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With more than 40 years of advancement experience, mostly in independent schools, Mary K. Carrasco has seen a lot. She has led five capital campaigns, overseen development efforts at four independent schools, was an alumni and major gift officer at Virginia Tech and Georgetown University, and has served as a trustee on several boards including the Council for the Advancement and Support of Education. In June 2021, the Ursuline Academy alumna will be leaving her current post as assistant head of school for advancement at Sidwell Friends School (DC) to retire, leaving behind a wealth of industry knowledge and a legacy of what successful fundraising looks like. Independent School magazine caught up with her to talk about some of the most essential questions independent schools are facing—about the business model, equity, mission, the need for real investment in advancement—and fundraising’s critical role in answering them. She shares hard-earned insights and perspectives that will take fundraising into the future.Independent School magazine: You’ve surely seen many changes in fundraising over your career. Where is fundraising in independent schools going—and where does it need to go? What will it take to get there?
Mary Carrasco: So much has changed in terms of the tools available for connecting with alumni and parents, as well as the pace of communications. The fundamentals remain the same, which is that people give to people. And donors want to know that their gifts will have impact and are meaningful. More significantly, the conversation about the purpose of an independent school education is beginning to change in recognition of the origins of each school and why our individual independent school’s mission continues to be relevant—which means the case for philanthropic support will also need to change.
Schools have become more transparent about revenue and expenses, but parents and alumni still need to understand the school financial model. Advancement staff have an important role in this education process. Throughout my career, parents and alumni have believed that tuition was too high relative to the Consumer Price Index, and that is true now more than ever. There is a financial expression that “trees don’t grow to the sky,” so we need to be able to clearly explain the financial model. Working for Aiglon College, an international boarding school in Switzerland, I learned that parents who understood the financial model based on tuition dependence and the governance model of a volunteer board of trustees, and were educated about the need for philanthropic support, would likely become contributors. I think we should not take this understanding for granted in U.S. independent schools.
Advancement staff at independent schools have truly impressed me with their creativity and adaptability during the pandemic. We are engaging more parents and alumni, offering truly thoughtful activities, and accelerating the use of digital tools. I am confident that our alumni and parents will want to retain access to digital programs, and we will not return to previous programming as it was; rather, our schools will accelerate new engagement models that are more inclusive and relevant to our constituents.
Fundraising at its core is about creating enduring financial strength for our institutions so that our schools are able to deliver on their missions. What is required of schools to really invest in advancement so that school fundraising delivers on its mission?
MC: I once had the good fortune to work with a board chair who described advancement as “the power plant for the enterprise.” Tuition revenue cannot support all of a school’s aspirations and remain at a level that is accessible for the students we want to be able to attract and enroll. So we need to increase philanthropic revenue. To do so we need robust financial models with projections that quantify the impact of philanthropic revenue on operations through gifts for current use and gifts for endowment.
Because of limited resources, many advancement programs are focused on the top of the gift pyramid, where each gift will provide the strongest return on investment, and the bottom of the pyramid, so we have as much participation in school philanthropy as possible. The relationship with individuals whose gifts would be in the middle of the gift pyramid is often neglected. These donors are essential to building an active pipeline of future gifts. The ability to increase the number of relationships that will lead to a major gift proposal relies on the number of staff who can manage engagement and cultivation activities and use volunteers and campus partners effectively. These staff members need good management and access to professional development of their skills. And importantly, advancement staff need to be in active partnership with campus partners including trustee leadership. With board commitment and administrative leadership, our schools would have the advancement programs that create an active and ongoing pipeline of impactful gifts from donors at all levels.
With so much changing in the education landscape and so much more competition—new models for school and for learning—there’s an even greater need for independent schools to not just clarify their value proposition but to diversify their revenue streams. Is the independent school financial model broken?
MC: I’ve been thinking a lot about the independent school financial model, and I’m trying to imagine a different system. The Independent School Leadership Group (ISLG) recently had a conversation about the financial model using the query, “What’s next for the independent school model?” Are we “stuck” with only three levers to pull—tuition, philanthropy, and expenses? The pandemic has accelerated different models for learning. While the ISLG members agreed that parents and schools have a renewed appreciation for in-person instruction and the campus culture, some members predicted more experimentation with online and hybrid learning models to reduce costs and to increase revenue-generating opportunities. I’m intrigued by these discussions and by the schools that are thinking of new ways to reduce reliance on tuition revenue. I think one way would be to look more carefully at the expenses covered by tuition. If we are serious about our commitment to providing a values-based education, then perhaps we should ask how the programs that support these values are funded. What responsibility do alumni and the broader school community have for funding these value-based programs? For example, if a school community values an increased commitment to financial aid, then would the community of alumni and parents consider funding these increases from endowment, which is permanent and perpetual?
