A few days before Christmas in 1980, the actor Paul Newman called his friend A.E. Hotchner with a request: "How about coming over and giving me a hand with something?" What waited, as the writer Mark Seal tells it in a Vanity Fair account excerpted by Longreads, was "a big washtub of vinegar and olive oil and condiments and a lot of dirty wine bottles." That salad dressing became one of the strangest and most generous businesses in American history.
From washtub to "give it all away"
Newman had been bottling his dressing and giving it away for years. That night he and Hotchner "tied ribbons around the wine bottles, gathered their kids, and went Christmas caroling," handing out bottles as they went. A neighbor, a young caterer named Martha Stewart, held a blind taste test, and Newman's came out on top. In 1982 the dressing went on sale in local shops, with Newman's face on the label. "To our absolute disbelief, we banged quite a profit that first year," Hotchner recalled. Seal puts the figure at $920,000, and Newman's reaction, as Hotchner told it, was this:"We can't be in the business of making money off of it!"
According to the Newman's Own Foundation, his rule from 1982 on was simple: "Let's Give It All Away." The foundation is careful about the wording. "100% of profits from Newman's Own go to good causes," it says, and adds, "That's 100% of profits—not proceeds." The difference matters. Many products promise that "a portion of proceeds" helps a cause. Newman's Own gives away everything left after the costs of making and selling the food.
The giving added up. Newman's Own says "over $600 million has been donated to good causes since 1982." The foundation calls that a milestone it reached in 2022, more than 40 years after the first bottles.
A camp where kids could "raise a little hell"
The best-known thing the money built is a summer camp. The Hole in the Wall Gang Camp in Connecticut "was founded in 1988 by Paul Newman" for children with serious illnesses, with an Old West setting inspired by his film Butch Cassidy and the Sundance Kid. The point was to let sick kids be kids, or as the camp puts it, to "raise a little hell," free of charge for them and their families. It grew into the SeriousFun Children's Network, which now counts "30 independently owned and operated camps and programs," still "always free of charge."
The model even changed federal law. Private foundations generally can't own more than 20% of a for-profit company, so the foundation faced having to sell off at least 80% of the business. In February 2018 the president signed what the nonprofit law firm Perlman & Perlman describes as the "Philanthropic Enterprise Act of 2017," part of the Bipartisan Budget Act of 2018. It lets a foundation own a company outright if, among other conditions, the company pays out all of its net operating income to the foundation and runs independently of the foundation's big donors.
The foundation sums up Newman's view with a line it attributes to him: "When you see the right thing to do, you better do it." It's not a bad motto for a man who could have kept the money and didn't.
Today's act
The act: Borrow Newman's trick on a small scale. Pick something you already make well, and give it away in exchange for a donation to a cause you trust, especially one that helps kids.
- Make one batch of your best thing (cookies, hot sauce, granola, a knitted hat) and offer it to coworkers or neighbors for a donation of any size.
- Choose the charity first, and give 100% of what comes in, not "a portion." Cover the ingredients yourself.
- Can't cook? Offer a skill instead, like an hour of yard work or tutoring, on the same terms.
- Send everyone the donation receipt total afterward, so they know where the money went.
Give well
When a product says it supports a cause, read the fine print. "Profits," "proceeds," "a portion" and "up to" mean very different amounts, and buying something is not the same as donating (you can't deduct your salad dressing). If you'd like your money to do the most, giving directly to a vetted charity usually beats shopping for one. Our guide to vetting a charity and the quick charity checklist can help you pick where your bake-sale money goes, and effective giving covers how to compare options.
Sources
- Longreads — The Newman's Own Origin Story (excerpting Mark Seal, Vanity Fair, Aug. 4, 2015)
- Newman's Own Foundation — One-Page Backgrounder (2024)
- Newman's Own — About Us
- The Hole in the Wall Gang Camp — Founder & History
- SeriousFun Children's Network — Our Story
- Perlman & Perlman — Newman's Own Gets a New Life: The Philanthropic Enterprise Act