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Charitable Athletes With Poor Foundation Planning Can Equal Disaster

Sometimes the best of intentions, even for forward thinking athletes, can have disastrous effects in the business and the community. For every positive story, like the Packers’ Greg Jennings raising $200,000 for youth programs in his native Kalamazoo, Michigan or the Yankees Derek Jeter doing great work with his “Turn Two” Foundation, there are stories of gross mismanagement of charitable foundations by athletes who put their trust in people who may not be qualified to run the complexity of a charity. This past Sunday the New York Post ran an exclusive story that showed the losses incurred by foundations of the New York Yankees C.C. Sabathia and The Jets D’Brickishaw Ferguson, two athletes with the best of intentions but the worst of business planning. The damage to the community and to the athletes work, is very hard to make up once the problems arise.

So what to do. We asked an expert in the business of sports philanthropy, New York native Harrie Bakst. Bakst runs Carnegie Sports & Entertainment, an innovator in helping a variety of charitable organizations through cause marketing and corporate social responsibility.

A cancer survivor himself, Harrie has worked with clients such as Grassroot Soccer, The Omanhene Cocoa Bean Company, Switch2Health, The Ulman Cancer Fund For Young Adults, Teachers Without Borders, The UCAN Company, pairing them with athletes like  Cole Hamels, Curtis Granderson, Tiki Barber, Meb Keflezighi, Paul Pierce, and others. Brands like Foot Locker, Nike, Garmin, CBS, PUMA, Chipotle Mexican Grill, GM, New York Road Runners, Major League Soccer, Reebok, The James Beard Foundation, and Memorial Sloan Kettering-Cancer Center have all benefitted from his work as well, helping all navigate the sometimes difficult waters of sports philanthropy.

We asked Harrie about what athletes can do and what makes good business sense in the world of sports philanthropy:

A recent article in the NY Post outlined some high level athletes who have issues with their charitable foundations. How do athletes avoid such issues?

The main problem we see in athlete/celebrity foundations is that they create an onus of founding one on themselves, which is a big problem not only for the sustainability of the organization’s but also from a tax perspective. Athletes and celebrities need to diversify the revenue of their foundations, so that when their playing careers are over, or if they get released, etc. their goodwill doesn’t get affected. This is where brand partnerships can come in and be successful.

What athletes do a good job with philanthropy?

Steve Nash and his foundation do an amazing job, they just hosted their showdown event in  NYC last week. Also, we’ve worked with Paul Pierce who has an amazing foundation ( The Truth Fund) and does some great work to combat childhood obesity on a local as well as national perspective. Also, we can’t forget about Lance. Despite his on the bike controversy, no one can come close to his amazing charitable work with Livestrong.  These athletes are clear in their purpose, have programs or fund programs that support their mission, have healthy financials that aren’t dependent upon their on the count contracts to fund their charities. They have created sustainability.

What brands have done a good job mixing athlete branding and cause marketing well?

Mission Athletecare, Bank of America, and most recently Citi’s new USOC sponsorships, are all excellent examples of brands attaching themselves to athletes and causes.  The fit is there, the activation is really clean and supported by the brand, the athlete as well as the foundation. All parties are prompting the partnership and wanting it to succeed. They are incorporating the cause piece into the marketing mix which is what every brand should be doing as opposed to a brand taking some profit from the end of the year and just writing a check.

How can fans know if their dollars are going to the causes they think they are?

Look at what a nonprofit supports. Is it a programmatic nonprofit? The big factor you want to see is the percentage of money that is using to fund their programs vs administrative fees. This is the money that is used to support their respective mission. Ultimately, that’s what matters in the end.

What are some of the better events you have been involved with? 

Grassroot Soccer, Ethan Zohn’s charity and the amazing things they did around the 2010 World Cup in South Africa, The ING New York City Marathon charity program which raises on $30 million annually, NY FEST, which is a charitable soccer event that is part of TriBeCa film festival. We are also working on Adrian Peterson’s foundations events now which includes a partnership with the Twin Cities Marathon and an event with Neiman Marcus.

Are there large scale events…NBA All-Star, MLB All-Star, Olympics, World Cup…that do a better job with athlete cause marketing than others?

The NBA with NBA Cares, which is run by Todd Jacobson does a fantastic job. All these events touch upon cause marketing but I think Todd and his staff get it and have laid the foundation for a lot of these other events.

What type of causes do the best work with athletes and why?

I think there are a lot, to be honest. Most importantly, it’s about the fit and execution. You can’t have Phillip Morris sponsoring a cause related event at Memorial Sloan Kettering. It’s all about his it makes sense, how it adds value to the cause and to the brand, and how it is ultimately executed.

What is the best example of an athlete and a brand paired with a charity that surprised you?

One that recently surprised me with 50Cent and his new product Street King Energy Drink, which at first marketed itself as for every unit you bought, they would donate a meal to a child in need. It was a great effort to do some good, but just didn’t see the fit there between the celebrity, cause and brand. Last I looked at their packaging, that cause related messaging was no longer on there.

How has social media affected the athlete/charity relationship?

It’s been good and bad. The good side is that it has created an amazing new conversation with donors and new fundraising as well as revenue streams that can be monetized through an athlete’s social media. The bad part is that social media, with the wrong slip of the mouth or should I say, key board, can really bring down the public and corporate support of an athlete foundation or charity work. You have to be careful.

What athletes do you think can do the best job on a global basis to raise funds and awareness with a brand that people may not yet know about?

I know I may be biased here because they were one of our first clients, but Ethan Zohn’s work with Grassroot Soccer on a global level is just unreal. They have graduated hundreds of thousands of children from their soccer based HIV aids prevention educational program and just continue to grow and innovate while engaging top international brands like Nike, Exxon, MAC, and Product (RED). Additionally, I think the gold standard for cause marketing and athletes is LiveStrong. What they are doing is really impressive and their partnership with Nike over the years has taken the organization to a new level, and it’s a perfect fit too. It makes sense and it’s leveraged to perfection.  I think a lot of people in the industry look up to them. Doug Ulman and his staff run a great ship.  Lance’s celebrity plus Nike’s brand power have raised millions of dollars for the cancer world.

 

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