Get Off Your Assets: Tides’ Commitment to Principled, Impactful Donor-Advised Funds

At Tides, we are constantly reminded of the giants in our space, including the commercial donor-advised fund (DAF) providers like Fidelity and Schwab, who have grown their assets and client base significantly over the past several years. Contributions to Fidelity reached $6.8 billion in 2017—nearly twice the $3.5 billion contributed to United Way Worldwide. Their staggering growth rate and assets under management are impressive, and their billions in grants out per year have a positive impact and should be lifted up accordingly. Commercial DAF providers have made philanthropy easier and more accessible to thousands, and of course, their grants have benefited millions of lives.

And yet, as public charities who partner with donors on their philanthropy, shouldn’t we be held to a higher standard than just the total assets under management, and volume of grants in and grants out? At this time of peril, we need to be asking ourselves tougher questions: What are we really fighting for? What change do we want to see in the world? And how can we use our power, networks, and resources to get there?

Our democracy is fraying, the world is burning, communities of color are under siege, and there’s a refugee crisis at our border. Philanthropy, and specifically DAF providers, need to take a more proactive and principled stand on the big issues of our time. If not now, when?

First, and most important, it’s imperative that we encourage our donor partners to move money out of their DAFs at a quicker pace. While grants out from DAFs increased from 2016 to 2017, the amount of wealth that’s accumulating at DAFs is staggering. Too much money that’s intended for social good is sitting on the sidelines. At Tides, we are honored to partner with donors who feel this sense of urgency, and we are actively encouraging our partners to step up to push the boundary with every dollar to fuel real and lasting change. But we need more donors and DAF providers to join us.

Second, we need to prioritize impact and effectiveness, realizing that bigger isn’t necessarily better. I see a different path for us, one that is focused on partnering with donors who care deeply about the injustices in our society and the health of our planet, and who are moved to act with urgency and conviction. We commit to aiding them in their quest, and move money out with purpose and speed to the frontlines of racial, economic, and environmental injustice.

At Tides, our partners come to us for DAF work because they know that we offer more than just a fast, cheap option. This is our commitment: 

  1. We are and will always be mission-driven. We have worked at the nexus of funders, changemakers, and policy for decades, so we can advise clients on what’s working, what social change organizations need to scale, and how best to support them in service of lasting impact on the issues we care about.
  2. Before we make grants that are recommended by our donors, we go the extra mile to ensure that none of our funds will support activities that are counter to our values and mission. 
  3. We take a firm stand against hate; we do not accept funds from donors or make contributions to grantees that intend to support or engage in hateful activities. Read our full statement here.
  4. We push the boundaries on grantmaking—we give to international NGOs, we give to 501(c)(4)s, we give to social enterprises. 
  5. We prioritize and invest in issue-area specialists on our team who stay connected to the movements and leaders we support, so we can advise our partners on where and how to have the biggest impact. 
  6. We foster collaboration and create pooled funds that allow donors to maximize their impact by working together on shared goals. 
  7. We are committed to a 100% impact investment portfolio, ensuring that we maintain fiscal responsibility while leveraging our invested funds for social good.
  8. We partner with donors to invest DAF assets in mission-aligned portfolios, and enable direct investments in companies that advance our mission. The end result: deeper alignment between grantmaking and investing, which allows our donor partners to amplify their impact.

All of these activities cost more money and take more time. But it’s well worth the investment.

DAFs have such an important role to play in philanthropy. At Tides, we are nimble, flexible and cost-efficient. But that’s not enough. We need to be smart, creative, and mission-driven to achieve our vision of a society of shared prosperity and social justice. DAFs are the fastest growing charitable vehicle in the sector, and we’re proud of our DAF offerings. Let’s use that power to go all in on justice and equity. It’s the only way we’re going to solve the defining challenges of our time.

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