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Thank you for reading this post, don't forget to subscribe!Yesterday, we talked about some big-name, deep-pocketed businessmen who were, at the very least, disappointed by the responses of their alma maters to anti-Semitic behavior at Harvard and UPenn.
Donor opposition has become a serious PR headache for schools. This is exactly the issue.
As my colleague Nathaniel Meyerson reports, donors understand as well as anyone that pulling their money won’t cause significant financial harm to Ivy League institutions that boast huge endowments. The purpose of donating – in addition to showing support for your school out of the goodness of your heart – is to exercise soft power within influential institutions that are shaping the minds of future generations. And of course, to get tax forgiveness.
According to Lee Gardner, a Chronicle of Higher Education writer who covers higher education finance, the impact of the withdrawal of angry donors is unlikely to be immediate. But, he said, it could take away some of the gifts or donations that would be forthcoming.
“Ivy League universities have the relative luxury of being extremely wealthy,” Gardner said. “They have a lot more financial protection from the impact of some donors being upset.”
Donor feedback reflects how colleges have to run themselves like a corporation.
Like any large business, a university is beholden to donors (who act like shareholders, using their money as a fiduciary) and students (their primary consumers, who may eventually become donors themselves). . All other stakeholders like professors, parents and staff are not mentioned.
Although losing one or two donors is not a fatal blow to elite colleges, they still need donors to help keep the lights on. Even well-funded schools like UPenn or Harvard would have a big hole to fill if all the donors suddenly cut ties.
“Philanthropic funding of American colleges and universities is at an all-time high,” researchers at Indiana University’s Lilly Family School of Philanthropy found in a 2020 study. “Public and private fundraising forces are mounting campaigns with billion-dollar goals at once impossible levels – and they are achieving their goals.”
Philanthropy is the largest contributor to Harvard’s revenue, accounting for 45% of the university’s $5.8 billion income last year.
In fact, according to the school, the revenue generated each year from Harvard’s education and research efforts “is not enough to fund operations”. It depends on philanthropy to fill the gap.
At UPenn, charitable gifts accounted for 1.5% of the university’s $14 billion in revenue last year. Most of UPenn’s income came from its hospital network.
Former Harvard president and US Treasury Secretary Lawrence Summers has criticized the “morally unconscionable” student statement about Israel that prompted the donor revolt.
But he said financial threats from donors are not the right solution to influence universities’ positions on these issues.
“I believe universities’ adjustments should come from their conscience and conversations within their communities, not in response to financial pressure,” Summers told CNN on Tuesday.
Number of days: $22.99
One day, I imagine telling my grandchildren stories about the old days on Earth, gathered in our space pod. How we used to pay for things was by writing numbers on small pieces of paper kept in a book. How we drove on the “roads” and yelled about “traffic”. And how Netflix only costs $8 a month.
That last one already seems like ancient history, TBH.
On Wednesday, Netflix announced another price increase for some subscribers, increasing the cost of its premium ad-free plan by $3 per month to $22.99 in the United States. (In the United States its basic plan will increase to $12. All other plans, including its ad-supported $7 tier, will remain the same.)
Oh snap
These days, all the attention goes to TikTok — the app that has gotten teenagers fixated on their phones so China can feed them communist propaganda, or whatever.
Snapchat, the most engaged app of 20-something teens, has been overshadowed by TikTok pearl-clutching, Twitter musk-ing and meta threading in recent years. But meanwhile, Snapchat has quietly become the world’s fastest-growing social platform, writes my colleague Claire Duffy.
See here: As of the end of June, Snapchat reported 397 million daily active users — more than X, the platform formerly known as Twitter.
Crucially, last month it reached 5 million paying subscribers for its Snapchat+ service, halfway to its goal of 10 million just a year after it launched.
At 5 million subscribers paying $3.99 per month, Snapchat+ is set to make about $239 million in annual revenue.
Still, revenue growth hasn’t kept pace with those user gains. In the first six months of this year, the app’s parent company Snap saw revenue decline by more than 5% from a year earlier and posted an operating loss of $769 million. The company’s shares are down more than 11% since the same time last year.
When Snap reports quarterly earnings next week, it is expected to post its third consecutive decline in revenue.
why it matters
Social media is kind of a mess right now, filled with misinformation and desperate to feed us content from people we’ve never heard of. For many people, Twitter has outlived its usefulness; The joy of Instagram is dulled by frequent ads that seem suspiciously relevant, as if your phone is listening to your real-life conversations; Facebook is… Honestly, I don’t know what Facebook is anymore.
Snapchat has gone a different route, focusing on connecting users with their real-life social circles, writes Claire.
Of course, it is not untouched by dirt.
Like other platforms, Snapchat is also trying to reshape its advertising business to deal with changes in Apple’s app tracking policies. And the company is investing money in artificial intelligence and augmented reality.
Still, analysts are keen on Snap’s user growth, especially for a company that has been around for more than a decade.
“In my view, there is significant value for a company that is growing its installed base at this level,” said Angelo Zino, senior equity analyst at CFRA Research. “At the end of the day, when you think about advertisers, they want to go where their eyeballs are.”
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