A $200 Million Endowment Focused on Black Americans Is Taking Shape

Started in 2020 as a five-year initiative inspired by the racial justice outcry following the police murder of George Floyd, the California Black Freedom Fund recently announced it is here to stay, with plans to create a $200 million endowment. The move is both rare in the world of philanthropy and politically bold, given the Trump administration’s efforts to eliminate race-based grant making.

Originally a designated fund of the Silicon Valley Community Foundation, the fund spun off on July 1 as a separate community foundation — renaming itself the Black Freedom Fund — with a goal to build a sizable Black-led endowment. Over the past five years, the fund has drawn more than $97 million in donations, essentially meeting its original $100 million goal. Of that, it has directed $45 million to 206 nonprofits in California, largely working to increase the sway of nonprofits that serve Black people, with a portion of the balance being reserved to start the endowment.

For donors who want to steer their money directly into politics or businesses, the fund also plans to create a 501(c)(4) social welfare organization (which allows for more political giving than 501(c)(3) nonprofits), an investment LLC to invest in private companies, and a political action committee.

Marc Philpart, the fund’s executive director, said the endowment will let the fund make grants of $10 million a year without cutting into its asset base, assuming historical rates of return on investments.

By establishing a durable institution with a sizable reservoir of cash, the fund can serve as a lasting beacon to smaller organizations serving Black communities in California, Philpart said.

“When a crisis occurs in the Black community, philanthropy parachutes in, there’s a wave of support, and then as soon as the news cameras turn away, the support recedes,” he said. “We need enduring institutions that are led by and committed to the Black community in ways that have a lasting impact.”

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Philpart’s fundraising for the planned endowment comes as the Trump administration has characterized diversity, equity, and inclusion programs as illegal and has called for investigations of large foundations that support diversity programs.

Under Philpart’s leadership, the California Black Freedom Fund started the Legal Education, Advocacy, and Defense for Racial Justice Initiative, which provides pro bono legal consulting and training for nonprofits. The program operates based on the belief that there isn’t anything illegal about racial justice funding.

The 2023 Supreme Court ruling against considering race in college admissions in a pair of cases brought by Students for Fair Admissions against Harvard University and the University of North Carolina was viewed by some as an indication that private philanthropies could not legally engage in race-based grant making — and the issue is far from settled.

While some corporations and philanthropies, including the Chan Zuckerberg Initiative, an early supporter of the California Black Freedom Fund, have retreated from supporting racial justice, Philpart is counting on securing support from donors who want to stay with the cause even as the issue is argued in various court cases stemming from Trump’s anti-DEI executive orders.

The attacks from the administration, Philpart said, have been a “clarifying moment” for many donors and have generated interest in the fund.

“People have rallied to us and really doubled down on their commitments to support Black freedom and Black power,” he said. “That is the most telling thing coming out of this moment — that there is a critical mass of leaders throughout the country who care very deeply about the community.”

One grant maker that has doubled down is the California Wellness Foundation. The foundation made an initial grant of $500,000 when the fund was first launched, then made a $200,000 commitment to a separate fund created by the California Black Freedom Fund in response to the January Los Angeles fires, and recently added $500,000 to support the spin-off.

Richard Tate, president of the California Wellness Fund, said the new fund is “needed now more than ever” because of attempts by the administration to roll back equity efforts.

“The fact that we are talking about a Black Freedom Fund is an acknowledgment that not everyone has equal standing in the culture,” he said. “Whatever headwinds that may exist because of this political moment, now is the time for us to continue to be explicit about our intentions of supporting a community.”

Leroy Hamilton

The Need for Philanthropic Speed

Philanthropy needs to act quickly by unleashing more money in grants to support areas like litigation, public advocacy, and the replacement of lost federal funds, said Glenn Harris, president of Race Forward, a nonprofit racial justice advocacy group. But, he said, lasting institutions that can respond to future challenges are also needed.

“There’s a balancing act,” Harris said. “It’s really clear that struggles for liberation and justice are going to be with us for a minute.”

Among the two dozen grant makers that chipped in to start the fund are the Akonadi, Conrad Hilton, and San Francisco foundations, as well as the Emerson Collective, Crankstart, the Evelyn and Walter Haas Jr. Fund, and the Silicon Valley Community Foundation. The total of institutional funders to the effort since 2020 now exceeds 70.

A big reason the California Wellness Foundation has given $1 million is that larger foundations that support a range of causes often lack connections among movement-based grassroots organizations in the state, said Tate, CWF’s president.

“The Black Freedom Fund becomes a partner and a conduit to reach some of those smaller organizations,” he said.

Those groups include the East Bay Permanent Real Estate Cooperative, a community-owned cooperative that “removes land and housing from the speculative market and places it into permanent community stewardship,” according to the fund.

Over five years the group has “liberated” seven properties and helped direct more than $8 million in capital to businesses and grassroots organizations led by Black and Indigenous people and other people of color.

Another grantee, the Black Wellness & Prosperity Center in Fresno, has scored policy wins, including a statewide increase in Medi-Cal reimbursement rates for doulas, almost doubling the previous rate paid by the state per birth.

A late 2023 survey of nearly 300 foundations conducted by the Center for Effective Philanthropy found that more than two thirds of grant makers did not offer endowment grants. Half of those that so did made them to arts organizations and museums.

Nonprofits led by Black people receive endowment grants even more rarely, according to a 2022 analysis of social change organizations by the Bridgespan Group, a philanthropy consultancy, which found that nonprofits led by Black people had endowments that were only a fourth as big as those led by white people.

Since then, some grant makers have stepped forward to support endowments at organizations serving members of Black communities, said Darren Isom a partner at Bridgespan. For instance, in 2022 the Robert Wood Johnson Foundation made grants of $5 million each to three racial justice organizations led by people of color: UnidosUS, the NAACP, and Faith in Action.

Often, Isom said, foundations treat grantees like vendors and give grants to nonprofits that satisfy requirements developed by the grant maker. By contributing to the fund, Isom said, foundations are providing resources to groups that “own the thinking” behind the work.

“Endowments are transfer of power from philanthropic organizations to the organizations that are closest to the work,” he said. “From an impact perspective, the work is more high impact, more beneficial, and more durable if it’s owned by and led by those that are the closest to issues and closest to the communities.”

Isom hopes the Black Freedom Fund, whose California-focused predecessor inspired similar funds in other places, including Maryland, Minneapolis, and Seattle, can last. Though he said the country was living through a period of “extreme chaos,” especially in regard to racial issues, he pointed out that the NAACP and the Schomburg Center for Research in Black Culture were created early in the 20th century at a low point in U.S. race relations.

Philpart, the fund’s executive director, is confident that despite the blow-back against diversity and racial justice, the fund can raise enough money to meet its goal.

“We’re drawing people out who want to prove we are greater than divisiveness, we are greater than bigotry, and we are a greater than racism,” he said. “We are better than all the things that pull us apart and don’t fundamentally improve anyone’s well-being.”