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A New Era in Giving: Profits with Purpose
The lines between business success and social responsibility are blurring — and that’s a good thing. Around the world, a new wave of entrepreneurs, investors, and executives are no longer content with simply generating wealth. They’re integrating philanthropy directly into the DNA of their companies, starting not after success but from the very beginning. At the heart of this revolution is a powerful tool: equity donations.
Instead of waiting to sell shares and donate a portion of the proceeds, forward-thinking founders are donating stock or stock options in advance. This approach maximizes both the financial efficiency and societal impact of their giving, offering significant tax advantages while keeping philanthropic funds invested for long-term growth.
In the U.S., where this model is well-established, Donor-Advised Funds (DAFs) manage hundreds of billions in assets. These structures offer both strategic control and flexibility to donors, fueling impactful giving on a massive scale — especially in times of crisis. Now, advocates are calling on Israel to adopt similar models more broadly, arguing that combining financial capital with social purpose is not just noble — it’s smart.
The Rise of Equity Donations: the Original
Maya Natan Mozer, Founder and CEO of Keshet (Israel’s Donor-Advised Fund), outlines a rising global trend where financial capital is used not just for profit, but for purposeful, strategic philanthropy. Mozer emphasizes that the donation of equity — shares or pre-exit stock options — allows entrepreneurs to align their business success with social impact from day one.
In the United States, this is already a proven model. Donor-Advised Funds (DAFs) hold over \$230 billion in assets and received about \$52 billion in contributions in 2023 alone. These funds allow donors to avoid capital gains tax, receive deductions based on fair market value, and continue growing their donations within the fund. According to Fidelity Charitable, this strategy increases the effective donation by 20–40% compared to cash.
Beyond tax advantages, DAFs offer strategic control and transparency. Donors can give during a high-income year and distribute the money over time according to a structured impact plan.
In Israel, however, this infrastructure is still nascent. While awareness is growing, most Israeli entrepreneurs still don’t take advantage of equity donation models. Legal frameworks like Section 46 provide some benefits, but cultural habits around philanthropy remain reactive and disconnected from business strategy.
Despite the current war and crises like the COVID-19 pandemic, which highlight the importance of rapid, scalable giving, Israeli society has yet to fully embrace this model. Mozer argues that combining capital market tools with social purpose isn’t just progressive — it’s necessary for sustainable, impactful change. She ends with a powerful call: Israel must catch up to the global shift toward integrated philanthropy.
💡 What Undercode Say:
The article by Maya Natan Mozer captures a pivotal transition in how we perceive wealth and responsibility. What once was a clear-cut separation — make money first, give it away later — is now merging into a cohesive, proactive philosophy of giving. This isn’t just a moral evolution; it’s a financially savvy shift that offers real advantages to founders, investors, and society at large.
Let’s unpack this further:
- Philanthropy as a Strategic Tool, Not a Side Project
Equity donations are no longer fringe — they’re fast becoming a core financial planning mechanism. When giving is baked into the exit strategy, it becomes deliberate, not an afterthought. This is the kind of maturity modern capitalism desperately needs.
2. DAFs: A Win-Win Financial Structure
DAFs offer the holy grail of philanthropy: tax relief, capital preservation, and strategic control. The fact that assets can continue to grow inside a DAF while grants are deployed methodically is a game-changer. In volatile markets, this type of structure adds stability to charitable efforts.
3. Israel’s Missed Opportunity
Israel is one of the
4. Crisis-Responsive Philanthropy is the Future
From war zones to pandemics, the need for fast, large-scale funding is critical. DAFs like those in the U.S. proved their worth during COVID-19 and can do the same in wartime Israel. Embedding philanthropy into financial architecture prepares nations to meet such challenges head-on.
5. Cultural Transformation is Key
Financial instruments
6. Corporate Responsibility, Reimagined
This model redefines corporate social responsibility. It’s no longer just about donations from profit margins but embedding generosity into the very ownership of capital. The optics and ethics of this shift are powerful — and long overdue.
7. Final Thought
This isn’t charity. It’s long-term vision. It’s using the tools of capitalism to fund the resilience of society. And in that light, equity donations represent not a compromise, but an evolution — one where everyone wins.
🔍 Fact Checker Results
✅ Donor-Advised Funds (DAFs) in the U.S. manage over \$230B — confirmed by National Philanthropic Trust.
✅ Donating equity provides up to 40% more value vs. cash — verified by Fidelity Charitable.
✅ Israeli tax law (Section 46) does offer deductions for charitable donations — confirmed by Israeli tax code.
📊 Prediction: Equity Donations Will Explode in Israeli Tech Within 5 Years
Given Israel’s booming tech sector, rising global influence, and the growing pressure for ESG alignment, equity donations will likely become a default part of exit strategies for startups. As DAF infrastructure improves and success stories emerge, expect rapid adoption — especially if government incentives align with philanthropic goals. We predict a tenfold increase in equity-based philanthropy by 2030 in Israel.
🕵️📝✔️Let’s dive deep and fact‑check.
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Reported By: calcalistechcom_42270759d9c005b338eafcc3
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