Tag Archives: Tom Parker

Investing in Community and Getting Better Returns than Wall Street

Tom Parker has been marinating in Santa Barbara philanthropy since the 1950s when, as a kid, he and his dad would distribute food to Santa Barbara’s homeless through the local Kiwanis Club. Tom says philanthropy has always been woven into Santa Barbara’s fabric because it’s a small enough place where it’s easy to see the impact of one’s good deeds – and enjoy the gratification that comes with it. 

“Very few businesses give you the kind of feeling of fulfillment a nonprofit can,” says the third-generation Santa Barbaran and president of the Hutton Parker Foundation.

The Hutton Parker Foundation primarily focuses on supporting Santa Barbara nonprofits, especially in the areas of Education, Health & Human Services, Civic & Community Development, Youth & Family Services, and Arts & Culture. The Foundation was started by Tom and his aunt-in-law who are sort of a riches-to-rags-back-to-riches story – with many valuable life lessons learned along the way.

Parker did well in real estate investing as a young man, so much so that when the real estate portfolio of his wife’s beloved aunt Betty Hutton became distressed in the 1980s, Tom had the flexibility – and wherewithal – to move his family to Orange County to work with Betty for quite a few years whilst turning around her ailing business and her underperforming assets.

As with Parker, philanthropy was always a priority for aunt Betty. So as soon as Betty’s financial ship was righted and the family had “enough,” Tom and Betty funneled the rest of their assets into their newly formed Hutton Parker Foundation. “You get to a certain point where it feels better to give back than to consume. If you are fortunate in life, that’s not just an obligation, it’s an ingrained part of you.” Not surprisingly, Parker is grooming his sons Christopher and Jess to take over the foundation and carry on the family legacy.

Parker’s philosophy as a philanthropist is that most of the charities he focuses on are great at their primary mission, but their good deeds could go further if these nonprofits ran better, leveraged assets, and found productive synergies. To this end Tom sees himself as more of an aggregator and super connector rather than a micromanager. He uses lessons learned streamlining his aunt’s businesses and has innovated a system whereby multiple nonprofits pool resources and invest in local real estate, and frequently (with Tom’s help) buy the buildings where they operate.  

“The local nonprofits don’t just need monetary funding; they need entrepreneurial support, innovative ideas, and energy. All these charities do great work, I just try to help make sure their business plans are sustainable.”

– Tom Parker

To facilitate its mission, the Hutton Parker Foundation makes below market loans to nonprofits, buys buildings, and has housed 55 nonprofits in 17 renovated Santa Barbara structures, not just saving these organizations millions in operating expenses, but greatly benefitting the larger community of Santa Barbara. “The local nonprofits don’t just need monetary funding; they need entrepreneurial support, innovative ideas, and energy. All these charities do great work, I just try to help make sure their business plans are sustainable.”

Parker says the key to his system is identifying and sometimes synthesizing collaborations, or as he likes to say, “Whatever you do, try to make sure everybody wins.” By maximizing symbioses, Parker scores a quintuple win for nonprofits, the people they serve, other nonprofits they partner with, and the communities where they’re located. 

Parker’s system (known as “tenant equity”) has been so successful there’s even a book about it: The Hundred Million Dollar Secret: Why and How Foundations Should Invest in Community Instead of Wall Street. Parker says he wrote the book because he was a “boring lecturer.” Although that is likely a fiction, Tom’s book in fact proves that foundations can yield superior returns by investing locally rather than in an ordinary portfolio of stocks and bonds. 

Parker is also a big believer in the utility and importance of data: that how a place (or group) is doing can be measured, providing data that’s invaluable in terms of allocating resources and focusing efforts. This is one of the reasons Hutton Parker is a main underwriter of UCSB’s “Indicators Project” – which literally measures leading indicators in a multiplicity of categories, showing how various aspects of a hyper local community is doing or at least trending.

As recently as this year, Tom “reused” data collected by the United Way during relief efforts for undocumented residents in the 2018 debris flow to spearhead a new outreach to undocumenteds today, during the pandemic. “Investing in our local communities is like watering a thirsty plant – you can see the local communities springing back to life,” says Parker.

For his achievements in philanthropy Tom has been awarded Santa Barbara County’s Philanthropist of the Year Award, the Santa Barbara Chamber of Commerce Founders Award, the Anti-Defamation League Distinguished Community Service Award, the Women’s Economic Ventures Man of Equality Award, and countless others. More importantly, Tom Parker has won the respect and gratitude of thousands of Santa Barbarans, though it is very clear this is not why he does it.

“For me, it’s the ‘teach a man to fish’ thing,” says Parker. “Helping nonprofits work better and sustain over the long haul is much more satisfying – and ultimately more useful – than simply writing a check.”