goes in English translation. “When I came you extended your hand to me. You let me in your beautiful country. I will be useful to you, and I’ll shine Uncle Sam’s boots in America! Everyone has freedoms here without end!” Except perhaps for the part about shining boots, it was a sentiment Broad knows well.
Five-and-dime to Fortune 500 The only child of the owners of a five-and-dime store, Eli Broad went on to become a living embodiment of the American dream. In 1956, at age 23, he gave up a nascent career in accounting to co-found the homebuilding firm Kaufman and Broad, later KB Home. It became the first such company to be listed on the New York Stock Exchange. Later, Broad transformed a small insurance company into SunAmerica, a giant in retirement savings. Now 80, he is well into what he likes to call his “fourth career,” overseeing the distribution of the couple’s $6 billion fortune in an impressive array of philanthropic ventures. The Broads are signatories of the Giving Pledge, having Building houses, building a home promised to give 75 percent of their fortune to charitable Given his achievements in the corporate sphere and his 12
PHILANTHROPY
The Broad Foundations, Andy Warhol Self-Portrait, 1966 © The Andy Warhol Foundation for the Visual Arts, Inc.
Eli and Edythe Broad in front of one of their Andy Warhol pieces.
causes. But apart from the Hebrew Actors’ Union gift, they rarely base their donations on a passing fancy. They are pioneers of what is often called “venture philanthropy”—giving designed in a business-like way to create maximum impact. They have focused their donations in three areas: education reform, modern art, and genetic research. Though he hasn’t practiced accounting for more than half a century, Eli’s head for number-crunching and penchant for meticulous research has made the Broad Foundation an exemplar of the ways that philanthropic gifts, when strategically deployed, can change a culture. “I’m working harder now than when I ran a Fortune 500 company,” Broad tells me. “Others just write checks. We don’t do that. We want to make a difference. We see everything we do as an investment and we want a return, whether that’s in terms of scientific and medical findings, or bigger and broader audiences for art, or student achievement.” We’re sitting at a small conference table in Broad’s twelfth-floor office at his foundation’s Los Angeles headquarters in Westwood. It’s a tidy, sunlit room decorated with a number of museum-quality canvases, including a Jasper Johns “Flag” painting and several Cy Twomblys. Eli strides over to his desk and retrieves an inch-thick binder. “We have a separate unit that evaluates every grant we make,” he explains, flipping through the painstakingly compiled end-of-year grant report, which runs nearly 300 pages. He notes that the foundation’s three-member evaluation unit is kept separate from other areas of the organization, to maintain the independence and accuracy of its findings. “We’re very proud of that,” he says. “I can’t think of any other foundation that has this sort of discipline.” Another point of distinction: Unlike many foundations that have teams of grant officers who sift through applications as they arrive, Broad says, “We don’t wait for people to come to us. We go and seek out ideas. I’m an entrepreneur…. I look for opportunities.” It’s an approach that other philanthropically minded executives are eager to learn from. Not long ago, the couple received a visit from an ambitious tech entrepreneur—“a very bright and very sweet young man in tennis shoes,” as Edythe recalls—who was thinking about making a big education gift and wanted some advice. The introduction had come from Arne Duncan, the U.S. Secretary of Education and a longtime colleague in the school reform movement, and the Broads were happy to offer their expertise. Not long afterwards, the sneaker-clad entrepreneur, Facebook founder Mark Zuckerberg, pledged $100 million to improve Newark, New Jersey’s struggling school system. The Broad Foundation later donated an additional $500,000 to the effort.