How Foundations Can Bring Equity Philanthropy to Local Communities

How Foundations Can Bring Equity Philanthropy to Local Communities

Foundations have always been a backbone for nonprofit growth and innovation. Now, they’re uniquely positioned to lead the next wave of transformational giving: early-stage equity donations.

Business owners want to give. Nonprofits want to grow. But the bridge between them—especially when it comes to private equity—has been too complex for too long.

That’s where you come in.

The Opportunity: Equity Gifts Before the Sale

Many entrepreneurs are sitting on their most valuable asset: ownership in a company. But they often don’t realize they can donate a portion of that equity before selling it.

And when they do, the impact is enormous:

• No capital gains tax

• Full-value charitable deduction

• Larger gifts to community nonprofits

Foundations can play a key role in making this accessible—especially for smaller organizations that wouldn’t otherwise be able to accept these complex gifts.

How Foundations Can Lead

1. Educate Nonprofits in Your Network
   Host workshops, share guides, or offer toolkits that explain how equity donations work.

2. Sponsor Donor-Advised Funds (DAFs)
   Provide local infrastructure for receiving private stock, holding it until liquidity, and granting it to nonprofits.

3. Support the Ecosystem
   Partner with platforms like Donate Equity to automate the deal process and remove the legal and tax burden from grantees.

4. Normalize It Regionally
   Start conversations with donors early—well before a liquidity event. Encourage local entrepreneurs to “pledge equity” just like the big tech founders do.

Why Now?

Because these gifts are often left on the table. Founders don’t realize they can give early. Nonprofits don’t know how to accept it. But foundations? You can close the gap.

You have:

• Trust with both donors and nonprofits

• Infrastructure to manage funds

• The power to lead a cultural shift in your community

The Takeaway

Equity donations aren’t just for Silicon Valley. They’re for Main Street too.

With the right guidance, tools, and foundation support, equity giving can become a norm—not a novelty—in your region.