Sounds like you got what you needed from Claude, but to slightly expand if anyone else is interested...
Donating stock to DAFs: Fidelity Charitable, Schwab Charitable, and Vanguard Charitable all accept private company stock, including pre-IPO shares, though acceptance is case-by-case and depends on the company’s transfer restrictions. Daffy has a dedicated private stock program (and extended it to all employees in 2024); Charityvest accepts private stock and a wider range of complex assets via a partner firm. The donor gets a fair-market-value deduction at the time of contribution (for shares held more than a year), and the DAF holds the shares until a liquidity event. This is the most common path.
Donation to charities directly: A number of large operating charities (GiveDirectly included) can accept private stock and hold it until they can liquidate—but most can’t, so it’s worth asking specifically.
The transfer-restriction question is the main one to investigate. Before any of this works, you need to confirm with your company that the share class you hold is transferable to a 501(c)(3) or DAF, and whether company consent or right-of-first-refusal applies. Some pre-IPO companies allow charitable transfers cleanly; others restrict them tightly.
It’s worth taking a moment on the several good reasons I think it’s worth donating stock even before an IPO or liquidity event.
Good tax math: donating appreciated shares directly avoids capital gains entirely and still gets you a fair-market-value deduction, so for early-employee or founder stock you’re often able to donate 25–35% more for the same out-of-pocket cost than if you sold and donated the proceeds.
Valuation upside: the charity captures the appreciation between now and the exit, not you-then-a-smaller-gift-later. And the deduction timing favors going early: appreciated-stock donations are capped at 30% of your taxable income per year, so a single post-exit gift often pushes most of the deduction into future years, while spreading donations pre-IPO lets you use them as they happen (often more valuable to you now than later post exit).
To channel the original post—waiting for the exit is just another flavor of the delay trap; there are paths to start now.
Thanks again for commenting and glad this post could be useful!
The problem with charities/​DAFs accepting pre-IPO stocks though is that they still need some way of liquidiating those stocks at the end of the day.
There’s also more exotic things that are possible, for a large enough donation size. A year ago before the Anthropic tenders were worked out, I had a proposal for lining up Anthropic employees & EA earn-to-give donors, and having them do a donation swap.
Some people (earn-to-give folks? banks?) may be willing to lend you money against your private/​pre-IPO stock as well?
Sorry, I should have asked Claude in the first place. To repeat what it said:
Some charities accept private or pre-IPO stock.
Donor Advised Funds can accept pre-IPO shares.
I’ll reach out to the equity folks at Waymo to confirm this is allowed, and reach out to relevant charities that they can accept this kind of stock.
Hey Dan! Glad this was useful.
Sounds like you got what you needed from Claude, but to slightly expand if anyone else is interested...
Donating stock to DAFs: Fidelity Charitable, Schwab Charitable, and Vanguard Charitable all accept private company stock, including pre-IPO shares, though acceptance is case-by-case and depends on the company’s transfer restrictions. Daffy has a dedicated private stock program (and extended it to all employees in 2024); Charityvest accepts private stock and a wider range of complex assets via a partner firm. The donor gets a fair-market-value deduction at the time of contribution (for shares held more than a year), and the DAF holds the shares until a liquidity event. This is the most common path.
Donation to charities directly: A number of large operating charities (GiveDirectly included) can accept private stock and hold it until they can liquidate—but most can’t, so it’s worth asking specifically.
The transfer-restriction question is the main one to investigate. Before any of this works, you need to confirm with your company that the share class you hold is transferable to a 501(c)(3) or DAF, and whether company consent or right-of-first-refusal applies. Some pre-IPO companies allow charitable transfers cleanly; others restrict them tightly.
It’s worth taking a moment on the several good reasons I think it’s worth donating stock even before an IPO or liquidity event.
Good tax math: donating appreciated shares directly avoids capital gains entirely and still gets you a fair-market-value deduction, so for early-employee or founder stock you’re often able to donate 25–35% more for the same out-of-pocket cost than if you sold and donated the proceeds.
Valuation upside: the charity captures the appreciation between now and the exit, not you-then-a-smaller-gift-later. And the deduction timing favors going early: appreciated-stock donations are capped at 30% of your taxable income per year, so a single post-exit gift often pushes most of the deduction into future years, while spreading donations pre-IPO lets you use them as they happen (often more valuable to you now than later post exit).
To channel the original post—waiting for the exit is just another flavor of the delay trap; there are paths to start now.
Thanks again for commenting and glad this post could be useful!
Thanks Nick, this comment was helpful.
The note that appreciated-stock donations are capped at 30% of my taxable is particularly relevant this year.
And good point that the charity has to deal w/​ liquidation, so illiquid stock is less useful for orgs with near term needs.
100% agreed it is so tempting to donate next year (or the year after etc).
The problem with charities/​DAFs accepting pre-IPO stocks though is that they still need some way of liquidiating those stocks at the end of the day.
There’s also more exotic things that are possible, for a large enough donation size. A year ago before the Anthropic tenders were worked out, I had a proposal for lining up Anthropic employees & EA earn-to-give donors, and having them do a donation swap.
Some people (earn-to-give folks? banks?) may be willing to lend you money against your private/​pre-IPO stock as well?