The Stiefel Family Foundation is a hybrid nonprofit which makes seed-stage investments in renewable energy startups and gives away the proceeds as grants to sustainability and job-creation programs in the US and Middle East.
The Stiefel Family Foundation (SFF) provides seed funding for clean-tech startups and grants for non-profits. Alignment Consulting’s initial objective was to help SFF determine what type of “value” they deliver to their investments. As this project progressed, the scope broadened from helping them determine the “value” they bring to evaluating the financial feasibility of their current business model. SFF is currently fully invested and thus unable to fund any new investments or give new grants. The foundation has 11 active investments with no firm exit strategies in place and will have completely spent down their endowment by 2014.
Personal interviews were conducted on most of their current portfolio to help determine where SFF excelled as a foundation. The Scenario Planning, the Business Model Canvas, and a Valuation analysis were also used to determine the current state of the company and to model the future recommendations.
Alignment Consulting recommends that the Stiefel Family Foundation separate its function as an investor from a coach/networker/grantmaker into two separate business models: a fund and an incubator. The fund will house all of the investing activity and will be able to make contributions to the incubator. The incubator, being separate from the fund, will be able to accept grants and donations and therefore have an outside revenue stream. We propose this separation take place in three phases. The fund and incubator model allows SFF to capitalize on what it does best, refine its value proposition, and secure a financially sustainable future.