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A Few Minutes With Patrick Westerlund, Education & Impact Investing Consultant, Tony R. Wells Foundation

Patrick Westerlund
Education & Impact Investing Consultant, Tony R. Wells Foundation
614-335-5009 ext. 703

In March 2017, Tony Wells and Patrick Westerlund of The Wells Foundation traveled to Pittsburgh to speak to a sold out audience of nonprofit and philanthropic leaders at a Nonprofit Talent Good Ideas Forum about social impact investing. As a follow up to this engaging session, Patrick shares his perspectives on how foundations and nonprofits can begin to deploy this investment strategy.

How Foundations Can Prepare Existing Grantees Or Partners To Accept Impact Investments.

When the concept of social entrepreneurship first arose, one of the most difficult problems was finding and obtaining financing to start and grow these new ventures. Today the idea of a ‘social business’ is increasingly part of the social sector vernacular, and the situation seems to have flipped – there are now too few investment opportunities to satisfy the amount of capital that has been earmarked for these sorts of investments.

One important solution to this problem is for foundations to shift from an “RFP” mindset to a more proactive, collaborative, and supportive strategy. By helping to prepare investees for PRI investment, not only are the businesses or non-profits more likely to get funded, but they will also be better equipped for success. Needless to say, this means both the venture and the foundation can achieve their goals.

There are dozens of ways to do this, and each foundation will approach it differently based on their unique situation and their community’s needs. Here is what we have done at the Tony R. Wells Foundation.

Step 1: Be approachable, collaborative, creative partners.

For years, the Wells Foundation operated from Tony and Dana’s home. They even listed their home phone number on business cards, representative of their commitment to being available whenever a community need arose. As the foundation added additional staff, a culture developed around responsiveness and approachability, further strengthening the foundation’s reputation in the community.

As a foundation with half a dozen staff, to say we have twenty or more meetings each week with people in the community may seem excessive, but it’s truly how we operate. We meet with nonprofit leaders, board members, social entrepreneurs, and other foundations. We also meet with college students looking to making a living and make an impact with their career, with successful business people who are looking to give back but aren’t sure where to start, and corporations trying to build a culture of giving back through a new CSR program.

We believe these meetings are an integral part of our mission. It is this direct interaction with people that allows us to take a pulse of the community. This is also how we connect with people who have great ideas that need support in order to grow them to the next level. We approach each interaction with an open mind, a positive attitude, and knowledge of the tools in our toolbox.

For example, we once received a request for a loan with an accompanying three page business plan to support the request. It was far from complete. Most foundations would automatically send an email response saying “After careful consideration unfortunately…” and move on to the next applicant, completely missing the opportunity to provide constructive feedback, guidance, and support.

Instead, we invited the individual to our office to learn about her vision and excitement. We then asked her questions about her idea that helped her realize not only what information she was missing, but why it was important. We recommended she seek professional support to build out the rest of the business plan, suggested a couple of good consultants, and invited her to send over another draft for review and feedback when she was ready.

This process repeated itself several times over the course of a year until her business plan was twenty eight pages in length and much more thorough. We still haven’t invested, and we may never invest. It was never about that for us. Teaching someone how to develop a business plan and building their ‘capacity’ – is far more valuable in the long term than a particular idea.

The other role we play is the collaborative, creative problem solver. We encourage nonprofits to be opportunistic, which in turn means that we need to be responsive and opportunistic too.

For example, when a nonprofit executive who had been operating out of donated warehouse space found out he would need to relocate within two months, he identified a 60,000 sq. ft. building a couple of blocks away that would work perfectly and gave us a call. This was his proposal:

“I would like you to buy the $2.3 million building and lease it to us for 3 years. We will commit to a guaranteed buyout at the end of year 3, giving us time to organize a capital campaign. To de-risk the deal, we will put $500,000 down on the property.”

We cleared our schedule and met him the next day, touring the building and talking through options. We were ready to move forward with a two week close and had begun our due diligence when we found out another nonprofit had bought the space right out from under us! There will be more opportunities to help that particular nonprofit, but the point is to be responsive, creative problem-solvers, enabling nonprofits to be opportunistic.

Step 2: Educate Grantees

We often find ourselves explaining that we offer a full suite of support to our constituents as a private family foundation. Many people enter conversations with us thinking ‘grants’, but we also can make impact investments, share knowledge, direct them to resources and help make connections. If someone is only seeking grants, they’re missing much of the opportunity for us to help them.

