Business Recognition Fosters Financial Security

The Chase Family

This case describes how a family business had such brand equity that it used an innovative program of private philanthropy to protect the family and the business for many generations.

In 1932 Philip Chase was optimistic that the Depression would end and the United States economy would get better soon. He acted on this belief and in September of 1931, he purchased a struggling summer boys camp, Camp Sabattus, in North Lovell, Maine. It was not just a business venture; Philip had gone to the camp as a boy and later was a counselor for three years and still felt the emotional “pull” of the Camp and its memories. He wanted that “pull” every day for himself and his family. His boys, Philip Jr. and Bill were then 5 and 3 years old.

The first camp season (1932) only involved 41 boys including Philip’s two sons (the facility was designed for 150 boys for the then traditional 8 week season). The previous summer the camp only had 30 campers and 28 returned for the 1932 season. Philip and his wife, Mary, handled many positions that summer. Mary was camp nurse (she had graduated from the Maine General Hospital School of Nursing in 1926 and worked there until the beginning of camp season in 1932). She also helped cook; did the books; corresponded with parents and ran rainy day activities. Philip was a competitive swimmer at Kimball Union Academy where he went to prep school (a Chase family tradition) and Dartmouth College so he naturally ran the swimming program, including the Red Cross Junior Life Guard program. Phillip wanted to make sure that every camper went home with above average swimming skills. Those 1932 campers had access to many activities including tennis, canoeing, sailing, fishing, camp craft, archery, and riflery. New boys always favored riflery so the riflery instructor was a key position warranting not only a skilled person but also someone who was mature and would emphasize safety above all else. The rifles used were an assortment of 22 caliber guns (a Mossberg, several Remington’s and a Winchester). Everyone was well cared for with a plan for learning at the beginning of summer. One boy, Henry Seiler, from Meredith, N.H. shot a “possible,” which means that his 5 shot score was 50, hitting the small bull’s eye from 50 feet with each shot. That target, now ragged, is under glass and still on the wall of the lodge.

The Boys from the City Marveled at the Silence

The boys from the city marveled at how quiet the clearing in the Maine woods was. The in-camp activities were great but the feature of the camp was its trip program. These adventures included canoe trips down the Saco River for the younger boys and similar trips down the early stages of the Crooked River with its multiple rapids to test the skills of the older campers. The mountain climbing program had the benefit of the nearby Appalachian Trail and the special part of it called the Mahoosuc Trail. Nearby Speckle Mountain and the ice cold river at it base was a favorite trip especially when it was an overnight trip. Boys could float in the narrow river sliding down the age weathered rock base usually without bathing suits (no other humans were anywhere near) and sometimes in little pools could catch small brook trout in their hands. At one special spot in the river there was a deep bathtub like pool with a waterfall coming over the up- stream edge, making a natural shower for those who would brave the icy water. The boys from the city marveled at how quiet the clearing in the Maine woods was at night with the stars seeming to touch the nearby tree tops. They had never been in a place free from man made noise before.

At the end of the 1932 camp season, the Chases knew they had to have more boys for the next season or the camp would not survive. They started their first marketing campaign the Fall of 1932, visiting the homes of more than 12 boys asking the parents to invite friends who had camp age sons to a gathering where the Chase’s showed camp pictures and a short 8 millimeter film of camp life. Philip was a natural salesperson and his love for Camp Sabattus was evident as he described the benefits of its program for young men. June 23, 1932 brought 75 boys to the shore of Kezar Lake which made for an exceptional summer program and a financial success as well.

As the years passed, the camp expanded to permit 300 boys and had ever increasing trip and in-camp programs. By 1960 it was routine to take multiple groups to spend 4 or 5 days in Baxter State Park, usually staying at the Chimney Pond camping area, to climb Mt. Katahdin (the boys liked the Knife Edge Trail); take 2 groups to canoe the Allagash River; and take groups to the St. Croix River on the Maine Canadian border and brave the difficult rapids there downstream from Vanceboro, Maine. These rapids were always exciting and sometimes very dangerous depending on the flow rate from the dam in Vanceboro.

In 1962, Philip unexpectedly died just before camp season began. His oldest son, Philip Jr., then age 35, took over the leadership role as he and his brother inherited the camp. Philip Jr. had been a full-time Camp Sabattus person all his life and had been well groomed by his father to become the camp leader. Bill was a general surgeon in Boston and although he too loved the camp,  decided to continue with his career. He visited as often as he could and his sons became campers at an early age. Mary lived at the camp in the summer and added a level of maternal stability that all appreciated.

Late in 1962 Philip Jr. saw an opportunity to do a real estate development on land in Newry, Maine adjacent to Sunday River, a new ski resort which opened in 1961. He purchased 50 acres for the development. Philip worked with a local contractor who persuaded him to do the entire infrastructure and build 5 ski dorms for discount rooms during ski season, 8 chalets to be sold, and a small motel for families before finding any buyers or securing reservations for the ski dorms or motel. The project took all the money Philip Jr. inherited. He also had to have Camp Sabattus guarantee the loan needed to complete the project. The development was not successful; Philip eventually had to sell it for much less than he had in it. He persuaded the bank to transfer the remaining debt to the Camp and promised to pay off the loan from the profits of the Camp. The bank agreed. Bill reluctantly went along with this but rightly worried about how the Camp could do all this. For the next 10 years Philip Jr. struggled but was able to handle Camp obligations and also carry the extra debt service from the failed real estate development. It certainly was not easy. He had to “manage” his payables; sell timber off the camp property and sell some lots from the lake frontage owned by the Camp.

