From Business Exit to Lasting Impact: A Founder’s Philanthropic Playbook
Selling your business is more than a financial transaction; it’s the beginning of a profound transition. It marks the moment you convert your life’s work into the capital that will fund your future and define your legacy. For many founders, this prompts a critical question: How can I use this success to make a meaningful impact?
The answer involves a two-part strategy:
- The most financially significant philanthropic decisions happen before the ink is dry on a sale agreement.
- The execution of your vision happens after the sale is complete.
This playbook introduces you to both stages.
Part 1: Before the Sale — The Most Impactful Decision You Can Make
The single most effective way to be charitable with your business is to give a portion of it away before it’s sold. This requires a mental shift away from thinking your checkbook is your primary tool for generosity.
For a business owner, the vast majority of your wealth isn’t in cash; it’s locked up in your business equity. Using that equity is the key. In an interview for our Charting Opportunities series, charitable giving expert Brandon Davis of the National Christian Foundation highlighted this very disconnect:
“The statistics are something like 7 to 10 percent of what’s held on people’s balance… is in cash… And that’s how we do up to 95 percent of our giving. We take that little bit of cash, that’s how we do all of our generosity…”
By donating a percentage of your company shares to a charitable vehicle like a Donor-Advised Fund (DAF) before a sale, you can:
- Potentially Eliminate Capital Gains Tax on the portion you donate.
- Receive a Significant, Immediate Tax Deduction based on the fair market value of the shares.
- Give More to Charity. Because of the tax savings, more of your company’s value ends up funding your mission, not paying taxes.
This pre-sale strategy is the essence of turning your business success into a powerful philanthropic engine.
View Brandon’s full episode interview here.
Part 2: After the Sale — Bringing Your Philanthropic Vision to Life
Once the sale is complete and the proceeds have funded your charitable fund, the “Now what?” phase begins. This is where you transition from financial strategy to hands-on impact. This is the time to execute the vision you planned.
1. Define Your Mission.
If you haven’t already, now is the time to get laser-focused.
- What change do you want to create?
- What problems do you want to solve?
As Brandon Davis suggests, this should be driven by what you care about most:
“My question would be, you know, for someone considering this, what is it that you’re passionate about? What is the cause? What is the organization?… Let that kind of be the driver.”
2. Assemble Your “Impact Team.”
Just as you had key advisors for your business, you need a team for your philanthropy. This includes your financial advisor to quarterback the strategy, alongside your CPA and attorney to manage the tax and legal details of your giving.
3. Grant with Purpose.
With your funds secured in a vehicle like a Donor-Advised Fund, you can now recommend grants to the non-profits you wish to support. A DAF gives you the flexibility to support various charities over many years, allowing you to learn, adapt, and refine your giving strategy as you go.
Your Second Act Awaits
By separating your philanthropic planning into these two distinct phases—strategic pre-sale planning and thoughtful post-sale execution—you can create a legacy that is as impressive as the business you built.
The transition from a successful exit to a life of impact requires a new kind of plan. At Portus Wealth Advisors, we help founders like you design and execute a philanthropic strategy that aligns your wealth with your values.
Contact us today to start building your legacy.
Call Us: 704-936-0084