In 2012 the Wells Foundation made the decision to commit 100% of our assets to our mission. We liquidated our investments and made those assets available to the community as impact investments. However, for years nonprofit leaders did not think to approach the foundation for investments, only grants. As a result, much of the funds were unable to be deployed.

In the summer of 2013 the foundation hired a small team of people to conduct research to pinpoint the reason why, and to develop a solution to the problem. The team found that less than 20% of Ohio nonprofits had ever thought of a foundation as more than a grantmaker. Furthermore, few knew what a program related investment was. Only a fraction had ever taken an investment from a foundation.

The team of researchers then determined what knowledge was necessary for a nonprofit leader to be able to consider whether social impact investments could help their organization further its strategic goals. The team searched university programs, centers, etc., across the country but could not find a single program on the topic of social impact investing that it could leverage to educate local nonprofits. So, we decided to build the first one. After compiling information from dozens of articles, white papers, research reports, and books, and under the guidance of university partners and expert educators, the team created a 3-day executive education program on the topic of social impact investing.

Since September of 2013, the Wells Foundation has run the program continuously every other month and has graduated nearly 250 nonprofit leaders, social entrepreneurs, foundation leaders, and other individuals. The program is fast paced, filled with far more content than could possibly be covered in 3-days. The goal, however, is to provide a rich understanding of the industry trends, the technical knowledge needed to navigate legal, tax, and financial aspects of impact investing, and to provide the case studies, tools, and resources that will guide participants after the program’s completion.

Another unique element of the program is that it comes with 5 hours of free consulting time. This is not a marketing ploy to build a consulting practice within the foundation; rather, it is our way of supporting program graduates to apply the knowledge gained in the class so they can overcome whatever barrier prevents them from moving forward with impact investing or a new social enterprise.

Graduates have used the time in various ways. We have presented to their boards, and fielded the tough questions that the executive director felt uncomfortable or unprepared to answer. We have participated in strategic planning retreats, helped build financial projections, and provided feedback on business plans and ideas.

The number one request we received from past participants was to find a way for board members to gain exposure to the program, but in a condensed format. As a result, we built a half day seminar that covers some of the main topics of the course in a summary fashion.

We began by asking corporate foundations in our community to host half day seminars on site (free of charge), since many of them had over 100 employees serving on nonprofit boards. With a captive audience, we saw this as an opportunity to quickly and efficiently educate a large number of board members. However, we didn’t want to limit ourselves to the employees of just a few large corporations in our community. For that reason, we now also offer the seminar publicly to any nonprofit board member who wants to attend, regardless of employer.

In addition to these regular educational offerings, we participate in various webinars, speaking engagements, and other events. Over time, this participation has built us a reputation of being an expert on impact investing in the Central Ohio region. As a result, we no longer need to search for opportunities to share what we’ve learned. We receive requests throughout the year to speak about our experiences and help nonprofit leaders think differently by sharing examples of innovative work that their peers have successfully conducted.

Step 3: Collaborate with Partners

Cincinnati is a great example of a funder community that has come together to offer a coordinated ecosystem around social impact investing. The foundations in that community jointly funded an organization called Flywheel to provide education and social enterprise development support. Flywheel helps build capacity in the grantees of those foundations, and is building an investment pipeline for The Greater Cincinnati Foundation and others that offer social impact investments.

Flywheel is one example of a collaborative group of foundations looking for ways to help their investees build capacity and prepare for PRI investment. Another way to expand their foundation tool chest is through co-investing. By sharing investment opportunities with other foundations, investees receive additional benefits that a single investor could not provide. With multiple PRI funders, investees gain resources and experience of multiple foundations, spreading their support more widely. Co-investing is also a way for investors to learn from each other and share best practices.

When we reach out to the larger community to educate and disseminate opportunities for investment, like we did with the Toledo Community Foundation recently, we are preparing both sides of the funding equation for increased and more efficient mission investing. At the Toledo Community Foundation’s request, we presented this information to two separate audiences, donors and grantees, with the goal of developing an impact investing ecosystem in Toledo in the future.


With proactive and visionary leadership, foundations across the country of any size or program area can leverage their resources and expertise to help better prepare more mission-driven organizations to receive and make use of PRIs more efficiently. This will undoubtedly enable and encourage more deals to be identified and made to meet the growing demand among foundations looking to leverage more of their dollars.

For more detailed information about what we’ve learned so far, please contact Patrick Westerlund with comments or inquiries at

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