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Georgia-based Charityvest has just seen its mission to “catalyze generosity” extended far beyond U.S. borders, the prior geographical limit of the grants issued through its platform.
To enable international grant-making, the for-profit fintech firm in July established a partnership with TrustBridge Global, a Swiss charity that helps donors give globally through a network of partner foundations.
Especially for individuals, international giving can be slow and expensive, and it can also raise compliance concerns, says Stephen Kump, co-founder and CEO of Charityvest, which doesn’t offer users the option to grant to ex-U.S. nonprofits directly on its platform.
TrustBridge has built a compliance framework to simplify the process. It can accept U.S. donations and quickly distribute the funds through a hub-and-spoke network of foundations around the world. Built on the premise that all charities should have what they need to accomplish their mission, TrustBridge sees speed as a major part of the impact equation.
“The’ve kind of created this international highway of charitable organizations and foundations that are highly reliable, highly ethical, and the compliance highway is super well-trodden,” Mr. Kump said.
Charityvest has always registered interest in international giving on its platform, but it “never got above the ‘definitely let’s do it’ bar” for creating an in-house solution, Mr. Kump said.
A big donor looking for last-mile giving options within Charityvest tipped the scales toward formalizing the relationship with TrustBridge, he added.
Now, international grant-making works for all users, many of whom are mom-and-pop philanthropists brought onto the platform since its founding in 2016 with the goal of using tech to bring donor advised funds to the masses.
Charityvest has excelled in bringing individuals and institutions into a previously rarefied domain of high-net-worth givers. Donor advised funds allow individuals or charities to donate money into an account, immediately marking it for charitable purposes while generating a tax benefit. The donor then has the option to decide later when and to whom the grant money ultimately flows.
Especially in the case of a once-in-a-lifetime windfall events like an inheritance or the sale of a company, decoupling these choices can be beneficial for the donor and the world at large, says Mr. Kump.
“It’s really about splitting the decision between giving the money to charity and getting the tax advantage, and then the decision of where exactly that money is going to be doing good in the world,” Mr. Kump said.
Some donors, for instance, might want to spread their giving over a period of decades, he explained. In that case, the funds can grow tax-free with interest over time until a grant is made.
For others, donor advised funds are simply a way to streamline their giving and receive one statement at the end of the year.
Charityvest sees both use cases, and it can reach 1.4 million nonprofits — virtually all with tax identification numbers in the United States — as grantees. In 2023, Charityvest surpassed $100 million in grants issued through its platform, doled out by a blend of individual donors and household-name foundations.
“It’s a really strong mix all over the wealth and income spectrum. We have seven-figure donors on the platform and a lot of three-figure donors that give in the hundreds per year,” Mr. Kump says. “The distribution of users on the platform is actually pretty broad, which we love.”
While the former make the math of its business model work, driving essential money flows, the smaller donors mean the company is accomplishing the mission of driving non-traditional users toward tech-enabled tools they can use to grow their charitable impact.
“We don’t make any money off the international activity itself, but attracting more and larger donors does help our revenue, just because we get more money on the platform,” Mr. Kump says.
Much like a bank that lends against its deposits, Charityvest makes money by parking some of the funds flowing through its accounts into low-risk money-market funds that generate a modest return.
While free for users that simply use Charityvest as a vehicle for grant-making, the company charges a small administrative fee (at least $4 per month or 0.45 percent) and small fees on investments for those that want to grow the money sitting in their accounts through a couple of exchange-traded fund options.
Along with Community Funds, a social giving platform where donors pool funds in a common DAF, Charityvest also serves workplaces, allowing companies to set up charitable stipends, matching programs and donations of company equity and other assets for their employees.
A new channel will soon open up allowing financial advisors to white-label the Charityvest product, giving them another way to demonstrate value to clients by helping demystify the DAF, an instrument that some have traditionally avoided due to lack of familiarity. Donor advised funds can accept all kinds of gifts, from stock to company shares to cryptocurrency.
“If we can create an avenue for the advisor to have something simple and straightforward and attractive that is consistent with what they are trying to do, that is a huge win for us and a huge win for the advisor,” Mr. Kump said. “Giving is an area where they haven’t had a proactive tool to use.”
Mr. Kump admits that international giving is not yet so streamlined.
Those wanting to make grants to international charities through Charityvest should ask them to join the TrustBridge Global network, an annual vetting process that costs 150 Swiss francs (about $166 at this writing). Once the charity is approved, it can receive grants both via Charityvest and through anyone in the TrustBridge network. Any grants will be assessed a 1 percent fee, with a 300-franc minimum. Learn about international grant-making through Charityvest
Mr. Kump says Charityvest hopes to one day be more directly integrated with the international charities that TrustBridge has approved.
For now, it’s focused on continually driving impact through its platform, using contributions to the donor-advised fund as its main metric of success.
“That is a dollar that someone has said, ‘I want this to be in a charitable status irrevocably and I want to trust it to Charityvest,’” he said. “That’s really our proxy: people are choosing us, and they’re choosing giving.”
Less quantifiable is how it’s achieving the mission that spurred the company’s founding.
“Our mission is to catalyze generosity. That is something that happens in someone’s life and heart — not necessary in how much of their net worth or income they give.” Evaluating that is more of an art that “comes from seeing how our tools have activated someone toward a deeper, richer, more purposeful vision.”
Charityvest now employs about 10 people full-time, with some key hires on the horizon; its platform, meanwhile, is highly scalable, enabling significant prospective revenue growth without necessarily growing the overhead much, Mr. Kump said. Founded in Atlanta, most of its team is in Georgia, with Mr. Kump now living in Columbus, and its address is listed at 75 5th St. in Midtown.
Head of Product Kathleen Williams will be speaking this Thursday, Nov. 9 at the inaugural Global Atlanta Solutions Summit, which will highlight local organizations and companies helping solve global problems.