What’s in Store for ABF’s Next 10 Years?

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Chris J. Matlon, ABF Board Chairman
Nancy L. Schiller, ABF President

Chris J. Matlon is a retired senior vice president of Chase Manhattan Bank in New York, which included international banking experience in the UK, Hong Kong, Iran, Lebanon, Australia, and New Zealand. He received his master’s degree in international management from Thunderbird School of Global Management in Arizona and his BA from the University of St. Thomas in Minnesota. In addition to being the chairman of the board of the America for Bulgaria Foundation, Mr. Matlon served as a director of the Bulgarian-American Enterprise Fund (BAEF) since 2002 until the Fund ceased operations.

Nancy L. Schiller is president and CEO of the America for Bulgaria Foundation since June 2016. Prior to that, after 21 years of service as managing director of the Bulgarian-American Enterprise Fund (1992–2012) and the America for Bulgaria Foundation (2008–2012), Ms. Schiller was elected member of the ABF board of directors in December 2012 and became its vice chairman in June 2015. Prior to Ms. Schiller’s involvement with BAEF and ABF, she worked in commercial real estate development in Chicago and for several nonprofit organizations in the areas of management, finance, and marketing. Ms. Schiller has an MBA from DePaul University and a BA from the University of Illinois, both in Chicago.

In 2019, the America for Bulgaria Foundation is celebrating ten years of work in Bulgaria. What is ABF’s role in the country, and how has that role evolved over the years?

N.L.S.: We are an independent, nonpartisan, and nonpolitical grant-making foundation, and we work in various fields to ensure Bulgaria offers good conditions for economic prosperity so that every citizen finds meaningful, dignified work and lives a happy, fulfilling life. While ABF has operated for ten years, our history goes back much further, to the beginning of the changes in 1989. We stand on the shoulders of our predecessor, the Bulgarian-American Enterprise Fund (BAEF).

The Fund was created in 1991 as part of the Support for Eastern European Democracy (SEED) Act passed in 1989 by the US Congress. Funded with US taxpayers’ money through the US Agency for International Development, BAEF’s management was entrusted to an independent, volunteer board. Its goal was to aid former communist countries’ transition to democracy and a free-market economy. The Fund provided loans and training to early entrepreneurs in Bulgaria, helping spur private initiative at a time when funding and entrepreneurship knowhow were in scarce supply. Over the nearly two decades of its existence, the Fund invested in more than 5,000 Bulgarian businesses, creating thousands of jobs for Bulgarians.

Of the ten similar funds authorized by the US Congress, BAEF was the most successful, generating an 800% return on investment. It is that return that came to form the ABF’s $400 million endowment. The Foundation also took on the task of continuing the good work begun by the Fund—which involves improving lives, communities, economies, and businesses.

How do you approach your work?

C.J.M.: We are constantly studying Bulgaria’s many indicators to determine how ABF can have the greatest impact. This means adjusting our areas of emphasis or streamlining our approach. After ten years, we’ve learned a great deal. We updated our strategy to reflect the country’s current challenges and Bulgaria’s competitive advantages. Our work is focused on four priority fields of work:

  • Business, Entrepreneurship, and Technology
  • Developing and Retaining Human Capital
  • Business Enabling Environment
  • Cultural Heritage and Nature Tourism

In Business, Entrepreneurship, and Technology, we look for projects that enhance the productivity of small and medium-sized businesses through innovation and technology. The Developing and Retaining Human Capital field seeks to improve training and education for Bulgaria’s labor force through a strong emphasis on STEEM (Sciences, Technology, Engineering, English, and Math) education. Independent media, rule of law, and transparent and accountable public institutions are essential contributors to the development of a vibrant private sector and the growth of foreign direct investment, so we will continue to support programs that ensure a Business Enabling Environment. Lastly, we hope to revitalize local communities by supporting projects focused on Bulgaria’s remarkable Cultural Heritage and Nature Tourism, which can become a magnet for tourists from Bulgaria and the world.

Our new strategy improves the way the whole organization works and encourages our staff to use their different expertise and experience in order to come up with common solutions to problems. Our goal is a more holistic approach to solving longstanding challenges in the country.

What have you learned after ten years of operations?

N.L.S.: That change takes time, but also great discipline and self-criticism.

We have learned that Bulgaria has a tremendous resource in its human capital. That Bulgarians love their country and want to make it a better place for all its citizens. We have met remarkable people often working in near anonymity to improve the quality of life in their village, town, city, and country. It is indeed a privilege to partner with such amazing people.

That said, it is essential that we are self-critical, which is why we monitor and evaluate the success of the programs we support. We also encourage our grantees to do the same. We undertook a thorough assessment of one of our flagship programs, the Schools of the Future program, to ensure the funds invested are put to the best possible use.

