Corporate Philanthropy Organization Pledge 1% U.S., since its launch in 2014, has asked founders to donate 1% of their companies’ equity, product or employee time starting from the first day of their business.
While the Bay Area-based organization has received meaningful support from companies such as DocuSign, Box, Twilio Okta and PagerDuty, which pledged their resources before becoming publicly traded companies, Pledge 1% is now taking its inquiries a bit faster. doing, and asking a growing list of VCs to help too By prompting its companies to donate 1% of their outstanding equity before a public offering, it hopes it will become a billion-dollar charity.
It’s a soft sell, as the organization’s CEO, Amy Lesnick, describes it. Their five-person team is asking VCs not to relinquish any of their ownership in pre-IPO companies. Instead, Pledge 1% — originally co-founded by Salesforce founder Marc Benioff and Atlassian co-founder Scott Farquhar, among others — has listed VCs who are also “associates” of the organization, who are the founders. Willing to talk more systematically with those whose companies are ready to go. Public within 12 to 18 months.
The idea is to help persuade these founding teams to set up a corporate-donor-advising fund so that when their companies’ shares begin trading, they already have a scheduled sale of those shares, or else exercise. Have a plan to do (and donate). them after the lock-up period after the company’s IPO.
This is already happening somewhat systematically, she adds. Last year, Coinbase, UiPath and Unity worked with Pledge 1% to set aside $1 billion in equity.
Lesnik explains that most of the goal of Pledge 1% is to institutionalize the process. In his view, more companies want to incorporate philanthropy into their corporate culture, but it is sometimes challenging for fast-moving startups to know how to do so. Meanwhile, because VCs sit on so many boards, nearly 50 of them have come together to help make Pledge 1% a living playbook for founders and step in to formalize equity pledges for companies. Come along with a step-by-step guide as well as a companion guide to CFOs. and in-house lawyers.
In fact, while right now, participating VCs will be focused more on gifting their mature portfolio companies, Lesnick says Pledge 1%’s aspiration is that all venture-backed companies will eventually go through each round. Will set aside some equity for social impact. The capital they raise.
“Hopefully,” Lesnick says, “we’ll have a conversation in five years and we’ll talk about what we had to talk about. [startups donating equity] Because that would just be ideal. “
By joining the program as a VC or founder, as well as seeing who has already signed up (including Accel, Bessemer, Benchmark and Andreessen Horowitz), you can learn more here.