This paper aims at designing a conceptual strategic framework for financing foundations (non-profit organization that finance operating intermediaries with grants, debts or equity) by identifying the key strategic choices they face. Traditionally, the research on strategy has rather focused on profit-seeking organizations whose primary objective is to generate wealth for shareholders i.e. capture value. Nevertheless, the question of strategy really matters for financing foundation whose primary objective is to create value. Indeed, during the last decades, these organizations have made a breakthrough in Europe by establishing themselves as private actors that will look after the public interest. In European countries, however, the Welfare State has always been considered as the key actor in charge of the public interest. Foundations hence face the challenge of legitimacy. In addition, there is a stronger demand for efficiency reinforced by the emergence of new models of philanthropy inspired by corporate management principles. The search for legitimacy and impact and the evolution of the environment in which financing foundations play advocate for the development of a clear vision of the social value they want to create and how they plan to do it. In this paper, we define what a financing foundation is and highlight its hybrid nature by comparing it to other financing organizations. We then explore the concept of strategy and review the current literature in philanthropy with a strategic focus. We finally present the conceptual strategic framework before discussing the new research avenues raised by the conceptual model developed.
