The Full Current of Capital: Aligning Grants and Endowment to Advance Mission

# Why this matters

# The tidal foundation idea

# Public purpose in practice Marguerite Casey Foundation (MCF) and New York Foundation (NYF) frame philanthropy as supporting public systems rather than replacing them. MCF's Public Dollars for Public Good strategy supports organizing and efforts to unlock public funding. NYF's Public Purpose Framework for Philanthropy describes three roles foundations can play:

• Partnership: bring together government, philanthropy, and communities around shared priorities.
• Capital: provide flexible, catalytic funding to fill timing or credit gaps.
• Power: support organizing so communities shape priorities and hold institutions accountable.

These three roles can be combined depending on the opportunity.

# Where the approach is concrete: housing and child care Housing and child care are practical examples where organizing, public policy, and finance intersect.

• Housing: As rent-stabilized buildings change hands, tenant organizing aims to preserve affordability and advance community stewardship. Public partnership can align funding and policy to make preservation viable. Foundations can supply flexible capital to bridge financing gaps when conventional lenders or public funds aren't available or move too slowly.

• Child care: MCF provided a $3M grant to the Child Care Action Fund (an initiative of the Mayor's Fund to Advance New York City) that supports partnership around expanded public investment. Organizing by families, workers, and providers helps shape expansion, while philanthropic capital can cover upfront costs, facility needs, or shortfalls in public funding so providers can participate in a scaled public system.

# How integrated capital works Integrated capital means combining or sequencing different forms of capital—grants, program-related investments, loan guarantees, or direct investments—based on what a specific opportunity requires. The sequence is driven by community priorities and the public policy context. Foundations can use grants to support organizing and technical assistance, then deploy flexible capital to bridge timing or risk gaps, and finally use program-related or market-rate investments as projects stabilize.

# Implications for boards and investment committees Boards should rethink the artificial separation between payout policy and investment policy. Questions they should consider include:

• Does the endowment's mandate or investment policy allow for mission-aligned investments or flexible capital deployment?
• When does the opportunity to advance mission justify higher near-term payout or use of endowment capital in nontraditional ways?
• How will partnerships with government and community groups shape the mix and timing of capital?

Answering these questions requires connecting financial capacity, mission urgency, and on-the-ground opportunities.

# Bottom line The tidal foundation model reframes stewardship so both spending and investing are judged by how well they support public purpose. When foundations coordinate grants, investments, and influence with community power and public systems, they can move public dollars more effectively and help communities set and enforce priorities.