Twin Cities United Way CEO Sarah Caruso to retire

Greater Twin Cities United Way CEO Sarah Caruso will retire in July as the philanthropy struggles with declining fundraising numbers.

Caruso, 59, served as president and CEO for nine years, leading the agency to a record $101.9 million in revenue in fiscal year 2014 — in preparation for the charity's centennial year. But that has fallen to $77 million last year as donors moved away from the philanthropy's workplace giving campaigns.

United Way Board Chairman Tim Welsh said the board is grateful for Caruso's accomplishments, including leading a team that raised $820 million during her tenure and marshaled 4 million volunteers. Caruso led the Twin Cities organization to national prominence by founding a digital strategies group with 22 local United Ways and oversaw the creation of a new strategic plan last year to address changing donor preferences that favor online giving tools and more control over how their money is spent.

"As you look at the nine years Sarah has been in leadership, it's pretty extraordinary what she has done," Welsh said. "You have a leader who has made the community more vibrant, more prosperous. That's a pretty impressive legacy."

"We did not ask her to leave," Welsh said.

Caruso said that after 15 years at the helm of Twin Cities nonprofits, now feels like the right time to retire. "Tim and I have been in conversation about this for a while. We made the official decision ... about a month ago," Caruso said. "I've accomplished a lot and the organization is in a good position to bring on a new leader."

United Way director Karen Richard, senior vice president of human resources at Andersen Corp., will lead the CEO search committee. Trent Blain, United Way's vice president of marketing, will serve as interim president until a new leader is on board.

Welsh said he hopes to have a new CEO in place by the end of the year.

The new CEO will jump into ongoing work to implement United Way's new strategic plan with less reliance on workplace giving, which accounts for about 90 percent of its donations. New strategies include courting individual donors outside the office, promoting community giving groups around topics that inspire passion, offering fee-based consulting services to businesses with philanthropic arms, and building United Way's $52 million endowment with legacy gifts to smooth the ups and downs of annual giving.

Caruso faced a tough shifting landscape in the past few years, said Jon Pratt, executive director of the Minnesota Council of Nonprofits.

"It was a challenging job at a difficult time, being in charge when you have to make cuts. There is no good place to cut. Part of the pain was the short notice," said Pratt, pointing to the $6 million revenue shortfall in 2016 that resulted in 11 layoffs, across-the-board cuts to grants for all recipient nonprofits and the elimination of family violence prevention and elementary school reading programs. "If only there had been the ability to foresee: What are the trends facing the agency?"

The success of the next CEO will depend on the ability to connect to community stakeholders and anticipate changes, he said.

Caruso was born and raised in St. Paul and earned a bachelor's of economics from Smith College and an MBA from Stanford. She spent the first half of her career in corporate America as a commercial banker, marketing manager at General Mills and outside consultant. Caruso jumped to the nonprofit sector as the president of the Minnesota Children's Museum from 2004 to 2009.

She became CEO of the United Way in the fall of 2009, in the midst of the recession, as the agency struggled with a $10 million one-year revenue drop.

Caruso led the United Way to recovery and grew revenue to nearly $102 million in less than a decade's time, according to tax records. At the same time, she shifted the charity's mission to more deeply address emerging community needs including hunger, housing and job training.

"We really doubled down on the safety-net aspects of our work," Caruso said. "As the economy has gotten better, it's been disappointing and a bit of a surprise the demand has been so high for emergency shelter and hunger."

R.T. Rybak, president and CEO of the Minneapolis Foundation, said Caruso coached him when he moved from the mayor's office to philanthropy leadership.

"She has a big heart but also the business training to understand the bottom line well enough to run a big organization," Rybak said.

He said Caruso was critical in establishing Generation Next, a coalition of civic, business, education and philanthropic leaders dedicated to closing achievement and opportunity gaps in education.

"Sarah stepped up and made it possible by having United Way be the backbone organization," Rybak said.

Richard Davis, former U.S. Bank CEO and former United Way board member, said Caruso understood early on the importance of pursuing individual donors outside the workplace and of connecting them to the charities their money was fueling.

"She took United Way into a more contemporary world," he said.

Caruso also led the agency into advocacy work, organizing stakeholders and research and pushing legislators to invest in early childhood education and job training.

She earned $450,326 in salary and benefits in 2016, according the most recent available tax filings. Her last day is July 15. She will then serve as an outside consultant to help the new leader in the transition.

Caruso said she will continue to support the United Way as a donor and has included the agency in her will.

"I am friends for life with United Way," she said.