"If you put fences around people, you get sheep. Give people the room they need."

— William L. McKnight, McKnight Foundation founder and former 3M CEO

wenty years ago, the McKnight Foundation worked with the people of Greater Minnesota to plant seeds of hope for a struggling state. Today, McKnight works in partnership with the resulting Minnesota Initiative Foundations to extend broad limbs of support across our region. Beneath them all lie deep Minnesotan roots and a fundamental philosophy of self-determination.

William L. McKnight was born in a farmhouse in South Dakota. He moved to Minnesota as a young man and eventually became an early leader at the 3M Corporation. William and his wife Maude L. McKnight lived the majority of their lives and raised their only daughter, Virginia, in Minnesota. In 1974, Virginia McKnight Binger became the Foundation's president. Like her parents, Virginia felt a personal tie to Minnesota; she also made a home and raised her family in the state.

Today, the families of William and Maude's grandchildren and great-grandchildren constitute the majority of the Foundation's board. Though program specifics and funding strategies have shifted occasionally in more than 50 years and over four generations, the Foundation has remained firmly committed to helping the people of Minnesota.

or The McKnight Foundation, helping Minnesota means helping all Minnesotans—across economic levels, diverse cultures, and geographic regions. About 40% of the state's population lives outside the Twin Cities. Each year, on average, 75% of McKnight's funding is distributed within the state of Minnesota; of that, 25% supports work statewide and an additional 24% targets efforts specific to Greater Minnesota.

To undertake efforts throughout Greater Minnesota, six of McKnight's key partners since 1986 have been the Minnesota Initiative Foundations (MIFs). The MIFs received roughly 10% of the Foundation's grantmaking dollars, about $9 million, in 2005.

Chairman of 3M's board of directors from 1949 to 1966, William McKnight built a successful corporation around his own philosophies of business management. Chief among his core beliefs were to "delegate responsibility and encourage men and women to exercise their initiative." Forty years later, in 2006, the MIFs mark their 20th anniversary. McKnight board chair Erika L. Binger, William and Maude McKnight's great-granddaughter, recognized the milestone with the following historical perspective, excerpted from the Initiative Foundation's Initiative Quarterly magazine in the summer of 2006.

As a seminal business leader, William McKnight sought—in his own words—to "discover and extract untapped potential in ideas, people, and markets, initiating and leading change while stimulating ongoing improvement and growth." In Erika Binger's retelling of the story behind the MIFs' development and history, the vision and spirit of McKnight's original founder is clearly evident.

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The Grand Experiment
Erika L. Binger, Chair, The McKnight Foundation
(Excerpted from Initiative Quarterly, spring 2006)

Over the past 20 years, the Minnesota Initiative Foundations—originally known as the Minnesota Initiative Funds—have become enormously powerful and valuable regional institutions. By adapting local support to each of their own communities, the Foundations foster growth and vitality in their regions while bolstering the economic health of our entire state. As successful as the Initiative Foundations are today, it's interesting to note that they started out, to some extent, as a grand experiment.

By the mid-1980s, rapidly declining demands for farming, mining, and lumber led to the disappearance of entire economic markets in Greater Minnesota. The McKnight Foundation had previously funded limited programs to support families and communities statewide—but McKnight's board of directors was becoming increasingly aware that citizens in rural Minnesota were facing unprecedented challenges. McKnight's board visited small towns and confirmed that the people of rural Minnesota held the capacity and resilience to most effectively address their own economic and community challenges, given appropriate resources.

The board considered using McKnight's resources to establish a mechanism through which local people could decide and act upon local issues. It would need to be sturdy enough to stabilize economies and communities, but flexible and strategic enough to build capacity and infrastructure to address future challenges and regional opportunities.

McKnight invited 60 rural leaders from around Minnesota to consider potential structures and strategies to help minimize effects of the economic downturn and prepare for the future. The result was the Minnesota Initiative Funds. Each of the six Funds was to be independent, with its own specific geographic scope, board of directors, and distinct identity. Initially, the Funds set out to help individuals and families cope with poverty. Each Fund surveyed its own community to identify pressing social needs and strategies for solutions. And the Funds didn't stop at simply addressing current challenges.

The Funds' boards advocated establishing and nurturing new businesses to help protect against future economic collapse. The Funds created six business development and loan programs, each customized to its own region. Now called the Initiative Foundations, they continue to strengthen their local communities through work in human services, employment support, leadership development, and community capacity-building.

McKnight didn't necessarily intend to remain in partnership for more than two decades. But year after year the Initiative Foundations have increased their impact, addressing emergent issues and seizing opportunities; for McKnight, continuing to invest in the Initiative Foundations has made great sense.

Since 1986, McKnight has granted around $200 million to the Foundations. They have translated those dollars into 2,800 business loans totaling over $130 million, and made a combined 12,000 grants totaling $91 million. Together, the foundations' endowments now total over $160 million, with revolving loan assets of nearly $60 million. The Foundations' current assets roughly equal McKnight's long-term investment. In strategic local outcomes, however, their increased value is incalculable.

At McKnight, we are extremely proud of our early involvement in the development of the Foundations, as well as our ongoing partnerships. The thoughtful leaders and community partners of each region deserve full credit—and McKnight's gratitude—for more than 20 successful and productive years.

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illiam McKnight's trust that good people with appropriate resources will make good decisions has borne great fruit over the past 20 years. The MIFs remain one of Minnesota's most powerful success stories, and the tens of thousands of Minnesotans they have served continue to strengthen the state. The MIFs' inherent spirit of innovation and self-determination is a fitting legacy to William McKnight's distinctive business philosophies.

In 1948, William L. McKnight, then president of 3M Corporation, said of the company he helped cultivate: "As our business grows, it becomes increasingly necessary to delegate responsibility and to encourage men and women to exercise their initiative... Those men and women, to whom we delegate authority and responsibility, if they are good people, are going to want to do their jobs in their own way... [It's] essential that we have many people with initiative if we are to continue to grow."

Mr. McKnight passed away in 1978. Although he was not around when the MIFs took off some eight years later, all signs indicate he would be proud of their successes, compassion, and hard work over the last two decades. Today, the core business of our state—how all Minnesotans connect and prosper together—is stronger, thanks to the responsibility and the "initiative" of the Minnesota Initiative Foundations.

Related links

Minnesota Initiative Foundations

Northwest Minnesota Foundation
Northland Foundation
West Central Initiative
Initiative Foundation
Southwest Initiative Foundation
Southern Minnesota Initiative Foundation

Initiative Quarterly magazine