Local nonprofits reap huge rewards
Recent months have brought tremendous excitement to The Community Foundation Serving Boulder County, thanks to a string of generous “exits” among a network of Colorado entrepreneurs whose companies pledged a portion of their early equity to EFCO – which, in turn, will distribute funds to the startups’ nonprofits of choice.
“An example of an ‘exit’ is when a company that has designated early equity to the Entrepreneurs Foundation of Colorado realizes its success, and benefits our community as a result,” explained Morgan McMillan, EFCO Executive Director. “It’s a great way for a startup to significantly impact the community once it goes public or gets acquired. It’s a win for everybody.”
In April, EFCO and the foundation scored $587,155 through Twitter’s acquisition of Gnip Inc., a leading provider of social data; as well as $67,000 through Findmypast’s June acquisition of genealogy innovator Mocavo, founded by Cliff Shaw; and a $22,500 donation from Doc Popcorn International Inc., – founded by husband-and-wife duo Rob and Renée Israel – as a result of its July acquisition by Dippin’ Dots Franchising LLC. All three of the acquired companies had their start in Boulder.
While Shaw has designated 90% of Mocavo’s contribution to the foundation’s general Community Trust and 10% to EFCO, the Israels will distribute their donation among specific community nonprofits aligned with their values. “We always felt strongly that if our company prospered, our community should benefit,” said Renée Israel. “Since joining EFCO in 2009, our team has volunteered at various EFCO events, including the office-hours program that EFCO set up during Entrepreneur week last year.” Over the years, Doc Popcorn has also donated to Children’s Hospital, The School Food Project and the Emergency Family Assistance Association. In addition, through its Poppin’ for Pink initiative, Doc Popcorn raises money each October for the National Breast Cancer Association.
For Gnip founder Jud Valeski, EFCO was a way to easily build philanthropy into the company’s growth. “Being in the startup world for most of my career, I know how equity works…and I understand leveraging. When you couple that dynamic with an organization that’s working to strengthen the community of entrepreneurism in my community – Boulder – that’s tremendously appealing.
“My wife and I grew up here; and then we left. But we came back in the late 90s when we saw the community begin to embrace entrepreneurism. Any organization, including EFCO and various Meetups, that was supportive of entrepreneurs was interesting to me. The financial upside of EFCO made sense to me, too.
“You can make financial donations, but there’s no leverage in that. We wanted to contribute in broad strokes, not narrow it down to one cause. That’s why it’s incredibly rewarding to see this thing come full circle, and to know that we can help fuel what’s next – and needed – in our community.
“It’s hard to see it up front, but it’s 10 times more joyful than I could have imagined. At the time, it was a methodical decision that just felt right…but now, a piece of paper has been transformed into real community impact.”
These days, Valeski is passionate about photography and traveling. “If I wind up starting something again, I want a lot of space and distance on it. For now, I’m pouring my energy into something artistic.”
Like Shaw, Valeski allocated 90% of Gnip’s contribution (a combination of cash and Twitter stock) to the foundation’s Community Trust, and 10% to EFCO’s operating fund. Indeed, Gnip’s contribution is EFCO’s second-largest (after Rally Software Development Corp.’s $1.4 million distribution in October of 2013).
Since 2008, EFCO – one of just five affiliates nationwide of a similar program that originated in Silicon Valley some 15 years ago – has distributed $2.7 million among nonprofits across the state; 65 companies have pledged equity or annual profits to EFCO thus far, now nine of which have provided nonprofits with a payday. To donate, volunteer or join the EFCO network of entrepreneurs, contact Morgan McMillan at 303-442-0436 x115, or morgan@commfound.org.
