A data story about higher education philanthropy, hidden complexity, and institutional follow-through

The Money That Doesn't Move

Universities raise billions every year.

Some of the money already available for spending never reaches its intended purpose.

The promise

Most people imagine philanthropy as a straight line.

A donor gives money. A university receives it. A student, researcher, faculty member, or program benefits.

Donor
→
University
→
Impact

The surprise

The problem is not always finding more money.

Sometimes, the harder challenge is moving the money that has already been released for use.

Act I · The scale nobody sees

Start with the number everyone reports.

The 2025 NACUBO-Commonfund Study included 657 colleges, universities, and affiliated foundations with a combined $944.3 billion in endowment assets.

But invested assets are not the same thing as spendable money.

In FY25, institutions withdrew $33.4 billion from endowments. That is the annual pool already released to support institutional purposes.

Public scale figures come from the FY25 NACUBO-Commonfund Study of Endowments, which reported data from 657 U.S. colleges, universities, and affiliated foundations.

Endowment assets $944.3B

Invested for long-term support.

Annual endowment withdrawals $33.4B

The yearly spendable pool released from endowments in FY25.

Operating support 15.2%

Average share of institutional operating budgets funded by endowments.

Where the withdrawals are intended to go

Nearly half of endowment spending supports students.

The $33.4 billion annual withdrawal pool does not point to one destination. It moves through many mission categories. The largest is student financial aid.

Student financial aid
47.4%
Academic programs & research
17.7%
Faculty positions
10.8%
Facilities
7.6%
Other purposes
16.6%
Scholarships become the lens.

The same mechanics can apply to fellowships, research, faculty support, buildings, symposiums, departments, programs, awards, and other restricted purposes.

The blind spot

Then comes the question the sector does not report publicly.

Known $944.3B

Endowment assets

Known $33.4B

Annual endowment withdrawals

Unknown $--.-B

How much distributed philanthropic money was actually spent from available fund balances?

We know how much money enters the system. We know how much leaves the endowment. We do not have a standard public metric for how efficiently that money reaches its intended purpose.

The real pathway

The straight line becomes a sequence of decisions.

This is not true of every fund at every institution. But the path is often far more complex than the public story of philanthropy suggests.

What people imagine

Donor gives
→
University receives
→
Student benefits

What often has to happen

Gift agreement
Fund created
Distribution released
Purpose interpreted
Owner identified
Eligible use confirmed
Approval pathway found
Spending plan created
Impact reported
Friction points 4

Interpretation, ownership, eligibility, and approval can each stop the path.

Every step can be reasonable. Together, they create friction.

Act II · The freeze

The villain is not a person. It is complexity.

When visibility is low, rules are unclear, and ownership is fragmented, impact can stall even when the money is already available.

One fund

A simple scholarship fund stops looking simple.

Start with an endowment. The invested principal remains invested. The annual distribution is the money available to spend.

Then the real questions begin. A phrase that looks simple on the fund card — “undergraduate scholarship support” — only becomes usable after someone reads the underlying gift agreement and determines what the donor, institution, policy, and process actually allow.

Example fund

Scholarship Support Endowment

Invested corpus $250,000 Not the spendable amount.
Annual distribution ~$12,250 Illustrative 4.9% endowment spending policy example.
Purpose Undergraduate scholarship support Sounds straightforward. The agreement will complicate it.
Restriction Academic promise + financial need + institutional policy Each phrase can become a decision point.
Possible owner Department Financial Aid? Foundation? Budget Officer? Advancement? Committee?
Spend question Who can approve this? The balance is visible. The pathway may not be.
Now imagine this for: scholarships fellowships research awards buildings departments symposiums

The interpretation problem

Would you know how to spend this?

Every donor-based scholarship fund has an agreement behind it. The fund card may say “undergraduate scholarship support,” but the agreement explains what that actually means, who may qualify, who may decide, and what rules must be followed before money moves.

The Fund shall support undergraduate scholarships.

Preference shall be given to students enrolled full-time at the University who demonstrate academic promise. How do we qualify academic promise?

