from Zeek at Jewcy:

The Madoff scandal has exposed the bare underbelly of the Jewish non-profit world: most of its money comes from foundations or very significant private donors. It’s a top-down world that’s now going belly-up…

We are all grateful for foundations and major donors. Tzedakah is a mitzvah, and the Jewish community is remarkable for the generosity of its major donors. The donors are not the problem. The problem is that we Jewish non-profits rely on them too much. We underestimate the risks to our bottom line-and, more importantly, to our mission-that can come from relying solely on top-down foundation support…

There is an even larger issue here, however, than the current crisis caused by the Madoff blowout or the strategic question of how non-profits can survive and thrive. When a non-profit takes its money from foundations, and particularly when it relies upon one foundation, its mission can be compromised. The reason is that money from foundations and major donors is “top-down” money.

You can read more here from Madoff: Rethinking Jewish Fundraising by Jo Ellen Green Kaiser, Editor-in-chief of Zeek magazine.