We also learned that we can’t do it on our own. This is why we develop partnerships with others. The Bishop’s Basilica is a good example of ABF working with regional and national government and businesses to help restore Bulgaria’s cultural heritage. The corporate community and many private donors backed the Little Heroes initiative as well, which transformed Pirogov’s children’s clinics into a welcoming environment for all. We also partner with public institutions on projects in education and other fields.

Our investments in Bulgaria in ten years are sizable—more than $200 million in nearly 900 projects in education, cultural heritage, civic engagement, and private sector development—but they wouldn’t have made the impact that they have without our partners and grantees’ active commitment and their pitching in to share program cost.

How does ABF make money?

C.J.M.: ABF is structured as a perpetual foundation. Our endowment is invested by ABF’s Investment Committee in various financial instruments. We fund grants and other operating expenses with the income from our investments, thus not spending down the endowment. We expect to be working in Bulgaria for a long time to come.

What will the Foundation’s priorities be going forward?

C.J.M.: Our mission continues to be helping to create an environment in which every Bulgarian citizen can find a meaningful occupation and live a fulfilling life in his or her own country. This can only happen if the country has a vibrant private sector and strong institutions. At its core, our mission hasn’t changed, but we approach it in a way that reflects the challenges Bulgaria faces today. Rather than targeting individual fields, we take an integrated approach. Our focus will move away from niche projects, and we will place a greater emphasis on common solutions to maximize impact. The renamed fields of work reflect our emphasis on comprehensive, integrated solutions.

How do you define private sector development? Are NGOs part of the private sector? 

N.L.S.: In our definition, the private sector includes both for-profit private entities (businesses) and nonprofit private entities such as NGOs, trade associations, foundations, and others, the latter serving the critical role of connecting business with the public sector (government and other public institutions) and citizens. NGOs are how businesses and citizens self-organize to ensure their concerns are heard and enter the public dialogue.

NGOs do vital work that underpins the work of the business community. At the level of associations, they represent business interests in front of public institutions in a way that individual businesses cannot do for themselves. NGOs are experts in their fields and generally act more quickly than government bureaucracies do, which makes them ideal testing grounds for innovative ideas. Because of their strict specialization, NGOs are critical in advancing citizen interests as well.

In a healthy private sector, all constituent parts function properly and support each other’s work.

Will you stop funding projects in the arts?

N.L.S.: A number of our projects in arts and culture have achieved incredible success over the past ten years. Many of them such as Fortissimo and Easyart Children’s Fairs have become sustainable and moved on to independent existence. These accomplishments have encouraged us to aim higher—or rather, more broadly, by expanding our geographic focus. We will take the lessons we learned from these successful projects, most of which were in big cities, and apply them to more encompassing projects in smaller regions across Bulgaria.

Art and culture projects will form an integral part of our tourism- and community-building efforts in our HUB cities, Vratsa, Gabrovo, and Razgrad—three cities ABF has worked with for three years in our attempt to help regions with limited access to resources. In 2018, we donated nearly half a million Bulgarian levs toward local development initiatives in the three cities. Arts and culture projects form part of our strategy for the development of these regions, but not exclusively.

Is ABF support financial only?

C.J.M.: ABF is not a mere funding mechanism. We partner with the organizations from the project’s very outset. That said, we defer to our partners’ expertise in their fields. In addition to money, we offer support to improve their organizational capacity in the fields we are experts in: financial planning, monitoring & evaluation, communication.

We are invested in our grantees and partners’ success, so we will provide support and advice for the duration of our partnership. We are also committed to sharing our knowledge and building the capacity of our partners in government, business, and the NGO community. As a result, our grantees and partners benefit from a variety of training opportunities and resources.

For example, a recent gathering of ABF grantees featured useful workshops on communications and digital marketing, fundraising, EU funding, media, and CSR. Representatives from the digital fundraising platform GlobalGiving trained grantees on how to utilize digital tools for raising funds for their work.

Our research suggests that Bulgarians living abroad want to be more engaged with their birth country; they just don’t know how. So, together with BVCA – the Bulgarian Private Equity and Venture Capital Association, we conceived of the RE:TURN initiative, a large-scale attempt to encourage successful Bulgarian expats to invest in or otherwise support Bulgarian initiatives and businesses.

After interviewing more than 150 ABF grantees for a recent study, the Center for Effective Philanthropy, a consultancy advising foundations like ABF on how to give more effectively, found that what our grantees value particularly highly is our nonmonetary support.

How do you decide whom to support?

N.L.S.: Our process builds on the decision-making approach practiced by the Bulgarian-American Enterprise Fund, broadly termed character-based lending. That type of lending relied on staff members’ making judgments not only about the business’s viability but more importantly, about the potential and drive of the person/people running it. The Fund’s team got to know their clients really well.

Our approach is very similar. What we look for in a potential partner or grantee is initiative, expert knowledge, creativity, ethics, and, above all, the spark and drive to succeed. As our grantees will tell you, we also encourage close collaboration and provide support as necessary, outside our grant agreement.

