SAN FRANCISCO--(BUSINESS WIRE)--SharesPost, a leading liquidity provider to the Private Technology Growth asset category, today announced an innovative new program to enable venture-backed tech firms and individual shareholders of private company stock to more easily donate their shares to support charities of their choice.
SharesPost, working with Fidelity Charitable®, is bringing technical expertise on gifting private company shares to charity in an effort to raise awareness of this tax-efficient strategy, increase adoption and make money available to nonprofits that was not previously accessible. With this strategy, Silicon Valley founders, entrepreneurs and private capital investors can increase the impact of their charitable giving through the appreciation in their private company investments.
“SharesPost and Fidelity Charitable are collaborating to make donating venture-backed private company shares to charitable organizations easy and efficient for all stakeholders, including charitable grant recipients,” said SharesPost Founder and CEO Greg Brogger. “SharesPost’s institutional caliber platform, combined with Fidelity Charitable’s complex asset expertise and donor-advised fund program, is ushering in a new era of philanthropy in the ventured-backed ecosystem.”
“For founders, entrepreneurs, private capital investors or anyone experiencing strong appreciation in their private stock portfolios or those who are facing forced capital gains in the wake of a liquidity event, this program has the power to transform the way private tech company shareholders fund their philanthropy. Since we opened our doors in 1991, Fidelity Charitable has accepted contributions of over $3 billion in non-publicly traded assets for donors to support charities using just this strategy,” said Karla Valas, VP & Managing Director of the Advanced Planning Group at Fidelity Charitable.
How It Works
Fidelity Charitable® is an independent, section 501(c)(3) public charity that operates a donor- advised fund program exclusively for charitable purposes. A Giving Account®, the Fidelity Charitable donor-advised fund, can be set up by corporations with a minimum of $25,000 or individuals with a minimum of $5,000. Donors with private company stock work with Fidelity Charitable’s Complex Asset Group and the issuer to facilitate the legal transfer of the stock to the charity. Donors are eligible for a fair market value tax deduction1 in the year the shares are donated. Neither the donor nor the charity is subject to tax on the gain from the charity’s sale of the stock, which enables the donor to give up to 20% more2. The donor can recommend how the funds in the Giving Account are invested for potentially tax-free growth and recommend which charities to support.
SharesPost’s initiative supports the gifting of private company stock to donor-advised funds in the following additional ways:
- Donors have easy access to learning more about this strategy through the SharesPost website which provides education on how to make donations of private capital investments.
- SharesPost facilitates easy charitable contributions of privately held stock to Fidelity Charitable through exchanges with the SharesPost100 Fund (“SP100 Fund”).
- SharesPost’s investment advisory and research groups can provide valuation analysis to support tax substantiation by leveraging the proprietary data and valuation methodology used daily to publish the Net Asset Value of the SP100 Fund.
- SharesPost can provide shareholders of private tech companies or Fidelity Charitable with the opportunity to sell donated shares to finance charitable grant making.
For more information, contact Carine Schneider at cschneider@sharespost.com.
About SharesPost, Inc.
SharesPost helped launch the private tech growth market in 2009 and continues to lead and innovate in the space. Based in Silicon Valley, SharesPost is an SEC-registered broker-dealer, investment advisor and Alternative Trading System. SharesPost has built one of the largest and most active platform for data, analysis and transactions. With nearly $3 billion in closed transactions for more than 180 leading technology companies, SharesPost provides shareholders and buyers with the trading, research and online tools to transact in the private market with confidence. For more information, please visit sharespost.com.
About the SharesPost 100 Fund
The SharesPost 100 Fund was launched in March 2014 to provide all investors access to a portfolio of late-stage, private growth companies, an asset class that has traditionally been only available to institutional investors and the very wealthy. The Fund has no accreditation requirements and is available for a $2500 minimum investment. Through the company’s growing list of advisors, retail investors can now invest in a ’40 Act registered fund, which targets investments exclusively in late-stage private growth companies. The Fund is distributed by Foreside Fund Services, LLC.
Important Disclosure
Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus with this and other information about the Fund, please download here. Read the prospectus carefully before investing.
Investment in the SharesPost 100 Fund involves substantial risk. The Fund is not be suitable for investors who cannot bear the risk of loss of all or part of their investment. The Fund is appropriate only for investors who can tolerate a high degree of risk and do not require a liquid investment. The Fund has no history of public trading and investors should not expect to sell shares other than through the Fund's repurchase policy regardless of how the Fund performs. The Fund does not intend to list its shares on any exchange and does not expect a secondary market to develop.
All investing involves risk including the possible loss of principal. Shares in the Fund are highly illiquid, and you may not be able to sell your shares when, or in the amount that, you desire. The Fund intends to primarily invest in securities of private, late-stage, venture-backed growth companies. There are significant potential risks relating to investing in such securities. Because most of the securities in which the Fund invests are not publicly traded, the Fund’s investments will be valued by the Investment Adviser pursuant to fair valuation procedures and methodologies adopted by the Board of Trustees. While the Fund and the Investment Adviser will use good faith efforts to determine the fair value of the Fund’s securities, value will be based on the parameters set forth by the Prospectus. As a consequence, the value of the securities, and therefore the Fund’s NAV, may vary. Due to transfer restrictions and the illiquid nature of the Fund’s investments, you may not be able to sell your investments when you wish to do so. There are significant potential risks associated with investing in venture capital and private equity-backed companies with complex capital structures. The Fund focuses its investments in a limited number of securities, which could subject it to greater risk than that of a larger, more varied portfolio. There is a greater focus in technology securities that could adversely affect the Fund’s performance. If the Fund does not have at least 500 Members for an entire taxable year, you could receive an adverse tax treatment. The Fund’s quarterly repurchase policy may require the Fund to liquidate portfolio holdings earlier than the Investment Adviser would otherwise do so, and may also result in an increase in the Fund’s expense ratio. This is not a complete enumeration of the Fund’s risks. Please read the Fund prospectus for other risk factors related to the Fund, its investment strategy and your investment in the Fund, and other additional details.
Certain potential conflicts of interest involving the Fund’s Investment Adviser and its affiliates could impact the Fund’s investment returns and limit the flexibility of the implementation of its investment policies. New investment opportunities that meet the Fund’s investment objectives might not be offered, or otherwise made available to the Fund, due to affiliations between entities related to the Fund. Prospective investors should review the conflicts of interest described in the section entitled “Conflicts of Interest” in the Prospectus prior to making an investment in the Fund.
The SharesPost 100 Fund is distributed by Foreside Fund Services, LLC.
1Fair market value for non-publicly traded
securities is determined by a qualified independent appraisal.
2This
assumes all realized gains are subject to the maximum federal long-term
capital gains tax rate of 20% and the Medicare surtax of 3.8%, and that
the donor originally planned to sell the stock and contribute the net
proceeds (less the capital gains tax and Medicare surtax) to charity.
