This year marks a huge milestone for the Edward Lowe Foundation. On Sept. 3, 2025, we will celebrate 40 years of “championing the entrepreneurial spirit.”
While developing the foundation, Mr. Lowe recorded more than 200 videos that outlined his intentions to future leaders. In one video he said, “Obviously I can’t live forever, but my name and the foundation that I create can.”
Forever is a tall order, and Mr. Lowe’s meaning of forever has been heavily debated within our organization. I take him at his word, that he literally wanted the foundation to go on for all time.
Mr. Lowe made his fortune from free enterprise. The market and his customers were his masters. Yet at the foundation, our world is more limited. As a 501(c)(3) operating foundation, we can’t charge market rates; we can only recover a percentage of our costs. Essentially, we lose money on every program we offer. For example, we typically charge $1,100 per person for a three-day retreat — but the actual costs run about $3,000 per person. Thus, the more we do, the more money we lose. To go on forever, we need to develop additional funding streams.
There are three ways we can overcome this challenge: careful management of our endowment, expense management and fundraising.
Because the foundation’s endowment is largely dependent on the stock market, our budget varies each year. Fortunately, our board members possess a great deal of financial savvy, and they have been instrumental in helping us navigate the ups and downs of the market. Admittedly, things got dicey in 2008 during the Great Recession when the foundation’s corpus dwindled to below $70 million. Yet due to skillful investment management, we were able to weather the storm. As a result of this downturn, our trustees capped our annual spending at 4.8% of our endowment value. I am proud to report that our team has been below this threshold for over a decade.
In 2022 we began a new initiative, Entrepreneur Emeritus (E2), for individuals who have climbed to the top of our “programming mountain” and want to give back to others who are newer to our community. These amazing champions are also helping us find ways to strengthen our endowment. Dave Galbenski started the ball rolling with an E2 fund for individuals who wished to contribute to the foundation’s endowment. Since then, many of our E2s have donated either a portion or all of what we pay them to the fund.
Last year I began working with Dave and Dan Ducoté (another member of our E2 squad), to explore the creation of a public benefit corporation (PBC). The idea was that this for-profit entity, Second Stage Leaders, will be able to:
- Charge market rates for its services (something prohibited by the foundation’s nonprofit status).
- Channel some of its profits to the Edward Lowe Foundation.
- Help entrepreneurs in ways that we can’t.
As a 501(c)(3) organization, the Edward Lowe Foundation can only provide education, information and research to our second-stage entrepreneurs. Yet as a PBC, Second Stage Leaders can go further and elevate our programs through coaching, consulting, operating systems and other services.
I’m delighted to announce that after a year of rigorous research, development and due diligence, Second Stage Leaders got a green light to proceed. During our December board meeting, Edward Lowe Foundation trustees signed an agreement with Dave and Dan, who are CEO and president of the new company.
Mr. Lowe believed that when entrepreneurs reach a certain point in their journey, they have an innate need to give back and make the journeys of other entrepreneurs less arduous. Dave and Dan are living examples of this, and I am thankful for their giving nature and willingness to take on this challenge.
Forty years ago, Mr. Lowe predicted that the entrepreneurs served by his foundation would take us into the next 40 years. As often, I realize what a visionary he was to foresee this moment. Thank you, Mr. Lowe, for dreaming this big dream! With the help of foundation staff and leaders, our partners and amazing entrepreneurs like Dave and Dan, we will find a way to go on forever! Stay tuned for more details…