Impact is important. We want to ensure that our money makes a difference. As a grantee, you need to know what you want to achieve and how to measure your success before the project begins.

Do you support businesses?

N.L.S.: Not individual businesses, but we have worked and will continue to partner with business associations to improve practices and competitiveness in sectors like agriculture and encourage entrepreneurship.

How do you make sure your work makes a difference?

C.J.M.: We are committed to bringing about sustainable change in our fields of work. We use monitoring and evaluation to ensure our programs and projects achieve what they set out to do. Broadly speaking, this means defining what we want to accomplish, tracking progress, and assessing project outcomes. M&E allows us to determine when a program is on track and when adjustments are necessary. Continual learning helps us stay flexible and respond to dynamic challenges.

Evaluation has taught us a great deal about our partners’ fields of work, and it has improved our own work significantly. We believe there is value in sharing this knowledge with our partners and grantees, which is why we develop and disseminate useful guides on a variety of subjects and organize training workshops with renowned experts in their fields. The Resources section on the ABF website is a good place to start if you need information about how to monitor and communicate the results of your work, get fundraising tips, and improve your CSR strategy.

How much control does ABF have over its grantees’ work?

C.J.M.: ABF grantees are partners, and while we require that the funding we provide is spent in the best and most transparent way possible, we respect our grantees’ expertise in their field of work and do not interfere with their decisions. That said, we communicate process-related or administrative concerns in a timely manner.

Regular, meaningful communication with our grantees is one of our top priorities. Our grantees and partners can get monthly updates from us by subscribing to our newsletter, or they can follow us on our social media channels. We value face-to-face contact too, so for the past three years, our community has gotten together once a year to exchange information, learn from each other, and celebrate our achievements. We also encourage sincere feedback and get it. We listen, too! After every ABF community event, we ask for feedback and have implemented many of our grantees’ recommendations. In fact, to allow for even greater transparency, our board of directors will attend the Grantee Forum in 2020, which will take place in April, at the time our board meets in Sofia, Bulgaria. Our partners and grantees will have a chance to talk to board members in person.

One of your goals is encouraging philanthropy in Bulgaria. How have you done so far? 

N.L.S.: This is our longest-term project in Bulgaria, requiring every Bulgarian citizen to realize that we are all responsible for making our societies better. This, unfortunately, cannot happen unless we are willing to pitch in, whether by giving money or time.

The perception among Bulgarians is that only large donations matter and giving a few levs will do nothing. This is not borne out by evidence. In fact, in the United States, individual donations add up to a lot more at the end of the day than corporate assistance.

One successful initiative started by ABF grantees is BulgariaGives, a platform that lists active campaigns and programs by reputable organizations around the country. BulgariaGives aims to facilitate charitable giving by matching potential donors to the right cause or organization. The platform’s one-week fundraising campaign in March raised 50,000 levs from 2,700 individual donors.

Another grantee, the Bulgarian Donors Forum, has been instrumental in helping Bulgarian businesses give more effectively and smartly and expand their CSR programs and in encouraging individuals to give.

We also work with civil society organizations to improve their fundraising savvy. Last year, ABF invited representatives of one of the largest crowdfunding platforms in the world, GlobalGiving, to give several workshops in Sofia. Our partners in the NGO sector learned how to present their work effectively, make donor pitches, maintain communication with donors, and report on results.

Your proudest achievement?

N.L.S.: There isn’t any one that stands out, in particular, although we take incredible pride in Muzeiko and the transformed children’s clinics at Pirogov Hospital. We celebrate every partner and grantee’s achievement. Our 2019 forum was devoted to celebrating our grantees’ successes, and our new website highlights these accomplishments as well.

What is the hardest part of your work?

N.L.S.: Having to say no to a really good project.

What are your future plans?

C.J.M.: Getting the Bishop’s Basilica of Philippopolis ready to open is a priority right now. We believe the early Christian basilica and its wonderful mosaics will be an incredible boon to the local economy and to Bulgaria’s tourism industry. The restored Bishop’s Basilica reveals stories from the past to inspire the generations of the future. It is a historic treasure that all Bulgarians can celebrate.

We are excited about several new partnerships and the expansion of youth programs such as Telerik Academy, with 90 new groups starting in 16 Bulgarian cities and giving hundreds of Bulgarian kids and adolescents the opportunity to learn useful IT skills. The largest one-on-one mentorship program for high school students, ABLE Mentor, will launch in 10 cities and for the first time offer online mentorship as well.

Through our partnership with ARC Academy, ABF will be providing scholarships to young Bulgarians interested in learning game and animated movie design. Young Bulgarians will also be able to learn entrepreneurship through 25+ Teenovator clubs in Sofia, Varna, and Vratsa.

Moreover, our free academy for starting entrepreneurs, BASE, will launch five new programs, two in Sofia and one each in Vratsa, Pleven, and the Srednogorie region.

So, there is a lot going on, and we encourage our readers to be on the lookout for new opportunities by subscribing for regular updates from us.