Preference shall also be given to students with demonstrated financial need, as determined by applicable institutional methodology. What is our institutional methodology?

Such preference shall not be interpreted to exclude students otherwise eligible under University policy. What does this even mean?

Awards may support students pursuing programs aligned with the donor’s stated interest in expanding educational opportunity, civic leadership, scientific inquiry, and community benefit. How do we determine who meets this criteria?

Expenditures shall remain consistent with the Fund’s purpose, University policy, applicable foundation procedures, and any relevant stewardship or reporting obligations. What procedures? What other obligations?

Pause

Give up yet?

People with roughly your level of training in donor-intent interpretation are often expected to decide whether money can be spent from language like this. Unless you happen to be one of the world’s few experts in this domain, in which case, congratulations, this section is about your coworkers.

If, in the judgment of the University, the original purpose becomes impracticable, impossible to administer, or inconsistent with applicable law or institutional policy, the University may apply the Fund to a purpose that most nearly approximates the donor’s original charitable intent. Who makes this decision? How do we know if this is unawardable?

The University shall retain reasonable discretion to determine award timing, recipient selection procedures, coordination with other aid, and carryforward of unused distributable balance, provided administration remains consistent with the Fund’s stated purpose. Again, who makes this decision?

The question nobody owns

“Can I spend this?” should be a simple question.

But without a clear facilitator, the search for an answer can become the process itself.

Start Department asks: Can I spend this?
Budget Officer “Maybe Financial Aid knows.”
Financial Aid “We can award it, but only if the criteria and process are clear.”
Back to Budget Officer “Then check with the Foundation.”
Foundation AP “The fund exists. The use needs purpose review.”
Foundation “This may be allowable, but we need donor-intent context.”
Advancement “We know the donor story, but not the awarding process.”
Back to Financial Aid “Still need an owner and selection process.”
Back to Foundation “The restriction still needs interpretation.”
Back to Department “So... can we spend it?”
Policy “Depends on purpose, process, documentation, and authority.”
Partial Answer Everyone helped. Nobody owns the outcome.
Without a facilitator

The path moves sideways, backward, and around the institution.

The problem is not that people refuse to spend. It is that the answer is distributed across too many places.

With a facilitator

The same complexity does not disappear. It becomes navigable.

A facilitator does not make donor intent, policy, financial aid, or foundation procedures simple. The facilitator owns the question long enough to turn ambiguity into a decision.

Without ownership Weeks, months, or unresolved

Question bounces across offices.

With ownership Days to weeks

Question becomes a pathway to impact.

Question
Purpose
Barrier
Owner
Plan
Student Awarded
Facilitator Owns the question
Question
Review Purpose
Name Barrier
Align Owner
Build Plan
Student Awarded

The industry problem

The problem is common. The measurement is not.

95%+

In a FundMiner-hosted conference poll with nearly 1,000 participants and 400+ institutions represented, more than 95% of respondents indicated they had not solved the underspent-funds issue.

This is not a national benchmark. It is a field signal: institutions recognize the problem, but the sector lacks a standard public metric for whether available philanthropic funds reach their intended purpose.

Act III · What the data can reveal

Inactive funds rarely announce that they are stuck.

They are usually found by looking backward: activity history, distribution patterns, fund purpose, balances, spend behavior, and whether anyone appears to own the next step.

Pattern 1

Used, then abandoned

A fund supported activity years ago, then quietly stopped moving.

Pattern 2

Recurring underspend

Distributions arrive, but spending does not keep pace.

Pattern 3

Never activated

The fund exists, but no durable process was ever created.

Risk signals

No recent expense activity
Recurring carryforward
Unclear restriction language
No obvious fund owner
Staff turnover
Manual approval path
Scholarship criteria not mapped
No spending plan

The point is not just to find inactive funds after years have passed. The point is to predict which funds are at risk before impact stalls.

The diagnostic

Underspending is a pattern across time.

A single year can be noisy. A fund may pause, recover, or wait for the right purpose.

But three years with no expense activity is no longer noise. It is an operational signal.

Three years of spending less than half the available balance says the fund is moving too slowly.

