A Reflection on ImpactPHL’s Total Impact Summit ’26
By Fernanda Sesto, Values-Led Business Project Lead
On May 13-14, over 500 investors, foundation leaders, community practitioners, and policy thinkers gathered at the Convene City View in Philadelphia for the annual Total Impact Summit, hosted by ImpactPHL. The theme this year was “Capital Orchestration for the Future of Place,” a frame that pushed beyond the familiar language of “impact investing” to ask a harder question: What does it actually look like to coordinate diverse forms of capital around the lived experience of a specific community?
This was my first Total Impact Summit. I came as someone relatively new to the impact investing world, but deeply engaged in the broader questions of how finance can enable social change. I left with new relationships, sharpened frameworks, and a few uncomfortable truths I’m still sitting with. What follows is less a comprehensive recap and more a set of reflections on what I heard, what moved me, and where I believe the field still has hard work to do.
The Case for Capital Orchestration
This year’s programming made the case that in a moment of federal retrenchment, with billions in infrastructure and social spending frozen or clawed back, scarcity itself raises the stakes on coordination. When there is less funding to work with, deploying it strategically and in concert with fellow agents of change in the ecosystem becomes the difference between marginal and significant impact. Rather than treating grants, investments, municipal bonds, and community finance as separate instruments, the Summit asked attendees to see them as interconnected levers within a system capable of reinforcing one another. The concept of “capital orchestration,” drawn from the TransCap Initiative, provided the intellectual backbone of the convening, and place is what made it more tangible. This theme was a compelling reminder of the connection between both place and capital orchestration, and the sessions brought that to life through concrete examples.
Transforming Capital to Transform Communities
My favorite panel of the event was “Transforming Capital to Transform Communities”, featuring Deborah Frieze of Unlock Ownership, Amber Quiñones of Stray Works, Norbert Cichon of Spring Point Partners, and moderated by Roodgally Senatus of ImpactAlpha.
What I appreciated most was the creative solutions the panel highlighted. The willingness to sit with a deal and a lawyer and ask, “how do we make this structure serve the community we’re investing in, rather than the other way around?” That’s a radically different starting point from how most institutional capital gets deployed and it inspired me to think how the broader field could adopt and scale this model. The panelists weren’t just arguing that capital needs to be transformed, they were presenting examples of innovative and structural work that makes deals fit communities instead of making communities fit deals. The inspiration from these examples surfaced the central tension I kept returning to throughout the conference: if we know how to do this, what is actually stopping the rest of the field?
The Contradiction at the Center of Philanthropy
As someone coming to impact work from a background in venture capital and tech, what struck me the most was the disconnect between philanthropy’s stated social mission and how cautious and conservative the institutions are in practice. Throughout the Summit, conversations and panels circled around the ideas of risk and concessionary returns. As I kept trying to wrap my head around these new ideas, I asked myself “why isn’t it all grants in the first place?”
If the purpose of a foundation is to address social problems, why not just give the money away? The answer is that most private foundations are built around a perpetuity model. The idea is that by investing the endowment and only spending a portion each year, the foundation can exist forever and fund work indefinitely. That logic has initial appeal. However, this also means that these institutions become and operate, above all, like asset managers. The primary institutional goal becomes preserving and growing the endowment and the mission work gets funded from what’s left over.
Foundations have no shareholders, no quarterly earnings calls, and no LPs to answer to. They have the most patient, most flexible capital in the ecosystem. Yet, their endowments are managed to grow capital in perpetuity and investment committees are dominated by conventional finance thinking with minimal appetite for risk. The actors best positioned to take risk are the ones least willing to take it.
Foundations are ultimately the most risk-averse actors in a field that should reward risk. Thinkers like Vu Le (Nonprofit AF) have been critical about this as well. He identifies risk aversion and what he calls “suppressed imagination” as a core dysfunction of the philanthropic sector, arguing that funders have become more accountable to avoiding risk than to ushering in actual change. In fact, nearly 70% of nonprofits report that funders avoid bold or flexible investment, and that tracks with what I heard in conversations and at panels during the Summit where risk dominated the discourse.
The 5% payout / 95% invested model is shocking. Not only are foundations not giving all their money away, they are not even required to give most of it. Private foundations in the United States are only required to disburse 5% of their assets annually for charitable purposes. The other 95% is typically invested in traditional markets, often with no mission alignment at all. When I learned about this, I was perplexed. An institution whose entire reason for existing is social benefit has 95% of its capital working in the same markets as everyone else, optimizing for returns, not impact.
It is worth mentioning that a handful of foundations are experimenting with different models and have committed to aligning 100% of their endowments with their stated missions. For instance, the F.B Heron Foundation committed 100% of their portfolio to its anti-poverty mission and achieved that goal in 2016. The Nathan Cummings Foundation followed in 2018, voting to align its nearly $500M endowment with its racial justice and climate mission. Finally, in 2023, The California Endowment announced it would transition its entire $4B in assets toward mission alignment, becoming the largest foundation to do so.
Beyond mission-aligned endowments, there is a growing movement around what philanthropic capital could look like if it moved in more creative and risk-tolerant ways. Catalytic capital, which includes debt, equity, guarantees and other instruments that accept disproportionate risk in order to generate impact, is gaining momentum. For instance, The MacArthur Foundation’s Catalytic Capital Consortium, launched in 2019 with The Rockefeller Foundation and Omidyar Network, has deployed over $128M in investments designed to take on early risk, build track records for emerging fund managers, and bring in conventional investors once a model is proven.
Additionally, recoverable grants offer another tool where the capital can be returned if impact goals are met. This creates a virtuous cycle that multiplies the cumulative impact of each dollar. These instruments exist, work, and point to a different way of operating with foundation capital, not just through the 5% that is allocated as grants but through the full balance sheet. Yet foundations experimenting with these models remain exceptions, not the norm.
Whether it's 5% or 100% of the endowment going toward social mission, another question I keep asking is where's the social upside?
Venture capital is far from a stellar model, but we could still learn from its risk appetite, its comfort with uncertainty, and its willingness to accept failure. Venture investors follow conviction without fixating on how the future might go wrong, staying curious instead about what it could become. That mindset is worth borrowing. The logic is iterative rather than predictive. VC doesn't plan the winner upfront. It places a wide range of bets, doubles down on the ones showing promise, doubles down again, and treats the failures as the cost of finding the outliers, because those outliers can be transformational. Why can't philanthropy apply the same logic to social outcomes? An allocation strategy that is a spread of modest bets on community experiments, with real follow-on funding for the ones that start to work. Some will fail. The ones that don't could reshape how we live.
The panels at the Summit showed that the people doing this work already know how, and that the infrastructure is being built. Will the institutions holding the largest pools of capital meet the moment with the same urgency and courage these communities are already showing?
Looking Forward
I left the Summit with more questions than answers, which for a newcomer feels exactly right. The field is catching up to what communities have long known: that capital, when rooted in place and accountable to people, can be a tool for liberation rather than extraction.
