Amid unprecedented economic fallout from COVID-19 and renewed racial equality and climate change action efforts, Social Finance is re-examining the role charitable capital can play in supporting local communities in need. Donor-advised funds (DAFs) are charitable giving accounts administered by public charities. Despite this, most of the $140 billion in DAF assets worldwide are invested passively in traditional market-rate investments that don’t directly contribute to charitable purposes.
Social Finance works with DAF sponsors, donors, and impact-first recipient organizations to drive DAF capital toward pre-packaged, place-based, impact-first investments that support small business loans, affordable housing access, nonprofit organizations, sustainable agriculture, and clean energy to under-invested communities, including communities of color. Our offerings are turnkey to meet the specific needs of our partners. We accomplish this by:
- Activating DAF sponsors through surveys to assess donor demand for impact-first investments and determining impact investing solutions that align with their donors’ philanthropic interests and their organizations’ charitable priorities.
- Engaging and galvanizing DAF donors via surveys, focus groups, webinars, and email campaigns.
- Curating, vetting, and packaging thematic portfolios of place-based, impact-first investment opportunities.
- Building the capacity of DAF sponsors to broaden their toolkit beyond traditional grantmaking to include recoverable grants and low-cost, impact-first loans.
“Silicon Valley Community Foundation believes we have the responsibility to help guide our donors in maximizing their philanthropic dollars not only through traditional grantmaking but also through place-based and impact-first investments. Partnering with Social Finance has allowed us to expand the tools we offer our donors to help them amplify their impact, achieve their philanthropic goals, and contribute to equitable recovery efforts.”— Nicole Taylor, President and CEO, Silicon Valley Community Foundation
DAF Market Research
We conducted extensive market research, with support from The Rockefeller Foundation, to determine whether there is significant potential to unlock DAF capital for the greater good through impact investing.
San Francisco Bay Area Impact-First Investment Pilots
Design and implement programs with the Silicon Valley Community Foundation and Jewish Community Federation and Endowment Fund of San Francisco to mobilize nearly $9 million of DAF capital to place-based, impact-first investments to equitably support low-income communities.
- “To Support an Equitable Recovery, Donor-Advised Funds Should Look Beyond Grantmaking,” Inside Philanthropy
Social Finance has a range of experience in structuring and managing different impact investments. Our team brings experience with program-related investments for private foundations, loans and equity investments directly into for-profit and nonprofit entities and through funds, recoverable grants from DAFs, and loan guarantees.