenue stream that can be a source of repayment.
This project will be challenging. Robin Hood is a grant making organization. The money raised in one year is then given out as grants the following year. For the past 20 years, this model has worked. However, PRIs have many benefits including increasing the total asset pool available for grant-making because the interest is received annually and the principal is returned and recycled over time.
Journal #2
I am now about halfway through my internship. To better understand whether PRIs fit within Robin Hood’s structure, I have met with consultants, government agencies, foundations and investment vehicles. Recently, I presented to Robin Hood’s staff about my research thus far. My presentation included the pros and cons of PRIs and illustrating through examples when they are most effective.
I have also been fortunate to meet with both potential and current grantees. This has enabled me to see the impact Robin Hood’s grants have had on the over 200 organizations it supports. I have also learned about the type of due diligence Robin Hood does before making a grant.
Lastly, I have been to two conferences/workshops focusing on PRIs. These experiences have enabled me to meet others in the field while also learning about PRIs and how other foundations utilize them.
Journal #3
It is hard to believe that I am in my last week of interning at Robin Hood. My experience this summer has been wonderful.
My project was focused on determining whether program-related investments (PRIs) fit within Robin Hood’s mission and organizational structure. Through my research and meetings with other foundations, I made a short- and long-term recommendation to Robin Hood.
My short-term recommendation is for Robin Hood to pursue recoverable grants. They are closely related to PRI’s as they provide the return of capital under specific circumstances. A primary advantage is the simplicity of the transaction. The documentation is quite similar to that of a traditional grant and requires no more than a modified grant agreement.
In the long-term, I recommended for Robin Hood to pursue a revolving PRI loan fund. PRI’s are effective tools in achieving Robin Hood’s mission of fighting poverty in New York City. A revolving PRI fund is sustainable as the interest is received annually and the principal is returned and recycled over time.
Robin Hood has and continues to stand out for the impact it has made in fighting poverty in New York City. Adding PRI’s to its arsenal will allow Robin Hood to have an even greater effect on the communities and the people it serves.
