1980s: Mind the Gap

Several years ago, Laurie Michaels was at an arts event with friends in business and philanthropy. They started talking about the mind-boggling obstacles that emerge unexpectedly during the course of charitable projects, often derailing years of planning and millions in funding, while leaving urgent human problems unsolved.

Like the time a U.S. medical nonprofit was set to roll out a childhood vaccine program in Africa, only to encounter a compliance snare that added $40,000 in unfunded costs to the project, bringing it to a halt.

Then there was the costly glitch that prevented expensive medical equipment from being delivered to a hospital in Kenya. The severe flooding that damaged road-building machinery and derailed an ambitious infrastructure project in Bolivia. And the women’s education program that needed a new home base after an onslaught of political violence in Burundi.

Michaels, a clinical psychologist in Aspen, Colorado, was dumbfounded. “Why doesn’t someone solve this?” she wanted to know. One of her friends, co-chair of an international foundation, had an answer: Why not you?

Seizing the challenge, Michaels established Open Road Alliance in 2012. The philanthropic initiative provides quick-response contingency funding for global humanitarian projects thwarted by unforeseen roadblocks. Open Road Alliance fills financial gaps often just a fraction of a project’s overall budget that were not anticipated in initial planning and funding processes. In this way, the initiative keeps projects and their impact on track.

“It never occurred to me there weren’t other people out there doing contingency funding,” Michaels recalled.

Her realization came at an opportune moment: Michaels was transitioning from years of private practice in counseling psychology and sought new opportunities in philanthropy. She had served on the board of directors of the Aspen Community Foundation for more than a decade, including a term as board chair.

Laurie Michaels
Laurie Michaels, at her home in Aspen, Colorado, is a philanthropist who focuses on risk management. She has established two scholarships at CSU, the Dr. Laurie F. Michaels Scholarship in Education and the Dr. Laurie F. Michaels Scholarship in Psychology, and has provided funding to launch an academic concentration in certified addictions counseling. Photograph by Michele Cardamone

Since Open Road Alliance began, it has dispersed more than 150 emergency grants and about 50 bridge loans totaling more than $28 million. The organization’s contingency funding, with grants averaging $75,000 per project, has enabled international projects totaling more than $300 million to move to completion.

As Caroline Bressan, the initiative’s director of social investments, explained in an interview with Bloomberg, Open Road Alliance focuses on unexpected obstacles, not mistakes. “We like to say it’s an ‘Oh, my God,’ not an ‘Oops,’ and we can help solve their problem,” Bressan said.

In the course of this work, Michaels and Open Road Alliance have become leading advocates for improved risk management in philanthropy urging grantees and funders to effectively define, discuss, assess, and address risks during project funding and implementation, much as the private sector routinely confronts risk.

The need is clear: One in five projects, or about 20 percent, encounters unforeseen external challenges that require additional funding for completion, according to research conducted by Open Road Alliance and published in The Foundation Review.

“It’s not a sector that’s built to accommodate risk. It doesn’t think about it very well, and it doesn’t manage it very well,” Michaels said.

After growing up in Connecticut, Michaels earned a bachelor’s degree in English from Williams College. Her brother introduced Michaels to Colorado State University, and she moved to Fort Collins to earn a master’s degree in psychology in 1981 and a doctorate in counseling psychology in 1983. She returned to the East Coast to launch a career helping patients with behavioral and mental-health struggles, later returning to Colorado to settle with her family in Aspen.

It appeals to Michaels that her nonprofit functions as a fast-action committee, stepping in to aid humanitarian efforts that were earlier fully vetted by primary funders, typically government agencies, private foundations, and nongovernmental organizations. The approach means Open Road Alliance has a catalytic effect, leveraging primary funding for impact.

“It relates a little bit to how I am as a therapist. ‘Let’s be practical. Let’s fix this,’” she said. “Working with people in therapy, I always started with, ‘What’s the problem? What do you need, and how do we go about fixing it, and then move on?’”

Yet her passion for philanthropy arises from core concerns about human welfare.

Michaels pointed to a research project in Burundi designed to assess the effects of fortified rice on children suffering from inadequacies in essential dietary vitamins and minerals. Open Road Alliance provided $40,000 that enabled the project to overcome a bureaucratic hurdle in its proof-of-concept stage; thus, the study moved to a clinical trial, resulting in government approval and availability of the fortified rice for a chronically malnourished population.

“What’s of interest to me is helping other people,” Michaels said. “That’s what matters. That’s what is meaningful.”