For many families, paying independent school tuition is already a major financial commitment and sometimes a strain. And when schools also reach out to parents for fundraising, it can be a hard sell. That has always been an inherent tension, but has it intensified even more recently? What can schools do to mitigate it?
MC: Any sustainable business model cannot be overly reliant on a single source of revenue. If schools are dependent on parents for tuition revenue and the majority of philanthropic revenue, that is a vulnerability. Schools benefit financially and culturally from having more alumni engaged in school governance and as volunteer leaders. Parents of alumni can also provide valuable perspectives and volunteer leadership. Creating meaningful engagement and leadership opportunities for more community members is possible when advancement staff have the commitment and cooperation of campus partners.
In the early days of the pandemic, when PPP loans were first making headlines, many schools found themselves needing to explain school finances to families in ways they hadn’t needed to before—in particular, endowments. Was this ultimately an opportunity for fundraisers to emphasize the importance of endowments and unrestricted giving?
MC: For a few moments we had the attention of our parents and alumni on school finances. We were given the opportunity to share details about the protection of endowment principal and the amount of endowment income designated for specific purposes. We were able to explain the importance of unrestricted gifts for current operations that was truly relevant in the moment. We were able to share details about the use of debt and philanthropy for capital projects. Most important, we could describe the importance of all gifts and philanthropic partners. Managing the pandemic has provided school leaders with an opportunity to emphasize the flexibility of annual fund gifts for current use and to more clearly make the case for endowment, which is permanent and perpetual. Usually, the case for current-use gifts resonates more with parents of current students, as the impact of these gifts is immediate, and the case for endowment resonates more with alumni and parents of alumni, as they have a longer horizon and want to ensure that the community’s values continue.
Perhaps one of the biggest implications from the racial reckoning for independent schools is the call to truly recognize their role as systems of privilege and inequity. The work to be done is deeper than access and affordability, bigger than diversity and inclusion. How do you think about this as it relates to fundraising?
MC: This reckoning provides independent school advancement leaders with the opportunity to rewrite our case for support and to truly diversify the community of support. The recent Winter 2021 issue of Independent School magazine provides thoughtful and helpful perspectives that we can use to frame the racial reckoning conversations in our schools with our advancement staff. No other work is as important. We won’t be able to address the financial model unless we address what author Gustavo Carrera calls the “raison d’être of independent schools” in his article, “This Time is Different (and Other Fairy Tales).” He posits that “our main job is to preserve the social status quo or reproduce the elite; this class-bound purpose results in a hierarchical view of the world in which our students are destined for leadership … a kind of noblesse oblige, a worldview that accepts and perpetuates existing social hierarchies while promoting social good.” The piece builds to this essential point: “We need to stop worrying about providing an illusory ROI and ensure that we help our students develop lives of meaning and purpose; we need to stop worrying exclusively about leadership and prepare them for ethical and active citizenship.”
This is the case for philanthropic support. We can’t just change a few words here and there. We need to rethink why we need philanthropy as part of our financial model. Let’s not be reluctant to ask what is appropriate to include in tuition pricing and what would be more appropriately funded from philanthropy; to ask how we can make permanent and perpetual our school’s values through endowment funding, and how philanthropy will ultimately advance our students’ journeys to becoming ethical and active citizens.
As schools move forward and manage all the necessary change work that’s going to have to happen, who will lead the way? How can schools accelerate their paths for growth?
MC: Schools need to engage more of our younger alumni in change work. It makes sense to include those individuals who have had the positive and negative experiences at our schools and who have demonstrated our shared values in their personal and professional lives. Finding more opportunities for students to participate in determining school culture will have a lasting impact. The opportunity for alumni and students to make these connections can be magical.
Philanthropy is not just for a few people. School philanthropy requires the entire community to participate if we will be successful and express our personal and collective commitment to the values our schools represent. I have enjoyed my work for independent schools because I can connect our alumni to solutions for nearly all of our society’s problems: climate change, medical research, hunger, income inequality, social justice, and more. These interests often begin when they are students on our campus. The spark is lit, and students become alumni who are scientists, public health experts, community organizers, advocates, capital creators, and problem-solvers of all types.
As you look back on your career, what have been some of the highlights—what’s brought you the greatest joy, kept you going? Do you have any parting words for school fundraisers as they navigate the road ahead?
MC: I have the greatest joy when volunteers and donors realize that they can achieve even more than they imagined possible. I have been inspired by school heads who have had a bold vision and an extraordinary talent for engaging volunteer leadership in realizing a shared set of goals. What has motivated me to keep going is a complete respect and awe for great teaching and the incredible individuals who are dedicated to young people and to helping students to develop the confidence and curiosity needed to achieve their greatest aspirations. When I reflect on why independent schools have been the focus of my career, it is because of the importance of great teachers. Advancement professionals who stay grounded in the belief that education changes lives and is necessary for our society will be successful and will ensure that independent schools prepare students for ethical and active citizenship.