Retired Maj. Gen. Bill Bowdon became head of the LSU Foundation in July 2004, after a 34-year career in the U.S. Marine Corps.
Bowdon, a 1970 graduate, came on board as the university was preparing its first broad, high-profile fund-raising campaign. A previous effort, begun in the late 1990s, harvested about $255 million in low-hanging fruit, but the campaign that would come to be known as Forever LSU was far more ambitious.
Former Chancellor Sean O’Keefe talked to leaders throughout the university and came up with a wish list totaling about $1.4 billion, Bowdon says, which wasn’t a realistic number. A consultant had suggested $450 million; Bowdon thought $500 million or even $650 million might be an impressive goal. O’Keefe decided $750 million was a reasonable target.
“He wanted to see us stretch,” Bowdon says.
Four hurricanes and one worst-in-a-generation recession later, LSU announced last fall that it had raised about $753 million in private donations. The current total, including the state’s match, Bowdon says, is nearly $800 million. He retires from the foundation June 30, leaving behind a stronger fund-raising apparatus with more big goals ahead.
No substitute for state aid
Private fund-raising always has been a way of life at private universities, though some public universities have been playing the game successfully for years.
“[The universities of] Florida, Georgia, Alabama, Texas—many of those schools had decades on us,” Bowdon says. “They have been doing that since the ’60s, so their endowments just show they started this before we did.”
Private fund-raising has been receiving more attention as states have struggled with tight budgets, says Rae Goldsmith, vice president with the Council for Advancement and Support of Education. But she stresses fund-raising is no substitute for state support. Cultivating a major donor can take years, and donations almost always are dedicated to specific purposes and can’t be directed into day-to-day operations. They can, however, be directed into the university endowment.
Fund-raising is becoming the dominant role for the modern university chancellor, and building the endowment is one of LSU Chancellor Mike Martin’s primary goals. The amount of endowed funds the foundation manages for the benefit of LSU, including the main campus, Paul M. Hebert Law Center, AgCenter, system office and Tiger Athletic Foundation, was $346.4 million as of March 31. The university manages an additional $18 million to $20 million itself.
Martin believes $1 billion is a good number to shoot for. If LSU had that much money tucked away, and assuming it received a 4.5% to 5% return over the past few years, it would have generated $45 million to $50 million.
“That is just about what the state cut us,” Martin says. “So if we would have had that billion, and we had that kind of revenue coming off of it, much of the impact we’ve been taking would be muted.”
Other universities, including Yale and New Mexico, have used their endowments to make real estate investments in the communities near their campuses. LSU, which historically hasn’t always been a friendly neighbor, now has a stated goal to reach beyond its boundaries and become more involved in Old South Baton Rouge while avoiding gentrification.
Martin says LSU might form a development corporation and work with private developers. The first step could be replacing the LSU-owned apartments on Nicholson Drive north of the former Alex Box Stadium site with projects that mesh with other developments planned for the area between the North Gates and downtown.
“I’ve said, only slightly jokingly, that I’m very much into developing Nicholson as a public-private partnership, provided we preserve our two anchor tenants: Fred’s and the Pastime,” Martin says.
LSU relies on the state for about half of its funding, while peer institutions tend to self-generate 70% or more of theirs, and Martin says LSU needs to move in that direction. A larger endowment could be part of that trend toward greater self-reliance, helping insulate the university from the whims of legislators and the ups and downs of the state’s fiscal picture.
The next campaign
Raising funds is part science, part art. In some cases, it might take 10 years of cultivating a relationship with a potential donor before he or she makes a contribution. Then there’s the non-LSU graduate from Oklahoma who, Bowdon says, willed several million dollars to the university, which was not expected.
Fundraisers assume 10% of donors will give 90% of the money. But every donation matters, and not just because of the money itself. A recent graduate who chips in $50 today forges a connection with his or her alma mater that might pay off down the road as his or her financial circumstances change. Most large donations come from people who’ve given smaller amounts in the past, Bowdon says.
Fund-raising goes on daily, with or without an official campaign. As for the next announced campaign, Bowdon says, the foundation is waiting to see how the state’s budget situation will affect the university. In the meantime, LSU’s donors probably could use a breather.
The next campaign might be short and limited, or long and wide-ranging; Bowdon says the chancellor will make that decision. If it’s the latter, a few years might pass until the official kickoff.
Officials say the structure built up over the past several years will remain intact. During Bowdon’s tenure, the foundation has gone from 35 paid fundraisers and support employees to about 90, combined 22 databases into one and established volunteer groups in cities throughout the country. Many of the names provided by those volunteers have not yet been contacted, so significant, untapped potential donors might still be out there.
Martin likes to point out that LSU still has plenty of facilities and infrastructure that could be named after people. He says he’s been meeting with every dean and every major unit that raises money, working out the next set of priorities for ongoing fund-raising. The sequel to Forever LSU could be a ways off, so there’s plenty of time to come up with a name. Martin claims the current Love Purple/Live Gold student recruitment campaign has inspired him.
“I’ve actually changed that,” he says, “to ‘Love Purple, Send Gold.’”