Three years of spending less than half the annual distribution says new money is arriving faster than impact.

The result is not a moral judgment. It is a work queue: investigate purpose, ownership, process, and plan.

Anonymized fund diagnostic 5-year activity window
Expense activity Three-year activity signal
Spend vs. available balance Threshold: 50%
Spend vs. annual distribution Threshold: 50%
Classification Watchlist

One weak year is a prompt to watch, not enough to classify the fund.

No spend
<50% of balance
<50% of distribution
Review queue

The consequence

The cost is not only financial.

A student qualifies for aid. A scholarship fund exists. The annual distribution is available.

But the ownership is unclear, the criteria are not mapped, and nobody is sure who is supposed to move it.

The student never sees the money.

Act IV · The intervention

The fix was not another policy. It was ownership of the question.

The breakthrough came from asking a simple operational question: what is actually stopping this fund from being used?

The method

Turn ambiguity into a next step.

Once a fund was identified as inactive or underspent, the work shifted from reviewing balances to diagnosing barriers.

Was the issue visibility? Interpretation? Ownership? Awarding process? Department confidence? Once the barrier was named, the solution became much easier to build.

Find the fund
Review purpose
Name the barrier
Identify owner
Build plan
Follow through

A real-world consequence

A scholarship fund existed for decades.

Students qualified every year. The criteria were broad enough for the fund to support many of them. But responsibility for awarding was unclear, and no consistent process existed to move the money from available balance to student aid.

Once stakeholders aligned and ownership was clarified, students received support without needing to do anything differently.

Scholarship fund exists
Students qualify
Ownership unclear
No consistent awarding process
Facilitator aligns stakeholders
Students receive aid

Act V · Impact

Money that had been stuck in ambiguity became money with a path.

The institutional case-study figures below are anonymized. They are not national estimates. They show what can happen when available philanthropic funds are managed as an active portfolio.

First, the diagnostic turned scattered fund records into a defined review portfolio.

Then academic units and central offices converted ambiguity into spending plans.

After intervention, the year-over-year spend rate on identified underspent funds increased eightfold.

In scholarships, shared ownership changed the awarding outcome: money moved when the process had a home.

Identified $13M+ Underspent or spendable funds surfaced for review.
Committed $10M+ Moved into unit-level spending plans.
Activated 8× Year-over-year spend-rate increase after intervention.
Indexed spend rate
Before
After
8×
Scholarship awarding model
Department-only 13%
Co-managed with financial aid 87%

That is not idle accounting. It is scholarship support, research activity, faculty support, programs, and mission work that already had money waiting.

One fix

Scholarships moved when ownership was shared.

The financial-aid comparison is not just a success metric. It is an example of the facilitator model: connect the people who understand the money with the people who can move it to students.

The difference was not funding availability. It was structure, expertise, and follow-through.

Shared ownership changed the pathway.

Department identifies purpose
Financial aid maps criteria
Owner confirms process
Student awarded

What comes next

The future is not just finding forgotten money faster.

The future is building institutions where philanthropic money is actively managed from donor intent to impact.

Past Raise money

Measure gifts, pledges, endowment growth, and investment performance.

Present Find stalled funds

Use historical data to detect underspending after it has already happened.

Future Manage impact portfolios

Track purpose, ownership, spending plans, utilization, and time-to-impact.

The reframe

What good is a billion-dollar endowment if we do not know whether the returns reached their purpose?

Endowments are built for permanence. Distributions are built for impact. Between those two ideas is an operational system that must be measured, managed, and owned.

The future is not finding forgotten money faster. The future is building institutions where money is never forgotten in the first place.

How to read the evidence

National scale and institutional case work answer different questions.

Public scale data

FY25 NACUBO/Commonfund reporting describes endowment assets, withdrawals, spending commitments by purpose, and the average share of operating expenses funded by endowments.

Anonymized institutional analysis

Case-study figures describe one institution's underspent-fund review, planning work with academic units, and year-over-year activation after intervention.

Illustrative examples

Fund cards, agreements, pathways, and operational scenes are simplified composites designed to explain patterns without disclosing institution-specific fund records.