Equitybee is partnering with UI Charitable, a Donor-Advised Fund sponsor built for the way startup employees and founders actually hold wealth. The two companies solve different ends of the same problem. Equitybee helps you unlock the value of startup equity. UI Charitable helps you give from illiquid and private assets. This post is about the second one, and why it matters most in the year your equity pays off.
Today, we’re announcing a $57 million Series B funding. The round was led by existing investor Group 11, with participation from new investor Greenfield Partners, as well as Battery Ventures, Local Globe and ICON.
We are humbled that people are turning to EquityBee to participate in the success of the companies they themselves–the hardworking startup employees, that is–have helped build.
But more than that, that our investors have decided to preemptively raise our Series B well ahead of schedule, it means there is significant buy-in for our work and its outcomes.
During this unusually active time for high-growth and pre-IPO companies (IPO’s, acquisitions, and SPAC’s: Oh my!), startup employees’ equity is really heating up.
And we are immeasurably proud to be the platform they are choosing to 1) better understand and 2) secure the financial future that they’ve earned, but may not be able to afford to access.
We’re delighted more people choose to work with EquityBee, from the employees who need capital in order to exercise the options they would previously have been priced out of purchasing, to our investor network looking to take part in the rush of liquidity events occurring at breakneck speed.
We will continue to remain focused on always enhancing the experience we provide our customers.
With this funding, we’ll continue to invest in scaling our platform, building new products, and accelerating build-out of our operations.
This includes hiring the best of the best across our offices in the heart of Silicon Valley and Tel Aviv.
Thank you to all of our customers for being a part of this journey, whether you’re new to EquityBee or have been with us every step of the way since our inception.
Together, we will pave the way for an Open Options for All marketplace in which no dynamic startup employee should be left out of benefitting from their company’s financial wins.
What a Donor-Advised Fund actually is
A Donor-Advised Fund is a charitable account held by a sponsoring 501(c)(3), in this case UI Charitable. Once you contribute assets, you no longer legally own them, which is what makes the deduction work. What you keep is advisory privilege. You advise how the funds are invested, when assets are sold, and which charities receive grants over time. The deduction happens in the year you contribute. The giving to actual charities happens on the timeline you advise, with no required distributions in any given year.
Stage two: this is where UI Charitable is different, and where it fits startup employees
Here is the part that matters for the way you specifically hold wealth.
UI Charitable allows you to donate long-term appreciated assets such as public stock, private stock, cryptocurrency, etc. to a Donor-Advised Fund, and receive a tax deduction equal to the fair market value of those assets. Startup employees are exactly the people whose appreciated wealth sits in private and illiquid form. UI Charitable can serve the asset class most of the giving world cannot.
One important boundary
To be clear about what does and does not apply. You cannot donate shares that are covered securities by the Equitybee agreement and received by using Equitybee stock option funding. You can, however, donate other appreciated assets to UI Charitable.
*This is not tax advice. Consult a qualified tax professional regarding your specific financial situation.
Case Study: A startup employee in California
How does it actually work? A side-by-side comparison of a startup employee in California.
This same example would work for any appreciated asset donated in-kind.
Startup employee in California
Salary: $350K • Private share value: $1M • Shares donated to a Donor-Advised Fund: $300K (30%)
Getting started
get started with UI Charitable by visiting https://www.uicharitable.org/equitybee
