FAQ
What is a Curated Impact Vehicle, and how does it work?
With Bespoke Impact Philanthropy, you can easily create a customized giving strategy that aligns with your personal philanthropic goals, all through a Donor-Advised Fund (DAF). This approach gives you more flexibility and control over where your donations go, without adding extra work on your end.
We’ll work closely with you to:
- Focus on specific causes and organizations you care about.
- Tailor a personalized grant-making strategy that reflects your goals.
- Brand and position your impact vehicle based on your preferences.
- Maintain full control over how your funds are used.
This process is streamlined and handled by our team, ensuring that you can focus on making a difference while we manage the details. It’s an easy, customized solution that allows your philanthropy to have a direct, measurable impact.
What is Bespoke Impact Philanthropy?
Bespoke Impact Philanthropy allows you to make charitable donations while supporting early-stage, high-impact companies. By donating securities (e.g., stock or equity) in these companies to a Donor-Advised Fund (DAF), you can receive a tax receipt and benefit from future upside if the company succeeds.
How does Bespoke Impact Philanthropy work?
- You donate securities in an early-stage company to a DAF.
- The DAF provider values the donated securities and issues you a tax receipt for the full fair market value.
- The DAF holds/owns the securities, allowing them to appreciate over time, exempt from income taxes.
- You direct how the DAF funds are granted to charitable causes.
- If the company has a liquidity event in the future, the DAF can sell the shares, and the proceeds are granted to your chosen charities.
How does Bespoke Impact Philanthropy get compensated?
BIP takes no money from philanthropists or your donations. With BIP’s relationship with our sister company, NextRound.ai, we have the option to receive equity or options in these companies at a higher valuation than the current round. If the company doesn’t exceed that valuation, BIP gets nothing. Our compensation is tied to the success of the companies we support, ensuring we are fully aligned with both the philanthropists and innovators to create lasting, transformative change.
Where do I find companies for my tax-deductible contributions?
You can donate to the companies of your choice or selected from BIP’s rigorously pre-vetted innovators who can make real change in impact-driven industries. Philanthropists know exactly where their money is going, and they can be confident it’s backing meaningful solutions. The source of our innovators is NextRound.ai our sister company and NextRound’s fees are spelled out plainly–fees payable by the innovator.
Why should I consider donating through a Donor-Advised Fund (DAF) instead of a traditional charity?
Traditional charities often have high overhead costs, meaning only a portion of your donation reaches the cause. With DAFs, you can donate assets like stocks or securities, receive an immediate tax deduction, and retain control over where your funds are directed—ensuring your donation makes a greater impact on the causes you care about.
Can I still make donations to traditional charities through a DAF?
Yes! DAFs are flexible, so while Bespoke Impact Philanthropy focuses on high-impact investments, you can also choose to direct grants to traditional charities if you prefer.
How can I use DAFs to secure funding for my company?
Investors donate their securities (such as a SAFE or convertible note) to a DAF, receiving an immediate tax deduction while your company retains the capital for growth. This provides a new way to fund high-impact sectors like healthcare, biopharma, and climate initiatives.
Can Canadian investors use DAFs to invest in my US-based company?
Yes! Canadian investors can invest in US companies through a DAF and still receive significant tax benefits. We have contacts with Canadian DAFs who have agreed to accept equity from our portfolio companies, allowing donors to make a long-term impact.
What other benefit does donation bring to raising capital?
Tax planning for individuals forces action before the end of the calendar year (December31). Therefore, if investors wish to take advantage of this method, they should have committed to this idea before mid-December. If a corporation is considering this, then they have to act before the end of their fiscal year.
What are the tax benefits of donating to a DAF?
- Immediate Tax Deduction: You receive a tax deduction based on the fair market value of the donated securities.
- No Capital Gains Taxes: You avoid paying capital gains tax on any appreciated securities you donate.
- Tax-Free Growth: Any growth in the value of the donated securities within the DAF is tax-free.
How is the fair market value of my donated securities determined?
The value is determined through a formal appraisal by the DAF provider, based on market conditions at the time of the donation. We work with trusted partners to ensure accurate and fair valuations.
Are there any fees associated with DAFs?
- Annual Management Fee: DAF providers typically charge around 1% of the donated assets as an annual management fee.
- Valuation Fee: There may also be an upfront fee for valuing the donated securities, usually between $15,000 - $25,000.
- Both fees can be paid directly by a donor at may be tax deductible, or the amounts can be donated to the DAF and the fees will be collected from inside the DAF.
How can I use the DAF strategy for investors who are hesitant to contribute more?
Some investors may hesitate to invest more due to risk or liquidity concerns. The DAF strategy allows them to donate part or all of their existing investment (e.g., SAFE or convertible note) to a DAF, receive an immediate tax deduction, and still direct future gains to charity. This way, they remain involved without committing more capital upfront.
How long does the DAF process take?
The valuation and issuance of a tax receipt usually takes a few weeks once the securities are donated. We guide you through each step to ensure a smooth and efficient process.
Do you have investments that you can’t get a tax write-off for?
If you have investments that you can’t claim a tax write-off for—due to illiquidity, expired losses, ownership changes, or regulatory restrictions—we can help. By donating these investments to a DAF, you can claim a tax deduction, and use the savings to reinvest in high-impact companies.
What happens if the company (whose securities I donated) doesn't succeed?
If the company doesn’t succeed or there’s no liquidity event, the securities remain in the DAF. While there may not be future gains, you still benefit from the immediate tax deduction based on the fair market value at the time of donation.
How do I explain the DAF strategy to an investor who is reluctant to invest more?
Here’s an easy way to explain it:
"We know you’ve already invested in our company, and we understand you might not want to invest more at the moment. But there’s an option that could make your original investment more beneficial. If you donate part of your current investment (like the SAFE or convertible note) to a DAF, you’d get a tax deduction, and you can still direct future gains to a charity or reinvest in other opportunities. This way, you make the most of your current investment without adding more risk."
Can I recommend specific investments for my DAF?
Yes! You can work with your DAF provider to recommend specific investments or charitable distributions, giving you flexibility in how your contributions are managed.
How long does the DAF process take?
The valuation and issuance of a tax receipt usually takes a few weeks once the securities are donated. We guide you through each step to ensure a smooth and efficient process.
Michael Porteous
CEO