Philip Jr. was married when he took over camp leadership and his wife Sally was always by his side in all camp matters and agonized with him over the finances. They had two children, a son, Carl, and a daughter, Wendy, both of whom were part of the life at camp.

Philip Struggled the Next 10 Years

For the next 10 years, Philip struggled. It certainly was not easy. Philip Jr. was a great camp leader and was respected for his ability to attract campers and provide them with an exceptional experience. Camp Sabattus, like many of its colleague camps in New England, were owned by families who devoted their lives to the campers who came in the summer and the counselors who staffed the camp. Camp traditions such as awards to campers for athletic and citizenship successes along with Sunday service and special campfires especially at the end of camp season infused the campers and counselors alike with an emotional and healthy attachment to the Camp and its owners. That attachment is not usually found in a profit-making environment, but it in fact exists throughout the camping industry. Anyone who has attended a family-owned camp with a program designed to have an 8 week full season and a 4 week half season will understand the lasting emotion created by the experience. In addition the parents of campers see the positive effect camp had on their sons and as such share the emotion.

In 1984, Philip Jr. met David Reed, an accountant, at an Institute For Family Business meeting in Portland, Maine where David, an Institute founder, was the speaker for the event. That day David was speaking about the value of a family business having a board of directors or a board of advisors. Philip thought about the talk all the way back to Lovell and after speaking to Sally called David to make an appointment. During that call Philip Jr. and David spoke about camp life and David mentioned to Philip Jr. that he grew up in Lovell but went to Camp Wildwood several towns away for 3 summers and was a counselor for three years later. David asked if they could meet at the Camp instead of Philip coming to Portland. Philip readily agreed especially when David told him the first meeting is free.

That first meeting in 1982 was the beginning of a long business relationship and friendship. David helped Philip refinance the camp debt, purchase the stock owned by his brother, and initiate a board of advisors. The Camp’s tight cash position was a constant topic. David tried to get Philip to explain to his two children, who were in their mid 20’s by then, the financial situation of the Camp. Philip knew he should do so but never could bring himself to actually talk to them about the finances.

In 1988 David was in Philip’s office at the Camp again discussing the Camp finances. The relationship with the bank was getting more difficult as the local bank had been acquired and the new loan officer was asking a lot more questions. David did not want to make Philip Jr. feel any worse but felt he had to say that it was crucial to figure out how to stabilize the Camp finances as Philip Jr. and Mary were getting older and he knew they did not want to leave the Camp to the children burdened by debt.

The Banking Relationship Became More Difficult

Philip stated that he and Mary talked about that constantly and had thought about selling the Camp but knew any buyer would probably close the camp and sell off the almost one mile of shorefront. They also had spoken to two other camp leaders who had converted their camps from profit making organizations to charitable organizations qualifying under Section 501(C)(3) of the Internal Revenue Code. David said he had experience with camps which had converted and said those families who did so later had mixed feelings about that decision. David really did not like the idea of the Chase family restricting future generations of the Chase family to a life under the restrictions imposed by charitable organization rules. There was a pause in the conversation as both David and Philip listened to the call of a loon on the lake but out of sight. It is a lonely but delightful sound. Maybe even inspirational.

David never knew where the idea came from but there on the shore of Kezar Lake a new concept was born when David said he thought Camp Sabattus and the Chase family could initiate a development program just like a charitable organization even without the ability of “donors” to obtain a tax deduction for money given to the Camp. Philip was skeptical and later so was Mary. David, however, got more enthused about his idea the more they talked about it. David knew from lots of experience raising money for the schools he attended and other charitable organizations that the key motivating factor in the minds of most donors was the emotional relationship the donor had with the organization. David knew that the constituents of Camp Sabbatus had that emotional attachment and it would potentially result in gifts to ensure the future of the Camp and the leadership of the Chase family.

It took many more conversations and seeking the advice of a friend and development professional to actually start a modest campaign. Philip was still very reluctant to seek money from former campers and the parents of campers as he was uncomfortable about asking for money for his family. David kept saying the money is to allow future young men the opportunity to come to Camp Sabattus under the leadership of the Chase family. David, ever careful with his own money,  surprised himself and probably influenced the decision by personally offering to pay the development professional’s fee as the first gift to the campaign. It took a lot of work as most development projects do, but the concept was proved by the numerous cash gifts from the Sabbatus Family. The Camp was able to protect its financial future so that many more young men could come to the shore of Kezar Lake under the caring guidance of the Chase Family.

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David Hawkes (aka David Reed) is a tax, financial planning, family & small business consulting expert. He has worked with thousands of clients and saved them millions of dollars in taxes over the course of his career. David is also a former minority shareholder of the Boston Red Sox.