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naming rights

The Michael G. DeGroote Centre for Learning and Discovery at McMaster University in Hamilton, Ont. Michael DeGroote donated $105-million to the school of medicine in 2003. It was a ground-breaking sum that spurred others to make significant new donations for buildings and programs at the university.

When billionaire entrepreneur Michael DeGroote gave $105-million to McMaster University in 2003, the donation marked the largest single private gift to a Canadian university.

The record still stands.

The ground-breaking gift to McMaster's School of Medicine, the first medical school in Canada to be named for a benefactor, embodies key building blocks in the successful courting of a major donor: a meaningful long-term relationship and a compelling story to inspire the philanthropist.

For McMaster and Mr. DeGroote, both based in Hamilton, Ont., the relationship dates to the early 1990s when the business figure made his first gift of $3-million to McMaster. His most recent gift to the university came in 2014 with $50-million for medical-related research and commercialization.

Essential to building the relationship is a compelling story to inspire the donor.

"You can't make it up and it has to be real," says Roger Trull, who was McMaster's vice-president of fundraising for the recording-setting gift in 2003. "But to get someone to join the journey [for the university] going from good to great is what it is all about and what most large gifts are all about."

A little luck helps, too.

In the late 1980s, by then a wealthy businessman who made his start in trucking and then moved into waste management, Mr. DeGroote had no history of philanthropy. Then-McMaster president Alvin Lee knew him a little socially but credits a mutual friend, Bill Cooper, president of Mississauga-based Cooper Construction, with nudging Mr. DeGroote to think about giving to the university.

One early Saturday morning while out for a run on a country road near his West Flamborough home, Dr. Lee says he bumped into Mr. DeGroote walking his dog near his estate. "In the conversation he said, 'I would like to make a contribution to your business school and how would you like $3-million?'" says Dr. Lee. "I said, 'That's wonderful.'"

A few days later, Dr. Lee says he met Mr. Cooper, who told a story of flying home from Florida the previous week in a private jet piloted by Mr. DeGroote. "They hit a particularly rough electrical storm and the plane was bumping around," says Dr. Lee. "Mike leaned over to Bill and said, 'I think I had better make my decision about McMaster.'"

Mr. DeGroote's 1992 donation to the business school –which bears his name and marks the first naming rights for a Canadian business school – led to others, spurred by him, contributing to the $11-million campaign for the school, according to Dr. Lee.

That year, the university presented Mr. DeGroote with an honourary degree, one example of university efforts to nurture a relationship. "He [Mr. DeGroote] got engaged more and would come to events," says Mr. Trull. "We would keep him informed about what was happening at the university."

Informing and involving a donor is key, he says. "In Mr. DeGroote's case, that's exactly what happened. He became involved enough to know the people and build personal confidence in their ability to deliver things they said they were going to do."

In 1995, when government funding was tight, newly installed McMaster president Peter George recognized the imperative to recruit private donors.

"He [Dr. George] said, 'If we rely on government funding, we can be good and can continue to be good, but if we want to be excellent and world-class we need private financial support,'" says Mr. Trull, of the late president who died in April.

"I think we learned a lot of lessons along the way – the biggest one being this [fundraising] is a long-term thing," observes Mr. Trull. "It is about engaging the donor in the life of the institution and helping them to understand the impact they can have not just on the institution but on society in general."

Securing a $105-million gift, however, marked a new order of magnitude.

"It obviously sets an incredible bar in terms of impact," says Susan Storey, senior vice-president of Ketchum Canada Inc., a fundraising consultant firm. "We know that donors are giving on the basis of wanting to have an impact on issues they care about."

In her experience, a decision to name a building comes well after a discussion about the purpose of a gift.

"That is a really important message," she says. "Donors want to fund issues where they want to see impact and understand the value of the gift and how it will make a difference." Naming rights, she adds, "is never at the forefront of a discussion."

In Mr. DeGroote's case, his strong interest in health issues meshed with the university's ambitions to invest in a medical school already recognized globally (ranked 27th in a top-100 list of medical schools by the Times Higher Education World University Rankings) for innovative teaching and research.

In tandem with Dr. George, as president, and Dr. John Kelton, then-dean of the medical school, McMaster's fundraising staff drafted a proposal that, says Mr. Trull, "we thought would lead to McMaster's medical school being considered the best medical school in the world."

The proposal included a significant endowment to recruit top researchers and invest in laboratories and equipment. As well, $26-million was earmarked for the Michael DeGroote Centre for Learning and Discovery, a new 300,000-square-foot building for classrooms, labs and faculty offices adjacent to McMaster Health Sciences Centre on campus.

For McMaster, Mr. DeGroote was an obvious potential donor. "We knew him well enough to believe that it was the kind of thing he could get excited about," says Mr. Trull, with discussions with the donor held over a year. "At the end of the process he came to understand what $105-million could do and he was generous enough to provide it."

Presenting an ambitious agenda for a top-rated school fit Mr. DeGroote's own business philosophy, according to Dr. Lee.

"It is true that Mike is a real world-beater and that is manifestly true in his business," says the former president. "He has been very successful but he is the kind of person who goes for the champion … I know it was the eminence of the McMaster medical school that finally captured his real imagination. He knew this was a world-beater, innovative medical school and he liked helping it and being associated with it."

At the time, recalls Mr. Trull, McMaster officials had some concern that such a large gift could scare off future donors.

Instead, in subsequent years, the university received significant new donations for buildings and programs, led by notable Hamilton-area business leaders including Ron Joyce, the co-founder of Tim Hortons, David Brayley, the former owner of the Hamilton Tiger Cats and Toronto Argonauts CFL football teams, and Michael Lee-Chin, a Jamaica-born investor and philanthropist.

"What we learned," recalls Mr. Trull, who retired in 2011, "and what others have learned since, is that people want to support a winner and they want to get on board."

Rob's choice of travel reward programs is one that gives cash back, instead of points.

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